7.2.1 Debt Recovery - General Provisions

Summary

This section contains information on the general provisions applying to debt (1.1.D.60) recovery, and discusses:

• how debts can be recovered, and
• time limits on debt recovery.

How debts can be recovered

A debt owed by an individual or ACO is recoverable by:

• deductions from FTB instalments payable to:
  • the individual, or
  • another consenting individual,
• offsetting arrears of FA payable to:
  • the individual, or
  • another consenting individual,
• cash instalments paid by the individual,
• offsetting an income tax refund owed to:
  • the individual, or
  • another consenting individual,
• legal proceedings, or
• a garnishee notice (1.1.G.10).

A debt owed by an approved child care service (1.1.A.90) is recoverable by:

• deductions from quarterly advances,
• legal proceedings, or
• a garnishee notice.

Note: FTB top-up payments can be used to offset any FTB and CCB debts. CCB top-up or lump sum payments can only be used to offset CCB reconciliation debts raised on or after 1 July 2006. CCR can only be used to offset current year or previous years CCB reconciliation debts. It cannot be used to offset other CCB debts, FTB reconciliation debts or other FTB debts.

Act reference: FA(Admin)Act section 82 Methods of recovery, section 82(3) Debt means...

Policy reference: FA Guide 7.2.2 Debt Recovery by Deduction, 7.2.3 Debt Recovery from FA Entitlement, 7.2.4 Debt Recovery by Cash, 7.2.5 Debt Recovery from Income Tax Refund, 7.2.6 Debt Recovery by Legal Proceedings, 7.2.7 Debt Recovery by Garnishee

Time limits on debt recovery

Generally, action for the recovery of a debt must be started within 6 years of the first day on which an officer becomes aware, or could reasonably be expected to have become aware of the circumstances that gave rise to the debt. Time limits apply to recovery action by:

• deduction from a person's FTB instalments,
• offsetting FA arrears against a debt,
• legal action, or
• garnishee.

The following table indicates exceptions to this general rule:

Act reference: FA(Admin)Act section 86 Time limits on recovery action under sections 84, 84A, 87A and 87B, section 88 Legal proceedings, section 90 Time limits on recovery action under section 89

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Last reviewed: 11 August 2011