Commonwealth: Child Support and Family Assistance Legislation Amendment (Budget and Other Measures) Act 2010 (Cth)

Child Support and Family Assistance Legislation Amendment (Budget and Other Measures) Act 2010 No. 65, 2010 An Act to amend the law relating to child support and family assistance, and for other purposes Contents 1 Short title 2 Commencement 3 Schedule(s) Schedule 1—Child support income estimates Part 1—Amendments Child Support (Assessment) Act 1989 Child Support (Registration and Collection) Act 1988 Part 2—Transitional provisions Schedule 2—Percentage of care Part 1—Amendments A New Tax System (Family Assistance) Act 1999 A New Tax System (Family Assistance) (Administration) Act 1999 Child Support (Assessment) Act 1989 Child Support (Registration and Collection) Act 1988 Income Tax Assessment Act 1936 Part 2—Application and transitional provisions Division 1—Definitions Division 2—Amendments of the child support law Division 3—Amendments of the family assistance law Division 4—Application of amendments in relation to Western Australian exnuptial children Schedule 3—Non‑payment of family tax benefit for non‑lodgment of tax returns A New Tax System (Family Assistance) (Administration) Act 1999 Schedule 4—Other amendments A New Tax System (Family Assistance) Act 1999 Child Support (Registration and Collection) Act 1988 Child Support and Family Assistance Legislation Amendment (Budget and Other Measures) Act 2010 No. 65, 2010 An Act to amend the law relating to child support and family assistance, and for other purposes [Assented to 28 June 2010] The Parliament of Australia enacts: 1 Short title This Act may be cited as the Child Support and Family Assistance Legislation Amendment (Budget and Other Measures) Act 2010. 2 Commencement (1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms. Commencement information Column 1 Column 2 Column 3 Provision(s) Commencement Date/Details 1. Sections 1 to 3 and anything in this Act not elsewhere covered by this table The day this Act receives the Royal Assent. 28 June 2010 2. Schedules 1 and 2 1 July 2010. 1 July 2010 3. Schedule 3, items 1 to 12 1 July 2010. 1 July 2010 4. Schedule 3, items 13 to 15 Immediately after the commencement of item 6 of Schedule 2 to the Family Assistance Amendment (Further 2008 Budget Measures) Act 2009. 1 July 2010 5. Schedule 4, item 1 1 July 2010. 1 July 2010 6. Schedule 4, items 2 and 3 Immediately after the commencement of the provisions covered by table item 2. 1 July 2010 Note: This table relates only to the provisions of this Act as originally passed by both Houses of the Parliament and assented to. It will not be expanded to deal with provisions inserted in this Act after assent. (2) Column 3 of the table contains additional information that is not part of this Act. Information in this column may be added to or edited in any published version of this Act. 3 Schedule(s) Each Act that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms. Schedule 1—Child support income estimates Part 1—Amendments Child Support (Assessment) Act 1989 1 Subsection 5(1) (at the end of the definition of adjusted taxable income) Add "and subsections 61(1) and 63(1)". 2 Subsection 5(1) Insert: applicable YTD income amount has the meaning given by subsections 63AF(1) and (2). 3 Subsection 5(1) Insert: application period has the meaning given by: (a) for an election made under subsection 60(1)—subsection 61(1A); and (b) for an election made under subsection 62A(1)—subsection 63(2). 4 Subsection 5(1) Insert: determined ATI has the meaning given by paragraph 64AB(2)(a). 5 Subsection 5(1) Insert: estimated ATI amount has the meaning given by subsections 64A(3) and 64AD(3). 6 Subsection 5(1) Insert: income component amounts has the meaning given by subsection 60(2). 7 Subsection 5(1) Insert: income election means an election made under subsection 60(1) or 62A(1). 8 Subsection 5(1) Insert: partial year income amount has the meaning given by: (a) for an election made under subsection 60(1) to which subsection 60(3) applies—step 2 of the method statement in subsection 60(4); and (b) for an election made under subsection 62A(1)—step 2 of the method statement in that subsection. 9 Subsection 5(1) (definition of remaining period) Repeal the definition, substitute: remaining period has the meaning given by: (a) for an election made under subsection 60(1) to which subsection 60(3) applies—step 1 of the method statement in subsection 60(4); and (b) for an election made under subsection 62A(1)—step 1 of the method statement in that subsection. 10 Subsection 5(1) Insert: start day for an income election means the day specified in the notice of the income election under subsection 60(8) or 62A(5) as the start day for the income election. 11 Subsection 5(1) Insert: underestimated an income amount has the meaning given by subsections 64AF(2) and (3). 12 Subsection 43(1) Omit "subsection (2)", substitute "this Part". 13 Paragraph 44(1)(d) Omit "remaining period (if the parent has made an election under section 60)", substitute "application period for an income election (if such an election has been made by the parent)". 14 Section 55J Omit: • A parent can estimate the amount of his or her adjusted taxable income for days in a child support period. Substitute: • A parent can estimate the amount of his or her adjusted taxable income for a year of income. 15 Paragraphs 56(2)(d) and 57(7)(b) Omit "subsection 60(3)", substitute "paragraph 60(1)(b)". 16 Subdivision C of Division 7 of Part 5 (heading) Repeal the heading, substitute: Subdivision C—Child support income determined by reference to parent's estimate of adjusted taxable income 17 Sections 60 to 60B Repeal the sections, substitute: 60 Parent may elect to estimate his or her adjusted taxable income for a year of income (1) A parent may, before a year of income starts or during a year of income, elect that the parent's adjusted taxable income for the year of income is to be the amount that applies under subsection (2) or (3) if: (a) the parent is to be assessed in respect of the costs of a child of the parent for a day in a child support period; and (b) the amount that would apply under that subsection is not more than 85% of: (i) the total of the parent's adjusted taxable income determined in accordance with section 43 for the last relevant year of income for the child support period; or (ii) an amount that the parent declares is the total of the parent's adjusted taxable income for the last relevant year of income for the child support period, and the Registrar is satisfied that the declared amount is correct. Estimate for a whole year of income (2) If the parent makes the election under subsection (1) before the year of income starts or on the first day of the year of income, the amount is the total of the following amounts (the income component amounts) as estimated by the parent: (a) the parent's taxable income for the year; (b) the parent's reportable fringe benefits total for the year; (c) the parent's target foreign income for the year; (d) the parent's total net investment loss (within the meaning of the Income Tax Assessment Act 1997) for the year; (e) the total of the tax free pensions or benefits received by the parent in the year; (f) the parent's reportable superannuation contributions (within the meaning of the Income Tax Assessment Act 1997) for the year. Estimate for a part of a year of income etc. (3) If the parent makes the election under subsection (1) during the year of income but not on the first day of the year of income: (a) the parent is to use the method in subsection (4) to work out the amount; and (b) the parent is to estimate each income component amount for the parent for the period that: (i) started on the first