Strategic Financial Solutions Pty Ltd: Sickness Allowance

Sickness Allowance

Reproduced from Centrelink's "A Guide to Australian Government Payments 1 January - 19 March 2012"

Basic Conditions of Eligibility
Residence Requirements
Basic Rates
Rent Assistance
Assets Test
Income Test

Basic Conditions of Eligibility

Aged 21 or over and under Age Pension age, and
Temporarily incapacitated for work (or full-time study and on Austudy or ABSTUDY).
Must have a job or full-time study to which they can return.
A medical certificate from a qualified medical practitioner must be supplied.
Not payable to Youth Allowance recipients who become incapacitated for study.

Residence Requirements

Must be an Australian resident.
Available to newly arrived migrants after 104 weeks in Australia as an Australian resident (some exemptions may apply).
May be paid for up to 13 weeks of temporary absence from Australia in certain limited circumstances.

Basic Rates

Single, no children	$486.80 pf
Single, with dependant children	$526.60 pf
Single, aged 60 or over, after nine months	$526.60 pf
Partnered (each)	$439.40 pf
Single, principal carer of a dependent child (granted and exemption for foster caring/home schooling/distance education/large families	$641.50 pf

Pharmaceutical Allowance is paid.

Rent Assistance

Family Situation Maximum payment per fortnight No payment if your fortnightly rent is less than Maximum payment if your fortnightly rent is more than

Single, no children $119.40 $106.20 $265.40

Single, no children, sharer $79.60 $106.20 $212.33

Couple, no children $112.60 $172.80 $322.93

One of a couple who are separated due to illness, no children* $119.40 $106.20 $265.40

One of a couple who are temporarily separated, no children $112.60 $106.20 $256.33

*Includes respite care and partner in prison.

Rent Assistance for families with children is usually paid with Family Tax Benefit. See Family Tax Benefit Part A for current rates.
Rent Assistance is not paid:
- to people paying rent to a government housing authority, although in some situations sub-tenants may qualify for Rent Assistance.
- for residents of Australian Government funded nursing homes and hostels.
- to single Disability Support Pensioners under 21, without dependants, living with parents.
- to other single people aged under 25, living with parents.
Special rules apply to single sharers, people who pay board and lodging or live in a retirement village.
Rent Certificates are required to verify rent where the person does not have a formal tenancy agreement or is not named as a tenant on a formal tenancy agreement.
Rent Assistance is paid as part of another payment. It may be reduced due to the income test rules applying to that primary payment.
Rent Assistance is subject to portability provisions where relevant.

Rent Assistance is not available to single people aged under 25, without dependants, who live with their parent or guardian.
Where both members of a couple without children are receiving an allowance or benefit, the Rent Assistance is shared.

Income Test

Family Situation For full
Allowance (pf)* For part
Allowance (pf)**

Single no children up to $62 less than $904.67

Single aged over 60 after nine continuous months on payment up to $62 less than $981.00

Single, with dependent child(ren) up to $62 less than $971.00

Partnered (each) up to $62 less than $825.67

Single, principal carer of a dependent child (granted an exemption for foster caring/home schooling/distance education/large family) up to $62 less than $1,162.50

*
Fortnightly income between $62 and $250 reduces fortnightly allowance by 50 cents in the dollar.

For income above $250 per fortnight, fortnightly allowance reduces by 60 cents in the dollar.

Partner income which exceeds the cut-off point reduces fortnightly allowance by 60 cents in the dollar.

** These figures may be higher if you are eligible for Pharmaceutical Allowance or Rent Assistance.

Working Credit

Working Credit helps working-age people to keep more of their income support payment when they take up work. When people have little or no income, they will build up "working credits". Then if they do work, their working credits increase the amount they can earn before their income support payment is reduced. For example, someone with 150 working credits is able to earn an extra $150 above the income free area before their payment starts to reduce.

It also helps people who take up short-term jobs by making it easier for them to get their payments restarted (for up to 12 weeks). This means that people don't have to reapply for payments, they just need to prove that their job has ended, or that their income has dropped, and Centrelink will restart their payments.

Assets Test

Assets Test Limits for Allowances and Full Pensions

Family Situation	For Home Owners	For Non-homeowners
Single	$186,750	$321,750
Couples (combined)	$265,000	$400,000
Illness separated (couple combined)	$265,000	$400,000
One partner eligible (combined assets)	$265,000	$400,000

Some assets are deemed to earn income, while certain assets are not included in the assets test; see Deeming - Financial Investments or contact Centrelink for more information.

Allowances, Austudy and Parenting Payment are not payable if assets exceed these amounts.

For pensions, assets over these amounts reduce pension by $1.50 per fortnight for every $1,000 above the amount (single and couple combined).

Assets Test Limits for Part Pensions

	For Part Pensions Assets must be less than:#
Family Situation	For Homeowners	For Non-homeowners
Single	Up to $686,000	Less than $821,000
Partnered (combined)	Up to $1,018,000	Less than $1,153,000
Illness separated (couple combined)	Up to $1,263,500	Less than $1,398,500
One partner eligible	Up to $1,018,000	Less than $1,153,000

Transitional

Family Situation	For Homeowners	For Non-homeowners
Single	Up to $631,750	Less than $766,750
Partnered (combined)	Up to $983,500	Less than $1,118,500
Illness separated (couple combined)	Up to $1,155,000	Less than $1,290,000
One partner eligible	Up to $983,500	Less than $1,118,500

Assets Test for Disability Support Pension - Aged under 21 (no children)

Family Situation	For Homeowners	For Non-homeowners
I) Single - dependent
16-17 years	Up to $414,000	Less than $549,000
18-20 years	Up to $443,750	Less than $578,750
II) Single - independent
16-20 years	Up to $535,500	Less than $670,500
III) Couple (combined)
16-20 years	Up to $958,500	Less than $1,093,500

Some assets are deemed to earn income, while certain assets are not included in the assets test; see Deeming - Financial Investments or contact Centrelink for more information.

Note: The rate of payment is calculated under both the income and assets tests. The test that results in the lower rate (or nil rate) will apply.

# Limits will increase if Rent Assistance is paid with your pension.

The asset limits above may only apply to people who are resident in Australia, or are temporarily absent for up to 13 weeks. Contact Centrelink for more information.

Extra Allowable amount for Retirement Village and Granny Flat Residents

If your Entry Contribution is equal to or less than the Extra Allowable Amount, you are assessed as a non-homeowner. Your Entry Contribution will count as an asset. You may qualify for Rent Assistance. The Extra Allowable Amount is the difference between the non-homeowner and homeowner test limits, currently $135,000.

Hardship Provisions

If you have assets but little or no income you are expected to rearrange your affairs to provide for yourself. In some cases that is not possible. If you are in "severe financial hardship" you may be able to get a social security payment. Different tests apply to such cases.