Income and assets test for Youth Allowance
The amount of Youth Allowance you can receive will depend on your personal circumstances.
If you are dependent
As a dependent, a Personal Income Test and a Parental Means Test will be used to work out how much Youth Allowance you can get.
If you are a student under 22 years old and do not meet any of the independence criteria you will be deemed dependent. As a dependent your parents' income and assets may impact your eligibility and rate of payment.
If you are independent
If you are independent, a Personal Income Test and a Personal Assets Test will be used to work out if you can get Youth Allowance and how much you can get.
If you are independent your parents' income and assets are not generally taken into consideration. However, if you are a student from a regional or remote area applying for Youth Allowance under the earnings or part-time work independence criteria, your parental income is taken into account. In these circumstances parental income must be under $150,000.
If you are independent and have a partner, their income and assets will be considered.
Personal Income Test
A Personal Income Test will be used to determine your eligibility for Youth Allowance and how much you can get.
As a student or Australian Apprentice on Youth Allowance:
- you can earn up to $405 before tax per fortnight before your payment is affected
- income over $405 and up to $486 reduces your payment by 50 cents in the dollar
- income over $486 per fortnight reduces your payment by 60 cents in the dollar
If you earn money from paid work, Income Bank helps you keep more of your Youth Allowance payment. You can earn up to $405 a fortnight before your payment starts to reduce. The difference between the $405 and the amount you earn is added into the Income Bank.
You can earn more than $405 in a fortnight if you have money in your Income Bank.
The maximum amount you can accumulate in your Income Bank is $10,100 if you are a student or $1,000 if you are an Australian Apprentice.
As a Job Seeker on Youth Allowance:
- you can earn up to $143 before tax per fortnight before your payment is affected
- income over $143 and up to $250 reduces your payment by 50 cents in the dollar
- income over $250 per fortnight reduces your payment by 60 cents in the dollar
Your working credit balance may increase the amount you can earn before your payment is reduced.
Working credit (Youth Allowance Job Seekers)
Youth Allowance job seekers who are looking for work have access to working credit instead of the Student Income Bank. This helps you keep more of your Youth Allowance payment if you do any part-time or casual work. It also makes it easier for you to get Youth Allowance back if you have a short-term full-time job.
When your total income is less than $48 a fortnight, you will automatically build up working credits. You will earn one working credit for every dollar under the threshold. For example, if you earn $20 a fortnight, you will earn 28 working credits.
When you have income from work, your credits will reduce the effect that income has on your Youth Allowance payment.
You can collect up to 3,500 credits, and for every credit you can earn $1 extra before your Youth Allowance payment is reduced. Your credits will also help you keep more of your payment when you start a full-time job. This means that you could get some or all of your Youth Allowance payment in addition to your pay when you first start work.
Personal Assets Test
If you are an independent student, Australian Apprentice or job seeker the Personal Assets Test applies to you. The assets limits will vary, depending on whether or not you have a partner or own your own home.
If you have recently received any income from leave or redundancy, an income maintenance waiting period may apply.
Hardship provisions may apply.
Parental Means Test
If you are deemed as a dependent the Parental Means Test applies to you.
There are three parts to the Parental Means Test:
- Parental Income Test
- Family Assets Test, and
- Family Actual Means Test
Parental Income Test
The Parental Income Test includes:
- combined parental taxable income
- child support
- fringe benefits received from employers
- income from outside Australia
- reportable superannuation contributions, and
- net investment losses
If your parents' taxable income for the 2011-2012 financial year is $47,815 or less, your payments will not be affected by the income test. The rate of payment is reduced by 20 cents for every dollar over the threshold.
If your parents have other dependent children and their income exceeds $47,815, your sibling's circumstances may affect your rate of payment.
The Parental Income Test may affect:
- whether you qualify for Youth Allowance
- if you qualify, how much Youth Allowance you get
The amount of Youth Allowance you receive each fortnight is worked out using either the Parental Income Test or the Personal Income Test if applicable depending on which test has the greater effect on your payment.
In some circumstances such as when parental income decreases or increases substantially, the Parental Income Test will be based upon your parental income in the current tax year.
Family Assets Test
The Family Assets Test takes into account personal, business and farm assets. The test is based on how much your family would receive for the assets if they sold them, less any debts or mortgages they owe.
The family home is not included in the assets test, and a 75 per cent discount is applied to business and farm assets. You cannot receive Youth Allowance if your family's assets exceed the threshold of $627,000.
Family Actual Means Test
The Family Actual Means Test such as family spending and savings applies if one or both of your parents in the previous financial year:
- had an interest in a trust, private company or unlisted public company
- were self-employed (except as a sole trader engaged wholly or mainly in primary production) or a partner in a partnership
- earned in excess of A$2,500 (including tax exempt from income) from a source in Norfolk Island or outside Australia
- were a wage or salary earner who claimed or will claim a tax deduction for a business loss (whether current or carried forward) that does not consist of a net investment loss in partnership income tax returns
- had an interest in assets held outside Australia in excess of A$2,500, or
- is a migrant who first entered Australia under a business skills category (business migrant) in the last 10 years
Where the Family Actual Means Test applies, details of all personal spending and savings by parents and all dependent family members must be supplied. This assists us to measure what was spent and saved in the previous financial year. We will add the appropriate level of tax (including the Medicare levy) to the total spent and saved. This figure is the amount used for the Parental Means Test calculation.
If there has been a substantial decrease in spending and savings, in certain circumstances family actual means in the current tax year may be used.
Where a family member receives Exceptional Circumstances Relief Payment the Parental Means Test does not apply.
You can use our Online Estimators to help you work out whether you are eligible for student income support and what your payment amount is likely to be.