day of the year of income; and (ii) ended at the end of the day before the start day for the election. (4) For the purposes of paragraph (3)(a), the method is as follows: Method statement Step 1. Estimate each income component amount for the parent for the period (the remaining period): (a) starting on the start day for the election; and (b) ending at the end of the last day of the year of income. Step 2. Add up those amounts. The result is the partial year income amount. Step 3. Divide the partial year income amount by the number of days in the remaining period. Step 4. Multiply the quotient by 365. (5) The start day for the election must be: (a) the day on which the parent makes the election; or (b) the first day of a child support period, so long as that day is not before the day referred to in paragraph (a). No election if an income amount order is in force (6) Despite subsection (1), a parent may not make an election if an income amount order is in force in relation to: (a) the parent; and (b) if the parent were to make such an election—any part of the period that would be the application period for the election. How election is made (7) The parent makes the election under subsection (1) by giving notice of it to the Registrar in the manner specified by the Registrar. (8) The notice must specify: (a) the amount that applies under subsection (2) or (3); and (b) if subsection (2) applies—each of the income component amounts estimated by the parent under that subsection; or (c) if subsection (3) applies: (i) the day that is the start day for the election; and (ii) each of the income component amounts estimated by the parent under paragraph (3)(b) and under step 1 of the method statement in subsection (4). 18 Subsection 61(1) Repeal the subsection, substitute: (1) If: (a) a parent makes an election under subsection 60(1) relating to a year of income; and (b) the parent is to be assessed in respect of the costs of a child of the parent for a day in a child support period; and (c) the day occurs in the application period for the election; then, for the purposes of so assessing the parent, the parent's adjusted taxable income is the amount that applies under subsection 60(2) or 60(3). (1A) The application period for an election under subsection 60(1) relating to a year of income is the period that: (a) starts: (i) if the parent made the election before the year of income started or on the first day of the year of income—on the first day of that year of income; or (ii) otherwise—on the start day for the election; unless the election is revoked before that day; and (b) ends: (i) at the end of the last day of that year of income; or (ii) if the parent revokes the election before that day and makes another election (the later election) under subsection 62A(1) relating to the year of income—at the end of the day before the start day for the later election. 19 Subsection 61(2) Omit "child support period", substitute "application period for the election". 20 Subsections 61(3) and (4) Omit "and the child support period". 21 Subsection 62(1) Repeal the subsection, substitute: (1) A parent who has made an income election relating to a year of income may, by notice given to the Registrar, revoke the income election. Note: If the application period for the income election has started, the parent must make a new election under subsection 62A(1). Note: The heading to section 62 is altered by inserting "income" before "election". 22 Subsection 62(3) Repeal the subsection. 23 After section 62 Insert: 62A Parent must elect a new estimate of his or her adjusted taxable income for a year of income (1) If: (a) under subsection 62(1), a parent revokes an income election (the earlier election) relating to a year of income; and (b) at the time of the revocation, the application period for the earlier election has started; the parent must elect that the parent's adjusted taxable income for the year of income is to be the amount the parent works out as follows: Method statement Step 1. Estimate each income component amount for the parent for the period (the remaining period): (a) starting on the start day for the election made under this subsection; and (b) ending at the end of the last day of the year of income. Step 2. Add up those amounts. The result is the partial year income amount. Step 3. Divide the partial year income amount by the number of days in the remaining period. Step 4. Multiply the quotient by 365. Start day (2) Subject to subsection (3), the start day for the election under subsection (1) must be the day on which the parent makes that election. (3) If: (a) an event affecting the accuracy of an estimate on which the earlier election is based has occurred; and (b) the amount that would be worked out under subsection (1) for an election under that subsection if the start day for that election was the day on which the event occurred is more than: (i) if subsection 60(2) or (3) applied to the earlier election—the amount that applied under that subsection; or (ii) if the earlier election was made under subsection (1) of this section—the amount worked out under that subsection; the start day for the election under subsection (1) of this section must be the day on which the event occurred. How election is made (4) The parent makes the election under subsection (1) by giving notice of it to the Registrar in the manner specified by the Registrar. (5) The notice must specify: (a) the amount worked out under subsection (1); and (b) the day that is the start day for the election under that subsection; and (c) each of the income component amounts estimated by the parent under step 1 of the method statement in that subsection. 24 Subsections 63(1) and (2) Repeal the subsections, substitute: (1) If: (a) a parent makes an election under subsection 62A(1) relating to the year of income; and (b) the parent is to be assessed in respect of the costs of a child of the parent for a day in a child support period; and (c) the day occurs in the application period for the election; then, for the purposes of so assessing the parent, the parent's adjusted taxable income is the amount worked out under that subsection. (2) The application period for an election under subsection 62A(1) relating to a year of income is the period that: (a) starts on the start day for the election unless the election is revoked before that day; and (b) ends: (i) at the end of the last day of the year of income; or (ii) if the parent revokes the election before that day and makes another election (the later election) under subsection 62A(1) relating to the year of income—at the end of the day before the start day for the later election. (2A) Subsection (1) has effect subject to an income amount order that applies in relation to the parent and any part of the application period for the later election. Note: The heading to section 63 is altered by omitting "revocation" and substituting "later election". 25 Subsection 63(3) Omit "and any part of the child support period". 26 Subsection 63(4) Omit "section 60", substitute "subsection 62A(1)". 27 Subsection 63(4) Omit "and the child support period". 