Social Security and Other Legislation Amendment (Technical Changes No. 2) Act 2025 (79 of 2025)

Schedule 1 Income apportionment

Social Security Act 1991

2 After Part 3.10

Insert:

Part 3.11 - Income earned from employment between 1 July 1991 and 6 December 2020

Division 1 - Preliminary

1112 Simplified outline of this Part

This Part deals with the treatment of income earned from employment between 1 July 1991 and 6 December 2020.

Division 2 validates things done or that occurred before the commencement of this Part that would have been invalid merely because income apportionment was used in relation to the income for the purposes of calculating social security benefits and social security pensions, youth training allowance and former farm household support.

Division 2 does not validate any income averaging which was done in accordance with the debt assessment and recovery scheme known as Robodebt nor extinguish any causes of action in respect of an accrued general law right.

Division 3 deals with the treatment of certain income from employment that is earned, derived or received at certain times before 7 December 2020 for the purposes of calculating, after the commencement of this Part, social security benefits and social security pensions, youth training allowance and former farm household support.

Division 3 sets out the available approaches for the treatment of the income. These are to treat the income as if it had been first earned, derived or received:

(a) in the entitlement period in which it was earned; or

(b) in the entitlement period worked out using income apportionment; or

The approach to be used will depend on the information held by the person applying Division 3 in connection with a decision or review of a decision.

1113 Definitions

In this Part:

Division 2 work income means ordinary income for remunerative work of a person as an employee in an employer/employee relationship.

Division 3 work income , in relation to a person, means:

(a) in relation to income earned, derived or received on or after 20 September 2003 - employment income in relation to the person (within the meaning of section 8 as in force when the income is earned, derived or received) but does not include a payment of employment income that is received before the work to which the payment relates has been undertaken; or

(b) otherwise - ordinary income of the person:

(i) that is earned, derived or received, or that is taken to have been earned, derived or received, by the person from remunerative work undertaken by the person as an employee in an employer/employee relationship; and

(ii) that includes, but is not limited to, salary, wages, commissions and employment-related fringe benefits that are so earned, derived or received or taken to have been so earned, derived or received;

but does not include:

(iii) a superannuation payment to the person; or

(iv) a payment of compensation, or a payment to the person under an insurance scheme, in relation to the person's inability to earn, derive or receive income from that remunerative work; or

(v) a payment of ordinary income to the person that is received before the work to which the payment relates has been undertaken; or

(vi) a leave payment to the person in relation to which an income maintenance period arises under the Act as in force when the payment is received; or

(vii) a termination payment to the person in relation to which an income maintenance period arises under the Act as in force when the payment is received; or

(viii) a comparable foreign payment.

entitlement period means:

(a) in relation to a specified pension for a period ending before 1 July 1999 - a period starting on a pension payday and ending on the day before the next pension payday; or

(b) otherwise - a period determined by the relevant Secretary in relation to which an instalment of a social security benefit or a social security pension is paid and that ends before 7 December 2020.

FHS entitlement period means a period determined by the relevant Secretary in relation to which an instalment of former farm household support is paid and that ends before 1 July 2014.

FHS income apportionment method statement means section 1116.

former farm household support means the following payments and support under the Farm Household Support Act 1992 as previously in force:

(a) drought relief payment;

(b) exceptional circumstances relief payment;

(d) farm household support;

(e) restart income support.

general income apportionment method statement means section 1114.

payroll period : each period in relation to which a payment of Division 2 work income or Division 3 work income is made is a payroll period .

Example: If a person is paid weekly by the person's employer, the payroll period is the 7 days to which the payment relates. This is usually set out on the person's payslip.

relevant Secretary means:

(a) the Secretary of the Department; or

(b) the Secretary of the Department administering the Farm Household Support Act 1992 as previously in force; or

specified pension means:

(a) an age pension; or

(b) a bereavement allowance; or

(d) a carer pension; or

(e) a disability support pension; or

(f) an invalid pension; or

(g) a mature age allowance (paid under Part 2.12A); or

(h) a mature age partner allowance; or

(i) a pension PP (single); or

(j) a sole parent pension; or

(k) a special needs pension; or

(l) a widow B pension; or

(m) a widowed person allowance; or

(n) a wife pension.

validation time means the commencement of this Part.

YTA entitlement period means a period determined by the relevant Secretary in relation to which an instalment of youth training allowance is paid and that ends before 1 July 1998.

YTA income apportionment method statement means section 1115.

