Nick Bruining: Students and carers to see increased support payments in January

While March, July and September are typically the “big” months for Centrelink changes, January also sees a number of increases to things that will directly affect our monthly expenses and for some, an increase in income support payments.

The increases are restricted mainly to students, those on Youth Allowance and those receiving a disability support pension who are aged under 21 with no dependants.

Also of note is an increase to the fortnightly Carer Allowance payment.

This is arguably Australia’s least understood payment and is potentially available to thousands of people who routinely look after a loved one or friend.

This is not the same as the carer’s payment which is payable to a full-time carer looking after someone with a disability. This is paid at the same rate as an age or disability support pension and is fully means tested.

Carer Allowance can be paid in addition to carer’s payment.

While there is no asset test for the Carer Allowance, there is an annual household adjusted taxable income (ATI) test of $250,000 for the carer.

That means you and your partner’s income — including an add back of investment losses, like negative gearing, voluntary concessional contributions to super and reportable fringe benefits — must be below this limit.

There is no asset or income test for the person being cared for.

The Carer Allowance is now $159.30 per fortnight, a $5.80 increase on last year’s rate.

Medically, the person being cared for will need that care for 12 months or more and be assessed by a medical professional.

In essence, the person will need assistance with basic functions such as eating, dressing, hygiene, mobility, medication and other things on a reasonably frequent basis.

That care can be provided by a family member, even if they don’t live in the same home.

The annual capped cost of Pharmaceutical Benefits Scheme medicines increased on January 1.

For non-concession card holders, the maximum cost is $31.60 per script but the annual “safety net” increased from $1647.90 per annum to $1694 per annum.

Above this amount and your prescription medicines covered by the PBS are free. Note that these amounts can be household caps if you link the family members by filling in a “prescription record form” and then applying for a Safety Net Card, once you reach these limits.

Pensioners and other Commonwealth-issued concession card holders will still be paying a maximum of $7.70 per prescription which is the same as last year’s limit. Their annual cap is now $277.20 per annum.

The good news is that if you have private health insurance, all of your annual claim limits were reset on January 1.

Nick Bruining is an independent financial adviser and a member of the Certified Independent Financial Advisers Association