28 After section 63 Insert: 63AA Registrar may refuse to accept an income election (1) If: (a) a parent makes an income election to which subsection 60(2) applies; and (b) the Registrar is satisfied that the amount worked out under that subsection is less than the amount that the Registrar considers is likely to be the parent's actual adjusted taxable income for the year of income to which the income election relates; the Registrar may refuse to accept the income election. (2) The Registrar may refuse to accept a parent's income election to which subsection 60(3) applies if the Registrar is satisfied that: (a) the partial year income amount for the income election is less than the amount that the Registrar considers is likely to be the parent's actual adjusted taxable income for the remaining period in relation to the income election; or (b) the total of the income component amounts estimated by the parent under paragraph 60(3)(b) for the period referred to in that paragraph is more than the amount that the Registrar considers is likely to be the total of the actual income component amounts for the parent for that period. (3) If: (a) a parent makes an election under subsection 62A(1); and (b) the Registrar is satisfied that the partial year income amount for the income election is less than the amount that the Registrar considers is likely to be the parent's actual adjusted taxable income for the remaining period in relation to the income election; the Registrar may refuse to accept the income election. (4) In making the decision as to whether to refuse to accept the income election, the Registrar: (a) may act on the basis of information that the Registrar has received or obtained as to the financial circumstances of the parent; and (b) may, but is not required to, conduct an inquiry into the matter. (5) Except for the purposes of Parts VII, VIIA and VIII of the Registration and Collection Act (dealing with objections and appeals), if the Registrar refuses to accept the income election, the election is taken never to have been made. 63AB Notice to be given if Registrar refuses to accept an income election (1) If the Registrar refuses under section 63AA to accept an income election, the Registrar must give written notice of the decision to the parent who sought to make the income election. (2) The notice must include, or be accompanied by, a statement to the effect: (a) that the parent may, subject to the Registration and Collection Act, object to the particulars of the assessment in relation to which the parent sought to make the income election; and (b) that if the parent is aggrieved by the decision on the objection, he or she may, subject to that Act, apply to the SSAT for review of the decision. (3) A contravention of subsection (2) in relation to a decision does not affect the validity of the decision. Subdivision D—Year to date income amounts 63AC Parent may elect a new year to date income amount (1) If: (a) either of the following apply: (i) a parent has made an election relating to a year of income under subsection 60(1) to which subsection 60(3) applies; (ii) a parent has made an election in relation to a year of income under this subsection; and (b) the parent becomes satisfied that the following amount (the year to date income amount) is incorrect: (i) if subparagraph (a)(i) applies—the total of the income component amounts estimated by the parent under paragraph 60(3)(b); (ii) if subparagraph (a)(ii) applies—the amount specified under paragraph (3)(a) of this section in the notice of the election; and (c) sections 64, 64A, 64AC and 64AD do not apply in relation to the parent; the parent may elect another amount (the new amount) to replace the year to date income amount for the year of income. (2) The parent makes the election under subsection (1) by giving notice of it to the Registrar in the manner specified by the Registrar. (3) The notice must specify: (a) the new amount; and (b) the parent's estimate of each income component amount for the period referred to in paragraph 60(3)(b). 63AD Registrar may refuse to accept an election of a new year to date income amount Refusal to accept election (1) The Registrar may refuse to accept an election made by a parent under subsection 63AC(1) if the Registrar is satisfied that the amount specified under paragraph 63AC(3)(a) in the notice of the election is more than the amount that the Registrar considers is likely to be the total of the actual income component amounts for the parent for the period referred to in paragraph 60(3)(b). (2) In making the decision as to whether to refuse to accept the election, the Registrar: (a) may act on the basis of information that the Registrar has received or obtained as to the financial circumstances of the parent; and (b) may, but is not required to, conduct an inquiry into the matter. (3) Except for the purposes of Parts VII, VIIA and VIII of the Registration and Collection Act (dealing with objections and appeals), if the Registrar refuses to accept the election, the election is taken never to have been made. Notice of refusal (4) If the Registrar refuses under subsection (1) to accept a parent's election made under subsection 63AC(1), the Registrar must give written notice of the decision to the parent. (5) The notice must include, or be accompanied by, a statement to the effect: (a) that the parent may, subject to the Registration and Collection Act, object to the decision (the original decision); and (b) that if the parent is aggrieved by a later decision on the objection to the original decision, he or she may, subject to that Act, apply to the SSAT for review of the later decision. (6) A contravention of subsection (5) in relation to a decision does not affect the validity of the decision. 63AE Registrar may determine a new year to date income amount (1) If: (a) any of the following apply: (i) a parent has made an election relating to a year of income under subsection 60(1) to which subsection 60(3) applies; (ii) a parent has made an election in relation to a year of income under subsection 63AC(1); (iii) the Registrar has made a determination under this subsection in relation to a parent and a year of income; and (b) the Registrar becomes satisfied that the following amount (the year to date income amount) is incorrect: (i) if subparagraph (a)(i) applies—the total of the income component amounts estimated by the parent under paragraph 60(3)(b); (ii) if subparagraph (a)(ii) applies—the amount specified under paragraph 63AC(3)(a) in the notice of the election; (iii) is subparagraph (a)(iii) applies—the amount specified in the determination; the Registrar may determine another amount to replace the year to date income amount for the year of income. (2) If the Registrar makes a determination in relation to a parent under subsection (1), the Registrar must give written notice of the determination to the parent. (3) The notice must include, or be accompanied by, a statement to the effect: (a) that the parent may, subject to the Registration and Collection Act, object to the determination; and (b) that if the parent is aggrieved by the decision on the objection, he or she may, subject to that Act, apply to the SSAT for review of the decision. (4) A contravention of subsection (3) in relation to a determination does not affect the validity of the determination. 63AF Parent's applicable YTD income amount (1) If: (a) a parent has made an election relating to a year of income under subsection 60(1) to which subsection 60(3) applies; and (b) subsection (2) of this section does not apply in relation to the parent; the total of the income component amounts estimated by the parent under paragraph 60(3)(b) is the parent's applicable YTD income amount for that year. (2) If either or both of the following have occurred: (a) a parent has made one or more elections in relation to a year of income under subsection 63AC(1); (b) the Registrar has made one or more determinations under subsection 63AE(1) in relation to a parent and a year of income; the parent's applicable YTD income amount for the year of income is: (c) the amount specified under paragraph 63AC(3)(a) in the notice of such an election, if that election was the last of those elections or determinations to be made; or (d) the amount determined in such a determination, if that determination was the last of those elections or determinations to be made. Subdivision E—Amendment of assessments 29 Paragraph 63A(1)(a) Repeal the paragraph, substitute: (a) those days occur in the application period for an income election that the parent has made; and Note: The heading to section 63A is altered by inserting "income" before "election". 