Social Services and Other Legislation Amendment (Simplifying Income Reporting and Other Measures) Act 2020 (17 of 2020)
Schedule 1 Amendments
Part 1 Simplifying income reporting
Social Security Act 1991
37 Sections 1073A and 1073B
Repeal the sections, substitute:
1073A Attribution of employment income paid in respect of a particular period or periods
(1) This section applies if:
(a) a person is receiving a social security pension or a social security benefit; and
(b) the person's rate of payment of the pension or benefit is worked out with regard to the income test module of a rate calculator in this Chapter; and
(c) one or more amounts of employment income, each of which is in respect of a particular period or periods (each period is an employment period ), are paid in an instalment period of the person to or for the benefit of the person by the same employer.
Note 1: If the person has multiple employers, this section applies separately in relation to each employer.
Note 2: If a person is receiving a social security pension and is paid employment income monthly, section 1073B may apply to that income instead of this section.
Note 3: Section 1073BA deals with the payment of employment income that is not in respect of a particular period.
(2) The person is taken to have received the employment income over a period (the assessment period ) that consists of the number of days that is equal to the sum of the number of days in each employment period, where the assessment period begins on the first day of the instalment period in which the amounts of employment income are paid.
Example: On 3 June a person is paid $756 employment income for work the person performed in the period beginning on 9 May and ending at the end of 29 May. The number of days in the employment period is 21.
Assume the instalment period begins on 1 June. The person is taken to have received the $756 over the period beginning on 1 June and ending at the end of 21 June (a period of 21 days).
(3) Subject to subsection (4), for each day in the assessment period, the person is taken to have received an amount of employment income worked out by dividing the total amount of the employment income covered by paragraph (1)(c) by the number of days in the assessment period.
Example: To continue the example in subsection (2), the person is taken to have received $36 ($756/21) on each of the days in the period beginning on 1 June and ending at the end of 21 June.
(4) If the person is taken, under subsection (3), to have received employment income (the attributed employment income ) during a part, but not the whole, of a particular instalment period, the person is taken to receive on each day in that instalment period an amount of employment income worked out by dividing the total amount of the attributed employment income by the number of days in the instalment period.
Example: To continue the example in subsection (2), for the instalment period beginning on 15 June and ending at the end of 28 June the person is taken, under subsection (3), to have received employment income during a part of that instalment period (15 June to 21 June). The person is taken to have received $252 ($36 x 7).
Under subsection (4), the person is taken to receive on each day in that instalment period an amount of employment income of $18 ($252/14).
Interpretation
(5) This section applies in relation to an amount of employment income paid on a day in an instalment period, whether or not the amount is received on that day.
(6) In applying subsection (2) in relation to one or more amounts of employment income paid by a particular employer in an instalment period, in working out the sum of the number of days in each employment period, if a day in an employment period overlaps with a day in another employment period, that day must only be counted once.
1073B Attribution of employment income paid monthly
(1) This section applies if:
(a) a person is receiving a social security pension; and
(b) the person's rate of payment of the pension is worked out with regard to the income test module of a rate calculator in this Chapter; and
(c) an amount (the initial amount ) of employment income, in respect of a period of 1 month, is paid on a day in a calendar month (the initial calendar month ) to or for the benefit of the person by the person's employer; and
(d) the Secretary is satisfied that, for the reasonably foreseeable future, an amount of employment income, in respect of a period of 1 month, equal to the initial amount will be paid to or for the benefit of the person by that employer on the following:
(i) the corresponding day in each calendar month (a later calendar month ) after the initial calendar month;
(ii) if there is no such day in a later calendar month month - the last day of the later calendar month.
Note: If the person has multiple employers, this section applies separately in relation to each employer.
(2) Subject to this section, for the day on which the initial amount is paid and for each day after that day, the person is taken to have received an amount of employment income worked out as follows:
(3) If, after the day on which the initial amount is paid, the Secretary ceases to be satisfied as mentioned in paragraph (1)(d) in relation to the person and the person's employer, then subsection (2) ceases to apply in relation to the person and the person's employer at the end of the period of 1 month beginning on the last payment day.
(4) For the purposes of this section, a payment day is:
(a) the day in the calendar month on which the initial amount is paid by the person's employer; or
(b) the following on which an amount of employment income equal to the initial amount is paid to or for the benefit of the person by that employer:
(i) a corresponding day in a later calendar month;
(ii) if there is no such day in a later calendar month - the last day of the later calendar month.
(5) If the person is taken, under this section, to have received employment income (the attributed employment income ) during a part, but not the whole, of a particular instalment period, the person is taken to receive on each day in that instalment period an amount of employment income worked out by dividing the total amount of the attributed employment income by the number of days in the instalment period.
(6) Section 1073A does not apply to an amount of employment income covered by paragraph (4)(a) or (b).
Interpretation
(7) This section applies in relation to an amount of employment income paid on a day in a calendar month, whether or not the amount is received on that day.
(8) Subsection (3) does not prevent a later application of this section in relation to the person, whether in connection with the same employer or another employer.
1073BA Attribution of employment income paid not in respect of a particular period
(1) This section applies if:
(a) a person is receiving a social security pension or a social security benefit; and
(b) the person's rate of payment of the pension or benefit is worked out with regard to the income test module of a rate calculator in this Chapter; and
(c) an amount of employment income is paid on a day to or for the benefit of the person; and
(d) the employment income is not in respect of a particular period.
