Second Reading Speech
Anthony, Larry, MP (Richmond, Minister for Children and Youth Affairs, NP, Government)I move:
That this bill be now read a second time.
The purpose of this bill is to extend the amount of time families have to receive a top-up to their family tax benefit (FTB) payment by 12 months. The bill also gives families a further 12 months to claim their FTB and child-care benefit (CCB) as lump sum payments.
By providing families with more time to receive FTB top-up payments and to lodge FTB and CCB lump sum claims, the amend-ments recognise that some families and tax agents require extra time to finalise their taxation details. The extension will apply to those customers seeking top-ups or lump sum payments for the 2001-02 financial year and subsequent years.
Currently, families have 12 months from the end of an income year to receive a top-up to their FTB payments and to lodge their FTB and CCB lump sum claims. Amendments are made to provide families with an additional 12 months to receive a top-up to their FTB payment and to lodge FTB and CCB lump sum claims.
FTB top-up payments are mostly made to families who receive their FTB payments on a fortnightly basis and who have overestimated their income for the year. Under existing arrangements, families must lodge their income tax returns within 12 months following the end of the income year to be eligible for a top-up payment. This means that for the 2001-02 income year, families had until 30 June 2003 to lodge their income tax returns and receive any FTB top-up payment. This bill will extend that time to 30 June 2004. This bill does not change the legal requirement for families to lodge tax returns within 12 months. It simply means that, even if they do not lodge within that 12 months, they will be eligible for a top-up if they lodge in the subsequent 12 months
This bill extends the time period in which top-ups can be paid for the 2001-02 tax year and subsequent years. It provides families with an additional 12 months to receive FTB top-up payments. Provided families lodge their 2001-02 tax return by 30 June 2004 they will receive any FTB top-up payment to which they would be entitled. However, the penalties that apply for late lodgment under taxation laws will continue to apply.
This bill also introduces an extension to the time period in which lump sum claims can be made. The existing law allows families until 30 June 2003 to claim FTB and CCB lump sum payments relating to the 2001-02 tax year. This bill gives families an additional 12 months to 30 June 2004 to make claims for lump sum payments. The 12-month extension for FTB and CCB lump sum claims will also apply to subsequent tax years, but the penalties that apply for late lodgment under taxation laws will continue to apply
To enable these payments to be made to families, existing time frames relating to the exchange of tax file number data for the purposes of income reconciliation and to the destruction of that data are extended from two to three years after the relevant income year.
The deadline for lodging tax returns for tax purposes is not affected by this bill. Individuals would continue to be subject to penalties applied by the ATO for lodging after 1 October of the year following the end of the year to which the tax return relates.
The amendments contained in this bill give families more time to ensure that they receive their full FTB and CCB entitlements.
I present the explanatory memorandum to the bill.
Debate (on motion by Mr Rudd) adjourned.