30 Subsection 63A(2) Omit "the days", substitute "those days". 31 Subsection 63A(2) After "period", insert "that occur". 32 Subsection 63A(3) Omit "the days", substitute "those days". 33 Subsection 63A(3) After "period", insert "that occur". 34 Paragraph 63B(1)(a) Repeal the paragraph, substitute: (a) those days occur in the application period for an income election that the parent has made; and Note: The heading to section 63B is altered by inserting "income" before "election". 35 Subsection 63B(2) Omit "the days", substitute "those days". 36 Subsection 63B(2) After "period", insert "that occur". 37 Subsection 63B(3) Omit "the days", substitute "those days". 38 Subsection 63B(3) After "period", insert "that occur". 39 Paragraph 63B(3)(a) Before "election", insert "income". 40 Subparagraph 63B(3)(b)(i) Before "election", insert "income". 41 Paragraph 63C(1)(a) Repeal the paragraph, substitute: (a) those days occur in the application period for an income election that the parent has made; and 42 Paragraph 63C(1)(b) Before "period", insert "application". 43 Paragraph 63C(1)(c) Omit "the days in the period", substitute "those days". 44 Subsection 63C(2) Omit "the days in the child support period", substitute "those days". 45 Sections 64 and 64A Repeal the sections, substitute: Division 7A—Reconciliation of estimates of adjusted taxable income Subdivision A—Reconciliation using a parent's actual adjusted taxable income 64 Reconciliation using a parent's actual adjusted taxable income—single income election (1) This section applies for the purposes of assessing a parent in relation to the costs of a child of the parent for a day in a child support period if: (a) the day occurs in the application period for an income election relating to a year of income that was made by the parent; and (b) the parent did not make more than one income election relating to the year of income; and (c) the parent's actual adjusted taxable income for the year of income has been ascertained by the Registrar; and (d) if the Registrar has made a determination under subsection 64AB(1) in relation to the parent—the parent's actual adjusted taxable income for the year of income is more than the parent's determined ATI for that year; and (e) if, under section 63A, 63B or 63C, the Registrar has amended an assessment of child support payable by or to the parent—the Registrar determines that this section should apply in relation to the parent. Reconciliation—election for a whole year of income (2) Subject to this section, if: (a) subsection 60(2) applied to the income election; and (b) the parent's actual adjusted taxable income for the year of income is more than the amount that applied under that subsection; the parent's adjusted taxable income for that year is taken to be, and to have always been, the parent's actual adjusted taxable income for that year. Reconciliation—election for a part of a year of income (3) Subject to this section, if: (a) subsection 60(3) applied to the income election; and (b) the difference between: (i) the parent's actual adjusted taxable income for the year of income; and (ii) the parent's applicable year to date income amount for the year of income; is more than the partial year income amount worked out by the parent under subsection 60(4); the parent's adjusted taxable income for a day that occurs in the application period for the income election is taken to be, and to have always been, the amount worked out under subsection (4). (4) For the purposes of subsection (3), the amount is worked out by: (a) dividing the amount worked out under paragraph (3)(b) by the number of days in the remaining period to which the income election related; and (b) multiplying the quotient by 365. Income amount orders (5) This section does not apply if an income amount order applies in relation to the parent and any part of the application period for the income election. 64A Reconciliation using a parent's actual adjusted taxable income—more than one income election (1) This section applies for the purposes of assessing a parent in relation to the costs of a child of the parent for a day in a child support period if: (a) the day occurs in the application period for an income election relating to a year of income that was made by the parent; and (b) the parent made more than one income election relating to the year of income; and (c) the parent's actual adjusted taxable income for the year of income has been ascertained by the Registrar; and (d) if the Registrar has made a determination under subsection 64AB(1) in relation to the parent—the parent's actual adjusted taxable income for the year of income is more than the parent's determined ATI for that year; and (e) if, under section 63A, 63B or 63C, the Registrar has amended an assessment of child support payable by or to the parent—the Registrar determines that this section should apply in relation to the parent. Reconciliation (2) Subject to this section, if the difference (the actual ATI amount) between: (a) the parent's actual adjusted taxable income for the year of income; and (b) the parent's applicable year to date income amount (if any) for the year of income; is more than the parent's estimated ATI amount for the year of income, then the parent's adjusted taxable income for a day that occurs in the application period of each income election made by the parent is taken to be, and to have always been, the amount worked out for that income election using the method in subsection (4). Estimated ATI amount (3) The parent's estimated ATI amount for the year of income is worked out using the following method: Method statement Step 1. For each income election relating to the year of income that had an application period that ended before the last day of the year of income: (a) if subsection 60(2) applied to the income election—divide the amount that applied under that subsection by 365; or (b) otherwise—divide the partial year income amount worked out under subsection 60(4) or 62A(1) by the number of days in the remaining period to which the income election related. Step 2. For each of those income elections, multiply the result of step 1 by the number of days in the application period for the income election. Step 3. Add up each of the amounts worked out under step 2. Step 4. Add the result of step 3 and the partial year income amount worked out under subsection 62A(1) for the last income election relating to the year of income that was made by the parent. Amount for the purposes of subsection (2) (4) For the purposes of subsection (2), the amount for each income election is worked out using the following method: Method statement Step 1. Subtract the parent's estimated ATI amount from the parent's actual ATI amount. Step 2. Divide the result by the total number of days in the application periods for each income election relating to the year of income that was made by the parent. The result is the additional daily rate. Step 3. For each of those income elections, multiply the additional daily rate by the number of days in the application period for the income election. The result is the underestimated amount for the income election. Step 4. For each of those income elections, add the underestimated amount for the income election and: (a) if the income election had an application period that ended before the last day of the year of income—the amount worked out for the income election under step 2 of the method statement in subsection (3); or (b) otherwise—the partial year income amount worked out under subsection 62A(1) for the income election. Step 5. For each of those income elections: (a) divide the result of step 4 by the number of days in the application period for the income election; and (b) multiply the quotient by 365. Income amount orders (5) This section does not apply if an income amount order applies in relation to the parent and any part of an application period for any of the income elections. 