(2) The person is taken to have received that employment income over such period, not exceeding 52 weeks, as the Secretary determines.
Note 1: When determining the period, the Secretary may take into consideration the following:
(a) the nature of the person's remunerative work;
(b) the nature of the person's employment income;
(c) the person's financial interests;
(d) any financial hardship which may be caused to the person;
(e) whether the employment income relates to remunerative work that was undertaken at a time when the person was not receiving a social security pension or a social security benefit.
Note 2: The period determined by the Secretary should be fair and reasonably beneficial, taking into account the financial interests of the person receiving the social security pension or social security benefit.
(3) The period determined by the Secretary must begin on the first day of the instalment period in which the amount of employment income is paid.
(4) Subject to subsection (5), for each day in the period determined by the Secretary, the person is taken to have received an amount of employment income worked out by dividing the amount of employment income covered by paragraph (1)(c) by the number of days in that period.
(5) If the person is taken, under subsection (4), to have received employment income (the attributed employment income ) during a part, but not the whole, of a particular instalment period, the person is taken to receive on each day in that instalment period an amount of employment income worked out by dividing the total amount of the attributed employment income by the number of days in the instalment period.
Interpretation
(6) This section applies in relation to an amount of employment income paid on a day, whether or not the amount is received on that day.
1073BB Anti-avoidance
(1) This section applies if:
(a) a person (the relevant person ) is receiving a social security pension or a social security benefit; and
(b) the relevant person earns or derives employment income during the whole or a part of an instalment period of the person; and
(c) one or more entities (who may be, or may include, the relevant person) enter into, commence to carry out, or carry out, a scheme to defer the payment of that employment income; and
(d) it would be concluded that the entity, or any of the entities, who entered into, commenced to carry out, or carried out, the scheme did so for the sole or dominant purpose of obtaining a social security advantage for a person (who may be the relevant person or may be the entity or one of the entities).
(2) The Secretary may determine that the relevant person is taken to have received an amount of employment income, equal to the amount of employment income referred to in paragraph (1)(b), over the period determined by the Secretary.
(3) The period determined by the Secretary must begin on the first day of the instalment period referred to in paragraph (1)(b).
(4) Subject to subsection (5), for each day in the period determined by the Secretary, the relevant person is taken to have received an amount of employment income worked out by dividing the total amount of the employment income referred to in paragraph (1)(b) by the number of days in that period.
(5) If the relevant person is taken, under subsection (4), to have received employment income (the attributed employment income ) during a part, but not the whole, of a particular instalment period, the relevant person is taken to receive on each day in that instalment period an amount of employment income worked out by dividing the total amount of the attributed employment income by the number of days in the instalment period.
(6) Sections 1073A, 1073B and 1073BA do not apply in relation to the payment of the employment income referred to in paragraph (1)(b).
(7) A determination under subsection (2) has effect accordingly.
Obtaining a social security advantage
(8) For the purposes of this section, an entity has a purpose of obtaining a social security advantage for a person (who may be the entity) if the entity has a purpose of:
(a) enabling the person to obtain any of the following:
(i) a social security pension;
(ii) a social security benefit;
(iii) a service pension;
(iv) income support supplement;
(v) a veteran payment;
(vi) a payment under the ABSTUDY Scheme; or
(b) enabling the person to obtain any of the following at a higher rate than would otherwise have been payable:
(i) a social security pension;
(ii) a social security benefit;
(iii) a service pension;
(iv) income support supplement;
(v) a veteran payment;
(vi) a payment under the ABSTUDY Scheme.
Definitions
(9) In this section:
entity means any of the following:
(a) an individual;
(b) a company within the meaning of the Income Tax Assessment Act 1997;
(c) a trust;
(d) a partnership within the meaning of the Income Tax Assessment Act 1997;
(e) any other unincorporated association or body of persons;
(f) a corporation sole;
(g) a body politic.
scheme means:
(a) any agreement, arrangement, understanding, promise or undertaking, whether express or implied and whether or not enforceable, or intended to be enforceable, by legal proceedings; or
(b) any scheme, plan, proposal, action, course of action or course of conduct, whether there are 2 or more parties or only one party involved.
1073BC Exclusion of certain payments
Sections 1073A, 1073B, 1073BA and 1073BB do not apply in relation to the following:
(a) a payment in respect of which a person is taken to have received ordinary income for a period under point 1064-F4, 1066A-G4, 1067G-H11, 1067L-D5, 1068-G7AG, 1068A-E3 or 1068B-D9;
(b) a payment in respect of which a person is taken to receive an amount under point 1064-F10, 1066A-G10, 1067G-H15, 1067L-D11 or 1068-G7AL;
(c) an amount that a person's ordinary income is taken to include under point 1067G-H5 or 1068-G7AA.
1073BD Daily attribution of employment income for amounts not elsewhere covered in this Division
If:
(a) a person is receiving a social security pension or a social security benefit; and
(b) the person's rate of payment of the pension or benefit is worked out with regard to the income test module of a rate calculator in this Chapter; and
(c) the person is taken, under a provision of this Act (except section 1073A, 1073B, 1073BA or 1073BB), to receive employment income during the whole or a part of a particular instalment period of the person;
the person is taken to receive, on each day in that instalment period, an amount of employment income worked out by dividing the total amount of the employment income referred to in paragraph (c) by the number of days in the instalment period.