1114 General income apportionment method statement

For the purposes of this Part, the total amount and daily amount for an entitlement period, in relation to income of a person in relation to a payroll period, are worked out as follows:

Method statement

Step 1. Divide the amount of the income by the number of days in the payroll period.

Step 2. Work out how many days in the payroll period fall within the entitlement period.

Step 3. Multiply the amount from step 1 by the number of days from step 2. This is the total amount for the entitlement period.

Step 4. Divide the total amount for the entitlement period by the number of days in the entitlement period. This is the daily amount for the entitlement period.

1115 YTA income apportionment method statement

For the purposes of this Part, the total amount for a YTA entitlement period, in relation to income of a person in relation to a payroll period, is worked out as follows:

Method statement

Step 1. Divide the amount of the income by the number of days in the payroll period.

Step 2. Work out how many days in the payroll period fall within the YTA entitlement period.

Step 3. Multiply the amount from step 1 by the number of days from step 2. This is the total amount for the YTA entitlement period.

1116 FHS income apportionment method statement

For the purposes of this Part, the total amount and daily amount for a FHS entitlement period, in relation to income of a person in relation to a payroll period, are worked out as follows:

Method statement

Step 1. Divide the amount of the income by the number of days in the payroll period.

Step 2. Work out how many days in the payroll period fall within the FHS entitlement period.

Step 3. Multiply the amount from step 1 by the number of days from step 2. This is the total amount for the FHS entitlement period.

Step 4. Divide the total amount for the entitlement period by the number of days in the entitlement period. This is the daily amount for the entitlement period.

Division 2 - Calculations before the validation time

1117 Validation of income apportionment - social security benefits and social security pensions

Nothing is invalid merely because income apportionment was used

(1) A thing done or occurring is taken not to be, and is taken never to have been, invalid or ineffective merely because, before the validation time, the Division 2 work income of a person in relation to a payroll period was treated for the purposes of the social security law as if it had been first earned, derived or received by the person either:

(a) as an amount equal to the total amount for the entitlement period in each entitlement period that includes one or more days in the payroll period; or

(b) as an amount equal to the daily amount for the entitlement period on each day in each entitlement period that includes one or more days in the payroll period.

Note 1: A reference to the social security law includes a reference to the Farm Household Support Act 2014: see section 93 of that Act.

Note 2: Income may have been treated in accordance with this section in working out a person's income or the income of a partner of the person.

(2) For the purposes of subsection (1), the total amount and daily amount for an entitlement period are worked out in accordance with the general income apportionment method statement.

(3) To avoid doubt, anything done or occurring, or anything purported to have been done or to have occurred (whether under the social security law or otherwise), that would have been wholly, or partly, invalid or ineffective except for subsection (1) is taken for all purposes to be valid and effective and to have always been valid and effective.

(4) Subject to section 1117C, subsections (1) and (3) apply despite any effect that those subsections may have on the accrued rights of any person.

No validation of income averaging

(5) Subsection (1) does not apply in relation to treatment of Division 2 work income in accordance with the debt assessment and recovery scheme known as Robodebt and which comprised:

(a) from 1 April 2015 - the PAYG Manual Compliance Intervention program, including associated pilot programs; and

(b) the following iterations of the program mentioned in paragraph (a):

(i) Online Compliance Intervention, which applied to assessments initiated in the period from on or around 1 July 2016 to on or around 10 February 2017;

(ii) Employment Income Confirmation, which applied to assessments initiated in the period from on or around 11 February 2017 to on or around 30 September 2018;

(iii) Check and Update Past Income, which applied to assessments initiated after on or around 30 September 2018.

Separate treatment for youth training allowance and former farm household support

(6) Subsection (1) does not apply in relation to treatment of Division 2 work income in relation to youth training allowance or former farm household support.

Definitions

(7) In this section:

do a thing includes:

(a) make a decision (however described); and

(b) exercise a power, perform a function, comply with an obligation or discharge a duty; and

and purport to do a thing has a corresponding meaning.

1117A Validation of income apportionment - youth training allowance

Nothing is invalid merely because income apportionment was used

(1) A thing done or occurringis taken not to be, and is taken never to have been, invalid or ineffective merely because, before the validation time, the Division 2 work income of a person in relation to a payroll period was treated for the purposes of the relevant legislation as described in subsection (2).

Note: Income may have been treated in accordance with this section in working out a person's income or the income of a partner of the person.

(2) For the purposes of subsection (1), the Division 2 work income was treated as if it had been first earned, derived or received by the person as an amount equal to the total amount for the YTA entitlement period in each YTA entitlement period that includes one or more days in the payroll period.