64AA Action by Registrar following reconciliation The Registrar is to take such action as is necessary to give effect to section 64 or 64A in relation to a parent (whether by amending any administrative assessment that has been made in relation to the parent or otherwise). Subdivision B—Reconciliation using a parent's determined ATI 64AB Registrar to determine a parent's adjusted taxable income for the purposes of reconciliation (1) If: (a) a parent made an income election relating to a year of income; and (b) at the end of the period ending 12 months after the end of the year of income, the Registrar has not ascertained the parent's actual adjusted taxable income for that year; the Registrar may determine that an amount that the Registrar considers appropriate is the parent's adjusted taxable income for that year for the purposes of this Subdivision. (2) If the Registrar makes a determination under subsection (1) in relation to a parent: (a) the amount determined is the parent's determined ATI for the year of income; and (b) the Registrar must give notice of the determination to the parent. (3) The notice must include, or be accompanied by, a statement to the effect: (a) that the parent may, subject to the Registration and Collection Act, object to the particulars of the assessment to which the determination relates; and (b) that if the parent is aggrieved by the decision on the objection, he or she may, subject to that Act, apply to the SSAT for review of the decision. (4) A contravention of subsection (3) in relation to a determination does not affect the validity of the determination. 64AC Reconciliation using a parent's determined ATI—single income election (1) This section applies for the purposes of assessing a parent in relation to the costs of a child of the parent for a day in the child support period if: (a) the day occurs in the application period for an income election relating to a year of income that was made by the parent; and (b) the parent did not make more than one income election relating to the year of income; and (c) the Registrar makes a determination under subsection 64AB(1) in relation to the parent; and (d) if, under section 63A, 63B or 63C, the Registrar has amended an assessment of child support payable by or to the parent—the Registrar determines that this section should apply in relation to the parent. Reconciliation—election for a whole year of income (2) Subject to this section, if: (a) subsection 60(2) applied to the income election; and (b) the parent's determined ATI for the year of income is more than the amount that applied under that subsection; the parent's adjusted taxable income for that year is taken to be, and to have always been, the parent's determined ATI for that year. Reconciliation—election for a part of a year of income (3) Subject to this section, if: (a) subsection 60(3) applied to the income election; and (b) the difference between: (i) the parent's determined ATI for the year of income; and (ii) the parent's applicable year to date income amount for the year of income; is more than the partial year income amount worked out by the parent under subsection 60(4); the parent's adjusted taxable income for a day that occurs in the application period for the income election is taken to be, and to have always been, the amount worked out under subsection (4). (4) For the purposes of subsection (3), the amount is worked out by: (a) dividing the amount worked out under paragraph (3)(b) by the number of days in the remaining period to which the income election related; and (b) multiplying the quotient by 365. Income amount orders (5) This section does not apply if an income amount order applies in relation to the parent and any part of the application period for the income election. 64AD Reconciliation using a parent's determined ATI—more than one income election (1) This section applies for the purposes of assessing a parent in relation to the costs of a child of the parent for a day in a child support period if: (a) the day occurs in the application period for an income election relating to a year of income that was made by the parent; and (b) the parent made more than one income election relating to the year of income; and (c) the Registrar makes a determination under subsection 64AB(1) in relation to the parent; and (d) if, under section 63A, 63B or 63C, the Registrar has amended an assessment of child support payable by or to the parent—the Registrar determines that this section should apply in relation to the parent. Reconciliation (2) Subject to this section, if the difference (the actual ATI amount) between: (a) the parent's determined ATI for the year of income; and (b) the parent's applicable year to date income amount (if any) for the year of income; is more than the parent's estimated ATI amount for the year of income, then the parent's adjusted taxable income for a day that occurs in the application period of each income election made by the parent is taken to be, and to have always been, the amount worked out for that income election using the method in subsection (4). Estimated ATI amount (3) The parent's estimated ATI amount for the year of income is worked out using the following method: Method statement Step 1. For each income election relating to the year of income that had an application period that ended before the last day of the year of income: (a) if subsection 60(2) applied to the income election—divide the amount that applied under that subsection by 365; or (b) otherwise—divide the partial year income amount worked out under subsection 60(4) or 62A(1) by the number of days in the remaining period to which the income election related. Step 2. For each of those income elections, multiply the result of step 1 by the number of days in the application period for the income election. Step 3. Add up each of the amounts worked out under step 2. Step 4. Add the result of step 3 and the partial year income amount worked out under subsection 62A(1) for the last income election relating to the year of income that was made by the parent. Amount for the purposes of subsection (2) (4) For the purposes of subsection (2), the amount for each income election is worked out using the following method: Method statement Step 1. Subtract the parent's estimated ATI amount from the parent's determined ATI. Step 2. Divide the result by the total number of days in the application periods for each income election relating to the year of income that was made by the parent. The result is the additional daily rate. Step 3. For each of those income elections, multiply the additional daily rate by the number of days in the application period for the income election. The result is the underestimated amount for the income election. Step 4. For each of those income elections, add the underestimated amount for the income election and: (a) if the income election had an application period that ended before the last day of the year of income—the amount worked out for the income election under step 2 of the method statement in subsection (3); or (b) otherwise—the partial year income amount worked out under subsection 62A(1) for the income election. Step 5. For each of those income elections: (a) divide the result of step 4 by the number of days in the application period for the income election; and (b) multiply the quotient by 365. Income amount orders (5) This section does not apply if an income amount order applies in relation to the parent and any part of an application period for any of the income elections. 