As the new financial year commences on 1 July 2025, families throughout Australia will be prompted to review their financial support arrangements through Services Australia. This process, known as ‘balancing’, will ensure that families have received their correct entitlements over the past year for various payments, particularly the Family Tax Benefit (FTB) and the Child Care Subsidy (CCS).
### Understanding the Balancing Process
Balancing occurs post the end of the financial year on 30 June, requiring families to cross-reference their estimated income against their actual income. For many, this review can result in a payment top-up; however, some may face no alterations to their payments or even the necessity to repay debts.
It’s essential to note that FTB and CCS are evaluated and balanced separately, each following distinct procedures. Before any payments can be balanced, families must confirm their income. This can be accomplished by lodging a tax return with the Australian Taxation Office (ATO) or confirming that there is no requirement to lodge.
### What Families Need to Do
For those with a partner, it’s critical that both partners either file their returns or confirm the lack of a requirement to do so. If neither partner needs to lodge, income confirmation can be done through the Express Plus Centrelink app or their myGov account.
Also, families receiving both FTB and CCS will need to ensure they confirm their income for CCS even if FTB balancing doesn’t require additional action.
### Timeline for Balancing
The balancing for FTB starts in July, while CCS balancing initiates from mid-August. The delays in CCS are due to the need for information from childcare providers prior to processing.
Once a tax return is lodged, the ATO will relay confirmed income figures for the financial year to Services Australia. This process can take up to 28 days. Families are encouraged to refrain from calling for updates, as they can track their balancing progress through the app or their online account via myGov.
In instances where a family has separated during the year, FTB can be balanced once income is confirmed, using estimated income for the ex-partner if they haven’t lodged their return yet. However, it remains necessary to verify the ex-partner’s income for CCS.
### Notification and Repayment Procedures
After the balancing process is concluded, families can expect to receive a letter detailing their results either through myGov or by mail. This correspondence will outline any necessary actions if repayments are required.
Should any debts arise during balancing, Services Australia can recover these amounts from any FTB top-ups and supplements owed to the families, even amidst pre-existing repayment agreements. Families facing financial difficulties are encouraged to reach out for support in organising manageable repayment plans.
### Preparing for Next Year
Throughout the financial year, families can take proactive steps to ensure appropriate payments and reduce potential debts by keeping their financial information updated. Regularly updating one’s family income estimate and other details in their online account can greatly help in maintaining correct entitlements.
Further, families can choose how they wish to receive their FTB payments, with options to receive full, partial, or none of their payments on a fortnightly basis, with any additional balances being paid as part of the annual reconciliation.
Interestingly, Services Australia withholds 5% of Child Care Subsidy payments as a means to minimise the chance of overpayments at year-end. Families can adjust this withholding percentage via their online accounts to increase their chances of receiving a top-up in future balances.
In conclusion, families should be diligent in managing their tax and income reporting throughout the year. By doing so, they can ensure that they receive the correct support and potentially mitigate any unwanted debt scenarios when the financial year wraps up. For ongoing updates and information, families may follow Yahoo Finance on various social media platforms for the latest news.
