What is the family tax benefit?

The Australian Government has offered a family tax benefit to help with the cost of raising children. Here we look at what is the family tax benefit and if you're eligible.

The Australian Government offers several different types of income support payments to help with the cost of raising children. 

In this article, we'll look at the Family Tax Benefit in a little more detail. To start, there are actually two types of Family Tax Benefit:

  1. Part A: a payment made per child
  2. Part B: a payment made per family

You can choose to receive payments fortnightly or as a lump sum payment at the end of the financial year.

Family Tax Benefit Part A

  • It’s income tested, based on your family's annual income over the full financial year.
  • The amount you receive also depends on the number of children you have, their ages and the percentage of time you care for your children (if this is shared).

Current maximum payment rates

For each child

Per fortnight

0-12 years

$189.56

13-15 years

$246.54

16-19 years
(if meet study requirements)

$246.54

0-19 years
(in approved care organisation)

$60.90

Family Tax Benefit Part A Supplement

You may also receive a supplement of up to $781.10 per child at the end of the financial year, if your family has a combined income of $80,000 a year or less to be eligible for the supplement:

  • You must lodge a tax return with the ATO to confirm your income details.
  • Your child also needs to be up to date with immunisations listed on the National Immunisation Program Schedule (or hold a medical exemption) and meet the Healthy Start for School requirements if they apply.

Family Tax Benefit Part B

This offers extra support to single parents, non-parent carers and families with one main income.

The percentage of care is considered for shared care arrangements, and payment rates may change if you’re a parent returning to work.

Current maximum payment rates

Age of youngest child

Per fortnight

0-5 years

$161.14

5-18 years

$112.56

Family Tax Benefit Part B Supplement

You may also receive a supplement of up to $379.60 per family at the end of the financial year.

Family Tax Benefit eligibility

You may be eligible for Family Tax Benefit Part A if you have a dependent child who is 0-15 years old or aged 16-19 years old and in full-time secondary education.

You may be eligible for Family Tax Benefit Part B if you:

  • are a couple with one main income and care for dependent children under the age of 13 or
  • are a single parent or non-parent carer with a dependent child under age 18.

You cannot receive both Parental Leave Pay and Family Tax Benefit Part B.

For both Part A and Part B, you must also meet the income test, residency requirements and care for the child at least 35% of the time.

What’s the income test?

Family Tax Benefit Part A

  • Earning less than $55,626 (or you receive an income support payment): you’ll receive the maximum rate of Family Tax Benefit Part A.
  • Earning between $55,626 and $98,988: the rate reduces by 20 cents for each dollar earned above $55,626 until it reaches the base rate ($60.90 per fortnight).
  • Earning over $98,988: the rate reduces by 30 cents for each dollar of income over $98,988 until your payment is nil.

Family Tax Benefit Part B

  • The primary family income earner must earn less than $100,000 (adjusted taxable income).
  • Then the income of the parent or carer with the lower income (the secondary earner) is used to work out how much Family Tax Benefit Part B you’ll receive. The secondary earner can earn up to $5,767 (adjusted taxable income) each year before it affects the payment. Payments reduce by 20 cents for each dollar earned over $5,767.

Are there any additional payments I should know about?

If you receive Family Tax Benefit Part A you may also be eligible for the following.

Next: What is the parenting payment

The Australian Governments offers parenting payments to help with the cost of raising children. Here we look at what is parenting payments and if you're eligible.
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Information current as at July 2020. The information does not take into account your personal objectives, financial situation or needs and so you should consider its appropriateness, having regard to your personal objectives, financial situation and needs having regard to these factors before acting on it. Any taxation consideration outlined in this presentation are general statements, based on an interpretation of the current tax law, and do not constitute tax advice. The tax implications of the relevant products mentioned in this presentation can impact individual situations differently and you should seek specific tax advice from a registered tax agent or registered tax (financial) adviser.