64AE Action by Registrar following reconciliation The Registrar is to take such action as is necessary to give effect to sections 64AC and 64AD in relation to a parent (whether by amending any administrative assessment that has been made in relation to the parent or otherwise). Subdivision C—Penalty 64AF Penalty if a parent underestimates an income amount (1) A parent is liable to pay the Registrar a penalty if: (a) the parent made an income election relating to a year of income; and (b) the parent's actual adjusted taxable income for the year of income has been ascertained by the Registrar; and (c) the parent has underestimated an income amount in making the income election. (2) If the parent did not make more than one income election relating to the year of income, the parent has underestimated an income amount in making the income election if: (a) in a case where subsection 60(2) applied to the income election—the parent's actual adjusted taxable income for the year of income is at least 110% of the amount that applied under that subsection; or (b) in a case where subsection 60(3) applied to the income election—the amount worked out by subtracting: (i) the parent's applicable year to date income amount for the year of income; from (ii) the parent's actual adjusted taxable income for the year of income; is at least 110% of the partial year income amount worked out by the parent under subsection 60(4). (3) If the parent made more than one income election relating to the year of income, the parent has underestimated an income amount in making the income elections if the amount worked out by subtracting: (a) the parent's applicable year to date income amount (if any) for the year of income; from (b) the parent's actual adjusted taxable income for the year of income; is at least 110% of the parent's estimated ATI amount for the year of income worked out under subsection 64A(3). 64AG Amount of penalty (1) If a parent is liable under subsection 64AF(1) to pay a penalty, the amount of the penalty for each income election made by the parent relating to the year of income is 10% of the difference between: (a) the administrative assessment of child support made under section 64AA in relation to the parent; and (b) the administrative assessment of child support that would have been made if it were based entirely on the amount that applied under subsection 60(2) or (3), or that was worked out under subsection 62A(1). (2) The penalty is a debt due to the Commonwealth by the parent and is due and payable on the issue of the administrative assessment of child support made under section 64AA in relation to the parent. 64AH Remission of penalty (1) The Registrar may remit the whole or a part of a penalty that a parent who made an income election is liable to pay under subsection 64AF(1) if: (a) the parent underestimated an income amount in making the income election because of an amendment of an Income Tax Assessment Act, or because of a ruling or determination under that Act; or (b) the parent underestimated an income amount in making the income election for some other reason, and the Registrar is satisfied that it would be fair and reasonable in the circumstances to remit the whole or that part of the penalty. (2) If the Registrar makes a decision to remit only part of the penalty, or not to remit any part of the penalty, the Registrar must give written notice of the decision to the parent by whom the penalty is, or but for the remission would be, payable. (3) The notice must include, or be accompanied by, a statement to the effect: (a) that the parent may, subject to the Registration and Collection Act, object to the decision (the original decision); and (b) that if the parent is aggrieved by a later decision on an objection to the original decision, he or she may, subject to that Act, apply to the SSAT for review of the later decision. (4) A contravention of subsection (3) in relation to a decision does not affect the validity of the decision. 46 Subparagraphs 65A(1)(b)(i) and (ii) Repeal the subparagraphs, substitute: (i) if subparagraph (ii) does not apply—the parent's adjusted taxable income determined in accordance with section 43 for the last relevant year of income for the child support period; (ii) if the day occurs in the application period for an income election made by the parent—the amount that applied under subsection 60(2) or (3), or that was worked out under subsection 62A(1); and 47 Paragraph 146BA(1)(d) Repeal the paragraph, substitute: (d) subparagraph 65A(1)(b)(ii) were omitted and substituted with the following: "(ii) if the parent made an election under subsection 146G(1) relating to the child—the amount estimated by the parent under that subsection.". Child Support (Registration and Collection) Act 1988 48 Subsection 80(1) (after table item 11) Insert: 11A to refuse under subsection 63AD(1) of the Assessment Act to accept an election made by a parent under subsection 63AC(1) of that Act the parent 11B to make a determination in relation to a parent under subsection 63AE(1) of the Assessment Act the parent 49 Subsection 80(1) (table item 12, column headed "Decision") Omit "section 64A", substitute "section 64AH". 50 Subsection 110U(1) Omit "section 64A", substitute "section 64AH". Note: The heading to section 110U is altered by omitting "section 64A" and substituting "section 64AH". Part 2—Transitional provisions 51 Transitional provision (1) This item applies to an election made by a parent if: (a) the election was made under section 60 of the Child Support (Assessment) Act 1989 (the CSA Act) before the commencement of this item; and (b) the first day in a child support period to which the election applies occurs during the period starting on 1 April 2008 and ending on 30 June 2010; and (c) the election has not been revoked before that commencement. (2) Despite the repeal of section 60 of the CSA Act by this Schedule, the election continues to have effect after that commencement as if that section had not been repealed. (3) Despite the amendments made by this Schedule to the CSA Act, that Act, as in force immediately before that commencement, continues to apply in relation to the election as if those amendments had not been made. (4) Despite subitem (3), section 64 of the CSA Act, as in force immediately before that commencement, does not apply in relation to the election unless the Registrar determines, on his or her own initiative or under subitem (6), that it should so apply. (5) The parent, or the other parent to whom child support is payable, may request the Registrar to determine that section 64 of the CSA Act, as in force immediately before that commencement, applies in relation to the election. (6) If a request is made under subitem (5), the Registrar may determine that section 64 of the CSA Act, as in force immediately before that commencement, applies in relation to the election. 