2.3.1 FTB Child of an ACO

Summary

This section explains eligibility for FTB for ACOs (1.1.A.80) and covers the following:

• general eligibility criteria,
• situations where the ACO is not eligible for FTB,
• a person providing care for a child in an ACO, and
• ACO that does not provide residential services.

An ACO is paid a flat rate of FTB.

Policy reference: FA Guide 3.1.2 FTB Rate for ACOs

General eligibility criteria

An ACO is eligible for FTB for a child if:

• the child is:
  • aged under 16 years, or
  • aged 16 to 19 years (up to the end of the calendar year in which they turn 19) and satisfies or is exempt from the FTB activity test (1.1.F.53), or
• the child is a client of the organisation, and
• the child is an Australian resident (1.1.A.130).

ACO eligibility & child's income

An ACO is not eligible for FTB if the child's ATI (1.1.A.20) is too high. The following table describes how much income the child can have.

The income year is the current financial year. If it becomes known that the child's ATI will exceed the cut-out amount during the income year, the ACO is no longer eligible from that point, even if the child's income has not yet reached the cut-out amount.

If the ACO is not eligible for the child for this reason, and the child's expected income changes during the income year, the ACO can claim FTB if the child's income will be less than the cut-out amount.

Act reference: FAAct Schedule 3 Adjusted taxable income

Policy reference: FA Guide 3.2 Adjusted Taxable Income

ACO eligibility & other types of payment

The ACO is not eligible for FTB if the child of any age, or someone else on their behalf, is receiving one of the following payments:

• a social security pension (1.1.S.90) or benefit (1.1.S.60), or
• a labour market program (1.1.L.10) payment, or
• a prescribed educational scheme payment (1.1.P.100).

Act reference: FAAct section 35(1) When an ACO is not eligible for FTB

ACOs & other FTB eligible individuals

An ACO is not eligible for FTB for a child if anyone else is eligible for FTB for the child. If an individual becomes eligible for FTB for a child who was cared for by an ACO, the ACO loses eligibility. FTB cannot be shared between an individual and an ACO.

Example: An ACO arranges long-term foster care with carer families. In these circumstances the foster carer is eligible for FTB, not the ACO, as the foster carer has legal responsibility for the day-to-day care, welfare and development of the child.

Person providing care for a child in an ACO

If a person is providing care for a child who is living in an ACO it is possible for the person to retain eligibility for FTB. In this case, the ACO cannot be eligible for FTB for the child.

Factors that should be considered when deciding whether the child is an FTB child of a person even though the child is a client of an ACO include:

• Is the person still responsible for the welfare and development of the child?
  • Example: The child receives their education in a boarding school.
• Does the person provide financial support for the child?
  • Example: The person pays fees to the ACO.
• Does the person have regular contact with the child?
  • Example: The person visits regularly on weekends, takes the child on day trips, or has the child overnight at home.
• Does the person provide for the health and physical well being of the child?
  • Example: The parent is consulted when the child needs medical attention and pays for any medical costs.
• Is the person the first contact in case of an emergency?
• Is there a definite date or intention for the child to return to live with the person?

All factors should be considered when deciding if the child is a dependant of the person or the ACO.

Example: Tony advises Centrelink that his child Susan has started to live in an ACO on a long-term basis. He provides financial and emotional support for Susan and is involved in making the day-to-day decisions about her care. Susan is still an FTB child of Tony's. The private financial arrangement he has made with the ACO for their costs may or may not be equivalent to the amount of FTB he receives.

ACO co-ordinates residential services

An ACO which co-ordinates but does not provide residential services to young people is still eligible for FTB. The young people are treated as clients of the ACO.

Act reference: FAAct section 34(3) Expanded meaning of client of an organisation

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Last reviewed: 20 March 2013