Under the scheme, only Additional Boarding Allowance is income tested.
There are two parts to the parental means test:
- parental income test, and
- maintenance income test
Parental income and boarding costs
In 2018, we look at your income for the 2016-17 financial year.
How your income for tax year 2016-17 affects your payment
|Parental income||Effect on payment|
|$52,706 or less||No change. But the maintenance income test can still affect it.|
|More than $52,706||Reduced by 20 cents for every dollar over. This depends on the number of children in your family pool.|
Boarding costs affect the amount of Additional Boarding Allowance you get. Boarding costs include boarding charges, plus $250 to cover items like laundry and toiletries. Boarding charges are the net boarding fees actually charged by the institution. It doesn't include fees for tuition or items relating to it.
In 2018, if the boarding charges for that year are $7,999 or less, you can only get Basic Boarding Allowance.
If the boarding charges for the year are more than $7,999 in 2018, the amount of Additional Boarding Allowance will be the lower amount of:
- the maximum annual rate less any reduction from the parental income test or the maintenance income test, or
- the level of annual boarding costs for the student that’s more than the Basic Boarding Allowance amount
Types of income tested
The parental income test uses parents' or guardians' combined taxable and other income for the tax year prior to the child's study year. We call this the base tax year.
If your child is studying in 2018, we use the combined parental income for the 2016-17 tax year.
Parental income includes:
- combined parental taxable income
- tax free pensions and benefits
- fringe benefits
- income from outside Australia
- reportable superannuation contributions, and
- total net investment losses such as negative gearing losses for that tax year
We deduct child support or maintenance you pay for a former partner from the parental income.
If you want to claim Additional Boarding Allowance and haven’t given us your income details, call us.
The family pool refers to the dependent children in your family who may affect the amount of Additional Boarding Allowance you get.
Your family pool includes dependent children who:
- get Youth Allowance, ABSTUDY Living Allowance or income tested School Fees Allowance Group 2
- you get Assistance for Isolated Children Additional Boarding Allowance for, or
- are aged up to 19 years old, and, if aged between 16 to 19, attend secondary school
If there’s a shared care arrangement in place for a child in your family, we may take this into account.
You may be eligible for a higher rate of Additional Boarding Allowance if:
- you don’t get the maximum rate of Additional Boarding Allowance
- parental income is over $52,706 if the student is studying in 2018, and
- there are 2 or more dependent children in the family pool
You may get Additional Boarding Allowance when parental income is higher than the limit if:
- you’re eligible for Family Tax Benefit Part A for the child you’re claiming Additional Boarding Allowance for, or
- there are 2 or more dependent children in the family pool
If you need to update your family details, call us.
Changes to parental income in the study year
If you get Additional Boarding Allowance, you must tell us if there’s any changes to parental income. Sometimes, changes to parental income can mean your payment rate changes. Your payment may also change if your child's circumstances change.
Where there’s been a change to parental income, we can work out the parental income test on their income for the current tax year. For example, if your child is studying in 2018 and parental income significantly changes, we may use parental income for the 2017-18 tax year.
If your child is studying in 2018, you need to tell us if parental income:
- increases more than 25% from the 2016-17 tax year
- decreases significantly, and you think it will reduce for 2 years or more
You need to tell us about changes in your income so we pay you the right amount. You can do this using the Assistance for Isolated Children (AIC) Current Tax Year Assessment form. You can submit it online, by post, fax or at a service centre.
If you can’t print the form:
Periods we exclude from the parental income test
The parental income test won’t apply if you or your partner:
- get an income support payment – but not Family Tax Benefit, or
- get ABSTUDY Living Allowance, or
- have a Health Care Card, but not a:
When we calculate your Additional Boarding Allowance and the parental income test doesn’t apply, we’ll look at:
- your child's actual boarding costs, and
- your maintenance income
Maintenance income test
We consider the amount of child support or voluntary maintenance you get when we work out your payment.
You need to tell us about any voluntary maintenance you get if we have not made a child support assessment. If we have made a child support assessment, you don’t need to tell us these details again. We'll use information we already have to adjust your payment.
Maintenance income can include:
- cash, lump sum payments and non-cash amounts
- utilities charges, and
- school fees and other payments made on behalf, or for the benefit, of your child
You may be exempt from this test if you or your partner:
- are permanently blind, and
- Age Pension
- Disability Support Pension, or
- a Department of Veterans’ Affairs Service Pension, Veteran Payment or Income Support Supplement
The maintenance income test won’t always affect your payment. You or your partner may fall under the maintenance income free area. It’s the amount of child support or voluntary maintenance you both get before maintenance income affects your payment.
The number of children you have and payments they get can also affect this amount.
Maintenance income free area per year
|When you get maintenance income for:||The maintenance income free area is|
|Just the child who is studying||$1,620.60|
|The child and other siblings who get Youth Allowance, ABSTUDY Living Allowance or School Fees Allowance Group 2||$1,620.60 plus $540.20 for each sibling. Then divide the total by the number of children|
|The child and other siblings who are eligible for Family Tax Benefit or Assistance for Isolated Children Additional Boarding Allowance||$540.20|
Example of maintenance income free area calculation
Michael has 3 children. Michael gets Assistance for Isolated Children Additional Boarding Allowance for one child. Michael’s other 2 children get Youth Allowance. We calculate Michael’s maintenance income free area by adding the income free area for each child and dividing by 3.
The maintenance free area for the first child is $1,620.60. We add $540.20 for each of the 2 other children. We divide the total amount $2,701, by the total number of children. So, Michael’s maintenance income free area is $900.33.
Balancing your Assistance for Isolated Children Additional Boarding Allowance payments
We use your child support assessment or voluntary maintenance to estimate your annual maintenance income. This can change throughout the year.
At the end of the financial year, we’ll balance your payments based on the actual maintenance income you got.
We’ll let you know if we paid you too much or not enough.