Effect of Children on Ordinary/Adjusted Income Free Area

Last amended: 20 September 2009

Note: From 20 September 2009, the information provided under this topic applies only to those assessed under transitional rules.

Ordinary/adjusted income free area increased

The ordinary/adjusted income free area used in calculating a person's service pension or income support supplement is increased for:

• each dependent child under 18 years,
• each youth allowance recipient under 18 years,
• each dependent child over 18 who is not a prescribed student child within the meaning of the Social Security Act 1991, and
• each dependent child over 18 who is a prescribed student child and in respect of whom a carer allowance under the Social Security Act 1991 is being paid to the service pension or income support supplement recipient or their partner.

Effect of child payments on the additional free area

Generally, payments received for or in respect of a dependent child reduce the additional free area. Examples of these kind of payments are:

• amounts received from State authorities in respect of the boarding out of the child,
• foster care allowance payments made by a State welfare authority.

Additional ordinary/adjusted income free area reduced

When a payment is received in respect of the dependent child, the additional free area for a dependent child of a pensioner may be reduced as shown in the following table.

Additional free area not reduced

The additional free area is not reduced by the following payments in respect of a dependent child:

• a payment made under the VEA or the Social Security Act 1991,
• a payment of maintenance income,
• a payment under an Aboriginal study assistance scheme, or
• a payment under the Assistance for Isolated Children Scheme.