How we use adjusted taxable income

What you claim determines how we work out your adjusted taxable income.

Income we use for child support is different to what we use for family assistance. For some payments, we’ll deduct any child support you pay from your adjusted taxable income.

Family assistance payments

We'll use your adjusted taxable income to work out if you can get:

The types of income we look at are:

  • taxable income
  • reportable fringe benefits
  • reportable superannuation contributions
  • total net investment losses
  • certain tax free pensions and benefits
  • foreign income
  • tax exempt foreign income.

We’ll deduct any child support you pay from your adjusted taxable income for family assistance.

Child support

We’ll use your adjusted taxable income to work out your child support payments. The types of income we look at are:

  • taxable income
  • reportable fringe benefits
  • reportable superannuation contributions
  • total net investment losses
  • certain tax free pensions and benefits
  • target foreign income.

We’ll use your adjusted taxable income for the last relevant year, not the current year. Read more about how your income affects your child support.

Commonwealth Seniors Health Card

We’ll use your adjusted taxable income to work out if you can get a Commonwealth Seniors Health Card. The types of income we’ll look at are:

  • taxable income
  • target foreign income
  • total net investment losses
  • employer provided benefits
  • reportable superannuation contributions.

We’ll add deemed income from account based income streams to your adjusted taxable income.

Carer Allowance and Carer Allowance Health Care Card

There’s no assets test for Carer Allowance or Carer Allowance Health Care Card but there is an income test.

The Carer Allowance income test doesn’t apply to you if you or your partner get:

  • an income tested income support payment from Centrelink or the Department of Veterans’ Affairs
  • a Commonwealth Seniors Health Card
  • Family Tax Benefit by fortnightly instalments.

You and your partner’s combined adjusted taxable income must be under $250,000 a year to get:

  • Carer Allowance
  • Carer Allowance Health Care Card.

This includes the deemed income from your account-based income streams. The same limit applies to carers who do not have a partner. 

Adjusted taxable income

Adjusted taxable income for Carer Allowance and Carer Allowance Health Care Card is the sum of the following:

  • taxable income
  • target foreign income
  • total net investment losses
  • employer provided benefits above $1,000
  • reportable superannuation contributions
  • tax free pensions and benefits.

Any child support you or your current partner paid in the same financial year won’t count in your income.

Account based income streams

An account based income stream is an investment account set up within a superannuation fund.

We add the deemed income to your or your partners adjusted taxable income. We work this out from the current account balance of an account based income stream.

Account based income streams for Carer Allowance and Carer Allowance Health Care Card are any long term financial assets. They can also be called:

  • allocated pensions
  • allocated annuities
  • transition to retirement pensions.

We only count deemed income from an account based income stream in your or your partners adjusted taxable income. We do this if the account holder is 60 or older.  This is because the income from account based income streams is tax free from this age.

Providing a current year estimate

You should provide your most recent details verified by the Australian Taxation Office.

If your income was over the limit you may not be eligible for Carer Allowance.

We can only accept a current year estimate if you have had a change in your circumstances. This has to be for an allowable reason. For example, the change has already occurred and you have evidence that shows the change significantly affected your income.

Current year estimate allowable reasons:

  • Retirement or partial retirement from the workforce, business closure or receipt of an inheritance.
  • Ongoing reduced working hours because the person you care for needs more care from you.
  • Substantial loss of income caused by a catastrophic event or natural disaster such as a fire, flood or cyclone.
  • A substantial one off cost because of the disability or medical condition of the person you provide care for.

Page last updated: 17 June 2019