Supplementary Explanatory Memorandum
(Circulated by the authority of the Minister for Social Services, the Hon Christian Porter MP)Schedule 16 - Streamlining Tax File Number Collections
Summary
The amendments to Schedule 16 will allow the request for tax file number provisions in the social security law to apply to a relevant third-party as part of a person's claim for a social security payment, and to an income-tested health care card. The amendments will also allow the use of tax file numbers to verify qualification for the seniors health card and an income-tested health care card.
Background
Schedule 16 of the Bill amends the social security law to allow a request to provide a tax file number and/or a relevant third party's tax file number as part of a claim for a social security payment or seniors health card, and to prevent payment or provision of the card until the request is satisfied.
The amendments to Schedule 16 allow the application of the tax file number request provisions for a relevant third party to include a person who is making, or has made, a claim for a social security payment where the third party's income is relevant to the person's rate of payment. As currently drafted, Schedule 16 would unintentionally prevent the ability to request a third party's tax file number as part of a claim, as new paragraph 75(4)(a) of the Social Security Administration Act would only refer to a person who is 'receiving' a social security payment.
The amendments to Schedule 16 will also allow the tax file number provisions to apply to an income-tested health care card, consistent with the provisions for social security payments and the seniors health card.
The amendments to Schedule 16 will also allow the use of tax file numbers to verify qualification for the seniors health card and an income-tested health care card, consistent with the existing ability to use tax file numbers to verify qualification for a social security payment.
Explanation of the changes
Amendments (8) and (9 ) insert reference to a health care card that is income-tested for the request recipient into section 75 to be substituted by item 1 of Schedule 16 to the Bill. This will allow the Secretary (or delegate) to request a claimant for, or holder of, such a card to provide a tax file number.
Amendment (10 ) replaces proposed paragraph 75(4)(a) which sets out the circumstances in which a claimant may be requested to provide a tax file number of one or more other persons whose income is required to be taken into account in working out the rate of the payment. The substituted paragraph expands the time at which the request to provide a tax file number may be made to include a request of the claimant making their claim. Amendment (11 ) is consequential to amendment (7), making it clear that the social security payment about which the request under paragraph 75(4)(a) may be made is the same payment being claimed by the claimant, but may ultimately not be a payment paid to such claimant. For example, a youth allowance payment for a not independent young person may be paid to their parent on their behalf.
Amendments (12) and (13 ) amend section 76 which is to be substituted by item 1 of Schedule 16, dealing with how a request for a tax file number is satisfied. Amendment (12 ) removes the current reference in subsection 76(2) to a seniors health card and substitutes reference to a claim described in paragraph 75(1)(a) or (c). This allows the period described by this subsection for satisfaction of the tax file number request to apply also to a claim for an income tested health care card. Amendment (13 ) makes clear the reference in that subsection to paragraph 1(a) or (b) is to those paragraphs of section 76.
Amendments (14) and (15 ) modify section 77 substituted by item 1 of Schedule 16 to make clear the consequences of not satisfying the request for a tax file number. These amendments insert reference to a health care card that is income-tested for the person into table items 2 and 4, so that the consequences of not satisfying the request for the claimant of this card are the same as those for a claimant of a seniors health card.
Amendment (16 ) similarly inserts reference to a health care card that is income-tested for the person after the reference to a seniors health card in subsection 77(3), dealing with responses to the request for a tax file number involving the Secretary contacting the Commissioner of Taxation. This provides the same consequences for the holder of an income tested health care card as those for the holder of a seniors health card.
Amendment (17 ) expands section 204A, which provides the uses to which the Secretary may put information provided to the Secretary by the Commissioner of Taxation, including tax file numbers. New paragraph 204A(2)(ba) allows the use of this information to verify, in respect of persons who have made claims under the social security law for seniors health cards, or health care cards that are income-tested for those persons, the qualification of those persons for those cards.
Amendment (18 ) makes consequential amendments to insert a definition of income - tested into the Social Security Act, to support the use of this term in the tax file number provisions. The definition inserted into subsection 6A(1) by new item 1B provides that a health care card is income-tested for a person if the person is required by paragraph 1061ZO(2)(d), (3)(e) or (4)(d) to satisfy the health care card income test in order to qualify for the health care card.
Amendment (19 ) inserts new item 1C , consequential to item 1B. Item 1C inserts a cross-reference to the new definition in section 6A into subsection 23(1), which sets out general definitions.
Amendments (20) and (21 ) insert new items 3 and 4 to consequentially amend existing notes at subsection 37(8) and subsection 86(1) of the Social Security (Administration) Act. The amendments insert reference to the effect of section 75 and section 77 on claims for, or holders of, an income-tested health card card, as a result of the above amendments.
Amendment (22 ) similarly consequentially amends the definition of 'adverse determination' at section 121 ( item 5 ) to insert reference to the effect of section 77 for a holder of a health care card that is income-tested for a person.