Tax returns and Centrelink issues

Completing our yearly tax returns is one of those life admin tasks that seem to come around too quickly and can be a bit of a nuisance. For many, the anticipation of a tax refund is an incentive to get it done. Every year at SSRV though, we speak to people who, despite being required to submit an income return, don’t do it.

Some feel the task is overwhelming or simply haven’t got around to it. Others, though, may have been coerced into not submitting an income tax return, or be under the misconception that they do not need to complete it.

At SSRV, we know the value of preventative actions and we do our best to ensure that clients will not need our services – and completing an income tax return is an important step in making sure you, or the person you are supporting, don’t end up in a Centrelink dispute.

A common reason workers and individuals call SSRV, is debts or ongoing payment issues relating to lodgement or non-lodgement of a tax return. Family Tax Benefit and Child Care Subsidy cancellation and debts, related to the absence of a return being lodged, or of making Centrelink aware that lodgement is not required, is a common theme.

The message from Services Australia is clear: If you receive a Centrelink payment or pay or receive child support, you should check to see if you need to lodge a tax return.

Family Tax Benefit and Child Care Subsidy

If you receive Family Tax Benefit or Child Care Subsidy, you need to tell Centrelink if you are not required to lodge a tax return.  You can update Centrelink about non-lodgement of a tax return via your MyGov account, or by speaking with a Centrelink officer. You can find more information here.

If you don’t lodge a tax return as required, or you don’t tell Centrelink that you aren’t required to lodge a tax return, your ongoing payments may stop and you may receive a debt notice. For Family Tax Benefit and Child Care Subsidy, Centrelink relies upon lodgement or non-lodgement of tax returns to recalculate payment entitlements. If you don’t give Centrelink the information they need to recalculate and confirm your entitlements, it’s likely Centrelink will cancel ongoing payments and require you to pay back any FTB or CCS you have received.


The ATO have recently developed a step-by-step tool to assess whether a return needs to be lodged

There is also assistance in completing a return when required and help for those facing particular challenges.

So, if you or someone you are supporting, is receiving a Centrelink payment, now is the time to check if an income tax return needs to be submitted, and if so, don’t put it off.

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