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13.6.2 Family Tax Benefit (FTB)


13.6.2  Family Tax Benefit (FTB)

FTB is a two part payment that helps with the cost of raising children and is a payment made by the Department of Human Services to a family for general costs, not specifically to help with education costs. Family Tax Benefit (FTB) payments are non-taxable and there is no capacity to make FTB payments to the child. The broader scope of FTB means that the benefits derived from it extend to the whole family - not only to the students in the family. This should be taken into consideration when families with secondary school students aged 16-17 are deciding whether to receive FTB or an education allowance under the Education Schemes, as some families may be financially better off to remain on FTB until the child finishes secondary schooling. Both DVA and Centrelink can assist the family in deciding which payment is more financially beneficial.

If a family chooses to receive FTB payments, the child is still eligible for guidance, counselling and tuition under the Education Schemes. Following legal advice provided to DVA, generally (special) financial assistance may also be paid. See section 13.5.3 of the Education Schemes policy manual for further information.

Special Case – separated parents

Where the parents of a child are separated, it may be that one parent wishes to receive a share of FTB (according to their FTB shared care percentage) from Services Australia, while the child’s other parent wishes to receive an amount of VCES payment that corresponds with their shared care percentage from DVA.

There is no bar in policy from either DVA or the Department of Social Services/Services Australia from this occurring.  The relevant family assistance law (s22A of the A New Tax System (Family Assistance) Act 1999) precludes an individual from receiving both payments at once. As the explanatory memorandum confirms, this is to prevent an individual receiving both payments at the same time, and is not intended to preclude one member of a shared care separated couple from choosing to make a different choice than their ex-partner.

Therefore, in cases where parents are separated, share care of a child, and one parent wishes to surrender VCES and continue receiving their percentage of FTB, but the other parent wishes to surrender FTB and continue receiving their percentage of VCES, no individual is receiving both payments at the same time, so the notion of “double-dipping” does not apply and the intent of the law is served.