52 Application in relation to Western Australian exnuptial children (1) This item applies if, immediately after the commencement of this item, the Child Support (Assessment) Act 1989 and the Child Support (Registration and Collection) Act 1988, as amended by this Act, do not extend to Western Australia in relation to the maintenance of exnuptial children because: (a) the Parliament of Western Australia has not referred to the Parliament of the Commonwealth the matter of the maintenance of exnuptial children or matters that include that matter; and (b) Western Australia has not adopted those Acts as amended by this Act. (2) Item 51 of this Schedule applies in Western Australia, after Western Australia adopts those Acts as amended by this Act, in relation to the maintenance of exnuptial children: (a) as if references in that item to the commencement of that item were references to the adoption of those Acts by Western Australia as amended by this Act; and (b) as if the reference in paragraph (1)(b) of that item to 30 June 2010 were a reference to the day before the adoption of those Acts by Western Australia as amended by this Act. Schedule 2—Percentage of care Part 1—Amendments A New Tax System (Family Assistance) Act 1999 1 Subsection 3(1) Insert: application day has the meaning given by subsections 35K(2) and (3). 2 Subsection 3(1) Insert: care arrangement in relation to a child means: (a) a written agreement between the parents of the child, or between a parent of the child and another person who cares for the child, that relates to the care of the child; or (b) a parenting plan for the child; or (c) any of the following orders relating to the child: (i) a family violence order within the meaning of section 4 of the Family Law Act 1975; (ii) a parenting order within the meaning of section 64B of that Act; (iii) a State child order registered in accordance with section 70D of that Act; (iv) an overseas child order registered in accordance with section 70G of that Act. 3 Subsection 3(1) Insert: care period has the meaning given by subparagraph 35A(1)(a)(ii) or (2)(b)(ii) or paragraph 35B(1)(a) or (2)(b). 4 Subsection 3(1) Insert: change of care day for an individual who cares for a child means: (a) if a determination of the individual's percentage of care for the child has been revoked under Subdivision E of Division 1 of Part 3—the first day on which the care of the child that was actually taking place ceased to correspond with the individual's percentage of care for the child under the determination; or (b) otherwise—the first day on which the care of the child that was actually taking place ceased to correspond with the individual's extent of care under a care arrangement that applies in relation to the child. 5 Subsection 3(1) Insert: child support care determination has the meaning given by paragraph 35T(1)(b). 6 Subsection 3(1) (subparagraph (b)(i) of the definition of FTB child) Omit "in applying paragraph 22(6A)(b) to child care benefit, the reference in that paragraph", substitute "in applying Subdivision D of that Division to child care benefit, a reference in that Subdivision". 7 Subsection 3(1) Insert: interim period has the meaning given by subsection 35L(2). 8 Subsection 3(1) Insert: percentage of care, in relation to an individual who cares for a child, means the individual's percentage of care for the child that is determined by the Secretary under Subdivision D of Division 1 of Part 3. 9 Subsection 3(1) Insert: percentage range has the meaning given by subsection 35P(2). 10 Subsection 3(1) Insert: reduced care of a child has the meaning given by section 35H. 11 Subsection 3(1) (paragraph (a) of the definition of regular care child) Repeal the paragraph, substitute: (a) means an individual: (i) who would be an FTB child of the adult but for the operation of section 25 (adult's percentage of care for the child during a care period is less than 35%); and (ii) for whom the adult has a percentage of care during a care period that is at least 14%; and 12 Subsections 22(6A) to (6D) Repeal the subsections. 13 Subsection 22(7) Omit "If, under subsection (6A), the Secretary determines that a child was, or will be, in the care of an individual for at least 35% of a period", substitute "If an individual's percentage of care for a child during a care period is at least 35%". 14 Subsection 22(7) (note) Omit "If the Secretary determines that a child was, or will be, in the care of an individual for less than 35% of a period", substitute "If an individual's percentage of care for a child during a care period is less than 35%". 15 Section 25 Omit all the words before "the child is taken", substitute "If an individual's percentage of care for a child during a care period is less than 35%,". Note: The heading to section 25 is replaced by the heading "Effect of an individual's percentage of care for a child being less than 35%". 16 Section 25A Omit all the words before "the child is taken", substitute "If an individual's percentage of care for a child during a care period is at least 14% but less than 35%,". Note: The heading to section 25A is altered by omitting "period of care" and substituting "care period". 17 Paragraph 27(2)(b) Repeal the paragraph, substitute: (b) if the Secretary has determined, under section 35A or 35B, one individual's percentage of care for the qualifying child during a care period (whether before or after the 2 individuals became members of that couple)—the Secretary is taken to have determined the same percentage to be the other individual's percentage of care for the child during that period. 18 At the end of Division 1 of Part 3 Add: Subdivision D—Determination of percentage of care 35A Determination of percentage of care—child is not in the adult's care Initial determination (1) If: (a) the Secretary is satisfied that an individual (the adult) has no care of a child but that: (i) the child is an FTB child of the adult under section 23; or (ii) the child would, under subsection 22(2), (3), (4) or (6), be an FTB child of the adult if there had been, or were to be, a pattern of care for the child over a period (the care period) under a care arrangement relating to the child; and (b) the adult, or the partner of the adult, makes or has made a claim under Part 3 of the A New Tax System (Family Assistance) (Administration) Act 1999 for payment of family tax benefit in respect of the child for some or all of the days in the care period; and (c) the adult is not a partner of at least one other individual who has a pattern of care for the child such that the child was or will be, under subsection 22(2), (3), (4) or (6), an FTB child of the other individual or individuals; and (d) section 35C, 35D or 35G applies in relation to the adult; the Secretary must determine the adult's percentage of care for the child during the care period in accordance with that section. Determination after revocation (2) If: (a) the Secretary revokes, under Subdivision E of this Division, a determination of an individual's (the adult) percentage of care for a child that was made under this section or section 35B; and (b) the Secretary is satisfied that the adult has no care of the child but that: (i) the child is an FTB child of the adult under section 23; or (ii) the child would, under subsection 22(2), (3), (4) or (6), be an FTB child of the adult if there had been, or were to be, a pattern of care for the child over a period (the care period) under a care arrangement relating to the child; and (c) the adult is not a partner of at least one other individual who has a pattern of care for the child such that the child was or will be, under subsection 22(2), (3), (4) or (6), an FTB child of the other individual or individuals; and (d) section 35C, 35D or 35G applies in relation to the adult; the Secretary must determine the adult's percentage of care for the child during the care period in accordance with that section. 