Monday, 22 October 2012

Do i qualify for Youth Allowance?

by Rob d'Apice
Are you 16-24 years old? Are you studying full-time or undertaking an apprenticeship? You may be eligible for Youth Allowance payments from Centrelink.

That's the good news! Want the bad news? It's ridiculously complicated. To get across all the nasty details, your best bet is to check out the Centrelink website, or head into your nearest Centrelink Service Centre. But for today, we're giving you Youth Allowance 101 - understand all the basic rules in 5 minutes before you waste hours navigating the depths of bureaucratic purgatory.

Are you independent from your parents?

If you're undertaking tertiary study and are aged 16-24, you're biggest hurdle to getting Youth Allowance will be likely be showing that you are independent from your parents. If you don't satisfy Centrelink's rules around independence, Centrelink will undertake a parental means test before making any payments. Specifically:
  • Parental income test. If your parents earn more $46 355 combined (at time of writing), your Youth Allowance payments will be reduced. If they are earning more than $100 000 combined, it's unlikely you'd receive any payment at all.
  • Family assets test. If your family's assets are greater than $619 500, you would not be eligible for Youth Allowance.
There's also a more complicated Family Actual Means Test if your family's income is more complicated - you'll be required to submit details of all your family's spending and savings for Centrelink to assess. It's pretty miserable, and another reason to try to prove you are independent. Check out all of Centrelink's details on asset and income tests.

How can you 'become' independent?

There are many ways you can be assessed as independent, but the most common ways to qualify are:

  • Be aged 22 or older, or
  • Be married or living with a de facto partner, or
  • Cannot live at home due to extreme family breakdown, or if you have parents that cannot exercise their responsibilities, or
  • Have worked full-time for 18 months over a 2 year period, or
  • Have earnt a sufficient amount of money through work. Come from an Inner Regional, Outer Regional, Remote or Very Remote area (check if your family home is in such an area using Centrelink's tool), and your parents earned less than $150 000 in the last financial year, and:
    • have earned more than roughly $21 000 over an 18-month period (the exact amount you need can be found using this table - find the row that covers the date when your 18-month period started, and use the number in the 3rd column), or
    • have worked part-time for 2 years

How much will you get?

Depending on whether you live at home, your age, and whether you have a partner, you'll receive between $220 and $402 per fortnight. You may receive more if you have children. See Centrelink's full payment rates table

Your payments will be reduced if you earn more than $400 per fortnight. For every dollar you earn about $400 per fortnight from employment, you'll lose 50 cents of your Youth Allowance. In other words, say you have already earned $400 this fortnight. If you want to do another shift that will earn you $100, you'll lose $50 worth of Youth Allowance - so you'll only get a net $50 for your shift.

Unused portions of your $400 per fortnight working threshold can be rolled over. If you only earn $100 from employment during a fortnight, Centrelink will add $300 to your Income Bank. That means if you earn $700 in the following fortnight, your Youth Allowance won't be reduced. Your Income Bank can reach a maximum credit of $10 000 (or $1 000 if you are an apprentice).

Over 24? Try Austudy.

If you're over 24, you won't qualify for Youth Allowance. If you're still studying, though, you can qualify for Austudy - you'll get the same amount of Youth Allowance (or more), and you don't have to worry about Independence rules or special rules when you live with your parents. No-one is judging you, but it's probably time you find your own place!

Note that some graduate studies (include doctorates) will not make you eligible for Austudy. Your previous studies may impact your eligibility for Austudy, too.

Aboriginal or Torres Strait Islander? Try ABSTUDY.

ABSTUDY is fairly similar to Youth Allowance in terms of rules. You'll still have parental means tests if you aren't independent, but the rules around how you get paid are different and in some cases more flexible. It would be worth talking to Centrelink in more detail about what you might be eligible for.