Federal Budget 2015/2016 Edition

In this edition:

Welcome

Small Business Measures

Measures affecting individuals

Retirement Income Measures

Measures affecting families

Measures affecting families

2015/2016 Federal Budget

1. Child care (workforce participation stream)
A new single Child Care Subsidy ('CCS') will be introduced on 1 July 2017. Families meeting the activity test with annual incomes up to $60,000 will be eligible for a subsidy of 85% of the actual fee paid, up to an hourly fee cap. The subsidy will taper to 50% for eligible families with annual incomes of $165,000.

The CCS will have no annual cap for families with annual incomes below $180,000. For families with annual incomes of $180,000 and above, the CCS will be capped at $10,000 per child per year. Eligibility will be linked to a new activity test.

The CCS will replace the current child care fee assistance provided by the Child Care Benefit, Child Care Rebate and the Jobs, Education and Training Child Care Fee Assistance payments which will cease on 30 June 2017.

Additional support will be provided to eligible disadvantaged or vulnerable families through the introduction of a 'Child Care Safety Net'.

Child care subsidies will remain linked to immunisation requirements strengthened, from 1 January 2016, under the Government's "no jab, no pay" policy.

Furthermore, the 2015/16 Federal Budget announces the introduction of a new Interim Home Based Carer Subsidy Programme, which is a limited pilot programme to subsidise care provided by a nanny in a child's home from 1 January 2016.

2. Cessation of the Large Family Supplement of Family Tax Benefit (FTB) Part A and reduced portability
The government will cease payment of the additional FTB Part A Large Family Supplement from 1 July 2016. Families will continue to receive a per child rate of FTB Part A for each eligible child in their family.

The government will also reduce the amount of time FTB Part A will be paid to recipients who are outside Australia. Currently, FTB Part A recipients who are overseas are able to receive their usual rate of payment for six weeks and then the base rate for a further 50 weeks. From 1 July 2016, families will only be able to receive FTB Part A for six weeks in a 12 month period while they are overseas.

If you have any questions about how these measures may impact your family, please contact the team at Goodwin Chivas & Co.