Paid Parental Leave scheme payments are counted as income

For children born or adopted on or after 1 October 2016, we count Parental Leave Pay and Dad and Partner Pay as income, for income support payment eligibility.

How this affects your income support payment

We assess your and your partner’s income to work out your eligibility and payment rate for income support payments. We do this when you or your partner make a claim and throughout the duration of the payment. This helps us to pay you the right amount.

For children born or adopted on or after 1 October 2016, all Paid Parental Leave scheme payments are included in the income we assess. This includes Parental Leave Pay (PLP) and Dad and Partner Pay (DaPP).

When we count PLP and DaPP as income, your and your partner’s total income increases. This could mean a decrease of your or your partner’s existing income support payment, or a lower rate for a new payment. It could make you ineligible if your and your partner’s total income is too high.

Read more about income to see what we assess.

If your or your partner’s income support payment is reduced while you’re getting PLP or DaPP, we will automatically reassess it once your PLP or DaPP ends.

To find out what effect PLP or DaPP will have on your payment, you can use our Payment and Service Finder.

How to minimise an overpayment

If you or your partner are already getting an income support payment and choose to backdate your PLP or DaPP to the child’s date of birth, you will incur an income support overpayment which you’ll have to repay. This is because we previously assessed your rate of payment based on your and your partner’s income without PLP or DaPP. To minimise overpayments, you can choose a PLP or DaPP start date in the future. However, to receive the full 18 weeks of PLP, you must submit a claim and choose a start date within 34 weeks of your child’s birth or adoption.

Read more about claiming Parental Leave Pay.

If your income support payment is cancelled

Your income support payment will cancel if your or your partner’s income, including PLP and DaPP, is too high. If this happens you can submit a new claim when your PLP or DaPP ends.

Cancellation will also affect your concession cards and Family Tax Benefit.

Children born or adopted before 1 October 2016 are not affected

If your child was born or adopted before 1 October 2016, PLP and DaPP won’t affect your or your partner’s income support payment. You can still submit your claim for PLP or DaPP after 1 October, as we only look at the birth or adoption date.

Choosing the payment that’s right for you

Depending on your circumstances, you and your partner may choose to get Newborn Upfront Payment and Newborn Supplement instead of PLP. You will need to decide which payment is best for you. However, once you have started being paid PLP, you can’t change to Newborn Upfront Payment and Newborn Supplement.

Page last updated: 13 June 2017