February 2013 Newsletter

In this edition:

Welcome

How to access the Schoolkids Bonus

What happens to my super when I die?

The new Director Penalty Regime - important dates

SMSF investment in property takes care

With the start of a new year, parents begin adding up the cost of putting their kids through school. The government does offer some relief with the Schoolkids Bonus (previously known as the Education Tax Refund).

Eligibility for Schoolkids Bonus

Unlike the Education Tax Refund, you don't need to claim the Schoolkids Bonus and you won't need to keep any receipts for education purposes.

To be eligible for the Schoolkids Bonus, you must either be a parent or carer who receives Family Tax Benefit Part A for a dependent child who is:

• Under 16 years of age and in primary or secondary full-time education;
• 16 to 18 years of age and in full-time secondary study or exempt from full-time study; or
• Turning 19 years of age in the calendar year and in full-time secondary study, or exempt from full-time secondary study.

The Schoolkids bonus will be paid to primary and full-time secondary students if they are up to 18 years old or turning 19 years old in the calendar year, and receiving:

• Youth Allowance
• ABSTUDY (Living Allowance)
• Disability Support Pension
• Carer Payment
• Parenting Payment
• Special Benefit, or
• An Education Allowance from the Department of Veterans' Affairs
• Children in preschool are not eligible.
  
  Payment rates for Schoolkids Bonus
  Eligible families will receive:
  two instalments of $205 for each child in primary school - a total of $410 each year
• two instalments of $410 for each child in secondary school - a total of $820 each year.

How you will be paid
The Schoolkids Bonus will be paid in January and July each year from 2013 onwards.

If you currently receive Family Tax Benefit Part A:

• and receive fortnightly payments, your first Schoolkids Bonus payment will be made from 9 to 23 January 2013;
• and claim Family Tax Benefit as a lump sum, you will get your Schoolkids Bonus payment (if eligible) when your lump sum claim is assessed

Eligibility for Family Tax Benefit Part A
 You may be eligible for Family Tax Benefit Part A if you have a dependent child:

• under 16 years of age;
• aged 16 or 17 who has completed a Year 12 or equivalent qualification; or
• aged 16–19 years of age (up to the end of the calendar year they turn 19) and who is undertaking full-time education or training in an approved course leading to a Year 12 or equivalent qualification; has an acceptable study load; or has been granted an exemption from this requirement,
• You will also need:
  to have care of the child for at least 35 per cent of the time and
• to satisfy the income test.

Income Test
If your family's adjusted taxable income for this financial year is $47,815 or less, your payment will not be affected by the income test.

If your adjusted taxable income is more than $47,815 for this financial year, your payment will reduce by 20 cents for each dollar above $47,815 until your payment reaches the base rate of Family Tax Benefit Part A.

Your Family Tax Benefit Part A will stay at that rate until your family's adjusted taxable income reaches $94,316 a year (plus $3,796 for each Family Tax Benefit child after the first). Family Tax Benefit Part A will reduce by 30 cents for every dollar over that amount until your payment reaches nil.

If your family income is close to the limit cut-off, you should check your eligibility after the end of the financial year, once your actual income is known.

The income test does not apply if you or your partner get an income support payment, such as a pension, benefit or allowance or a Department of Veterans' Affairs service pension.

You may not be eligible for Family Tax Benefit Part A if your child earns over the child-income limit.

Child-income limit
In certain circumstances, the amount of income that a child earns during an income year can affect your eligibility for Family Tax Benefit. You will not be eligible for Family Tax Benefit if your child earns $13,775 or more during the income year and is:

• aged 5 to 15 and is not studying full time
• aged 16 to 19 and is not in, or has an exemption from full-time secondary study.

Immunisation requirements for Family Tax Benefit Part A
From 1 July 2012, parents need to have had their children immunised during the financial years that each child turns one, two and five years of age to meet the immunisation requirement. If you believe you are eligible to claim Family Tax Benefit you can submit your claim online or in person at www.humanservices.gov.au.

Contact us at Goodwin Chivas & Co if you have any queries.