35B Determination of percentage of care—child is in the adult's care Initial determination (1) If: (a) the Secretary is satisfied that there has been, or will be, a pattern of care for a child over a period (the care period) such that, for the whole, or for parts (including different parts), of the care period, the child was or will be, under subsection 22(2), (3), (4) or (6), an FTB child of more than one individual; and (b) one of those individuals (the adult), or the partner of the adult, makes or has made a claim under Part 3 of the A New Tax System (Family Assistance) (Administration) Act 1999 for payment of family tax benefit in respect of the child for some or all of the days in the care period; and (c) the adult is not a partner of at least one of the other individuals referred to in paragraph (a); the Secretary must determine the adult's percentage of care for the child during the care period. Determination after revocation (2) If: (a) the Secretary revokes, under Subdivision E of this Division, a determination of an individual's (the adult) percentage of care for a child that was made under section 35A or this section; and (b) the Secretary is satisfied that there has been, or will be, a pattern of care for the child over a period (the care period) such that, for the whole, or for parts (including different parts), of the care period, the child was or will be, under subsection 22(2), (3), (4) or (6), an FTB child of the adult and at least one other individual; and (c) the adult is not a partner of at least one of those other individuals; the Secretary must determine the adult's percentage of care for the child during the care period. Percentage of care (3) The percentage determined under subsection (1) or (2) must be a percentage that corresponds with the actual care of the child that the Secretary is satisfied that the adult has had, or will have, during the care period. (4) Despite subsection (3), if section 35C, 35D or 35G applies in relation to the adult, the Secretary must determine the adult's percentage of care under subsection (1) or (2) in accordance with that section. 35C Percentage of care if action taken to ensure that a care arrangement in relation to a child is complied with (1) This section applies in relation to an individual (the adult) if: (a) a care arrangement applies in relation to a child; and (b) the Secretary is satisfied that the actual care of the child that the adult has had, or will have, during a care period does not comply with the extent of care of the child that the adult should have had, or is to have, under the care arrangement during the care period (which may be nil); and (c) an individual who has reduced care of the child has taken reasonable action to ensure that the care arrangement is complied with. Note: This section does not apply in certain circumstances, see section 35F. (2) The Secretary must determine, under section 35A or 35B, 2 percentages of care in relation to the adult. (3) The first percentage of care is to be a percentage that corresponds with the extent of care of the child that the adult should have had, or is to have, under the care arrangement during the care period (which may be nil). (4) The second percentage of care is to be: (a) if section 35A applies in relation to the adult—0%; or (b) if section 35B applies in relation to the adult—a percentage that corresponds with the actual care of the child that the Secretary is satisfied that the adult would have during the care period if the action referred to in paragraph (1)(c) were not to succeed. 35D Percentage of care if action taken to make a new care arrangement in relation to a child (1) This section applies in relation to an individual (the adult) if: (a) a care arrangement (the current care arrangement) applies in relation to a child; and (b) the Secretary is satisfied that the actual care of the child that the adult has had, or will have, during the care period does not comply with the extent of care of the child that the adult should have had, or is to have, under the care arrangement during the care period (which may be nil); and (c) an individual who has reduced care of the child: (i) has not taken reasonable action to ensure that the current care arrangement is complied with; but (ii) has taken reasonable action to make another care arrangement (the new care arrangement) in relation to the child; and (d) the Secretary is satisfied that, if the new care arrangement were to be made, the extent of care that the individual who has reduced care of the child would have under that arrangement during the care period would be: (i) more than the actual care of the child that the Secretary is satisfied that the individual has had, or will have, during that period; but (ii) less than the extent of care of the child that the individual should have had, or is to have, under the current care arrangement during that period; and (e) the Secretary is satisfied that special circumstances exist in relation to the individual who has reduced care of the child. Note: This section does not apply in certain circumstances, see section 35F. (2) The Secretary must determine, under section 35A or 35B, 2 percentages of care in relation to the adult. (3) The first percentage of care is to be a percentage that corresponds with the extent of care of the child that the adult would have under the new care arrangement during the care period if it were to be made. (4) The second percentage of care is to be: (a) if section 35A applies in relation to the adult—0%; or (b) if section 35B applies in relation to the adult—a percentage that corresponds with the actual care of the child that the Secretary is satisfied that the adult would have during the care period if the new care arrangement were not to be made. 35E Application of sections 35C and 35D in relation to claims for family tax benefit for a past period Initial determination (1) If: (a) the Secretary is required by section 35A or 35B to determine an individual's percentage of care for a child; and (b) subsection 35A(1) or 35B(1) applies; and (c) the claim referred to in paragraph 35A(1)(b) or 35B(1)(b) is a claim for payment of family tax benefit for a past period; sections 35C and 35D apply in relation to the individual as if the determination were being made on the first relevant day of the past period. Determination after revocation (2) If: (a) the Secretary is required by section 35A or 35B to determine (the new determination) an individual's percentage of care for a child; and (b) subsection 35A(2) or 35B(2) applies; and (c) the determination (the earlier determination) referred to in paragraph 35A(2)(a) or 35B(2)(a) relates to a claim for payment of family tax benefit for a past period; sections 35C and 35D apply in relation to the individual as if the new determination were being made on the relevant day after the revocation of the earlier determination. 35F Sections 35C and 35D do not apply in certain circumstances (1) Sections 35C and 35D do not apply in relation to an individual if: (a) subsection 35A(1) or 35B(1) applies; and (b) either: (i) if the claim referred to in paragraph 35A(1)(b) or 35B(1)(b) is a claim for payment of family tax benefit for a past period—the first day of the past period is 14 weeks or more after the change of care day for the individual; or (ii) otherwise—the day on which the claim referred to in that paragraph is or was made is 14 weeks or more after the change of care day for the individual. (2) If the Secretary is satisfied that special circumstances exist in relation to an individual who has reduced care of the child, the Secretary may determine that subsection (1) applies as if the reference to 14 weeks in subparagraph (1)(b)(i) or (ii) were a reference to such longer period as the Secretary determines to be appropriate. (3) The period determined under subsection (2) must not be more than 26 weeks. 35G Percentage of care if claim is made for payment of family tax benefit because of the death of a child (1) This section applies in relation to an individual (the adult) if: (a) the adult, or the partner of the adult, has ma