(3) For the purposes of subsection (2), the total amount for a YTA entitlement period is worked out in accordance with the YTA income apportionment method statement.

(4) To avoid doubt, anything done or occurring, or anything purported to have been done or to have occurred (whether under the relevant legislation or otherwise), that would have been wholly, or partly, invalid or ineffective except for subsection (1) is taken for all purposes to be valid and effective and to have always been valid and effective.

(5) Subject to section 1117C, subsections (1) and (4) apply despite any effect that those subsections may have on the accrued rights of any person.

Separate treatment for former farm household support

(6) Subsection (1) does not apply in relation to treatment of Division 2 work income in relation to former farm household support.

Definitions

(7) In this section:

do a thing includes:

(a) make a decision (however described); and

(b) exercise a power, perform a function, comply with an obligation or discharge a duty; and

and purport to do a thing has a corresponding meaning.

relevant legislation means:

(a) the Student Assistance Act 1973; or

(b) the social security law as it relates to youth training allowance.

1117B Validation of income apportionment - former farm household support

Nothing is invalid merely because income apportionment was used

(1) A thing done or occurring is taken not to be, and is taken never to have been, invalid or ineffective merely because, before the validation time, the Division 2 work income of a person in relation to a payroll period was treated for the purposes of the relevant legislation as described in subsection (2).

Note: Income may have been treated in accordance with this section in working out a person's income or the income of a partner of the person.

(2) For the purposes of subsection (1), the Division 2 work income was treated as if it had been first earned, derived or received by the person:

(a) as an amount equal to the total amount for the FHS entitlement period in each FHS entitlement period that includes one or more days in the payroll period; or

(b) as an amount equal to the daily amount for the FHS entitlement period on each day in each FHS entitlement period that includes one or more days in the payroll period.

(3) For the purposes of subsection (2), the total amount and daily amount for a FHS entitlement period are worked out in accordance with the FHS income apportionment method statement.

(5) Subject to section 1117C, subsections (1) and (4) apply despite any effect that those subsections may have on the accrued rights of any person.

Definitions

(6) In this section:

do a thing includes:

(a) make a decision (however described); and

(b) exercise a power, perform a function, comply with an obligation or discharge a duty; and

and purport to do a thing has a corresponding meaning.

relevant legislation means:

(a) the Farm Household Support Act 1992 as previously in force; or

(b) the social security law as it relates to former farm household support; or

1117C Preservation of accrued rights

(1) This Division does not extinguish any cause of action in respect of an accrued general law right.

(2) Any legal proceeding or remedy in respect of a cause of action in respect of an accrued general law right that would, apart from the operation of subsection (1), be affected by the enactment of the Social Security and Other Legislation Amendment (Technical Changes No. 2) Act 2025 may be instituted, continued or enforced as if that Act had not been enacted.

(3) The Federal Court has jurisdiction with respect to matters arising under subsection (2) and that jurisdiction is exclusive of the jurisdiction of all other courts except the High Court.

Division 3 - Calculations after the validation time

1117D Allocating Division 3 work income to entitlement periods - social security benefits and social security pensions

When this section applies

(1) This section applies in relation to Division 3 work income of a person earned, derived or received:

(a) if the person was in receipt of a specified pension and had reached pension age when the Division 3 work income was earned, derived or received - during the period starting on 20 September 2009 and ending before 7 December 2020; or

(b) if the person was in receipt of a specified pension and was under pension age when the Division 3 work income was earned, derived or received - during the period starting on 20 September 2003 and ending before 7 December 2020; or

(2) After the validation time, the Division 3 work income is to be treated, for the purposes of the social security law, in accordance with this section.

Note: A reference to the social security law includes a reference to the Farm Household Support Act 2014: see section 93 of that Act.

(3) To avoid doubt, this section applies in relation to treatment of Division 3 work income whether in connection with a decision or review of a decision (including review under the Social Security (Administration) Act 1999 or review by the ART).

(4) This section does not apply in relation to treatment of Division 3 work income in relation to youth training allowance or former farm household support.

First approach - entitlement period in which income earned

(5) If the entitlement period in which the Division 3 work income was earned can be identified from the information held by the person applying this Division in connection with a decision or review of a decision, treat the Division 3 work income as if it had been first earned, derived or received as an amount equal to the relevant amount on each day in the entitlement period.

(6) For the purposes of subsection (5), the relevant amount is worked out by dividing the amount of the Division 3 work income by the number of days in the entitlement period.

Second approach - income apportionment

(7) If:

(a) subsection (5) does not apply; and

(b) the payroll period to which the Division 3 work income relates can be identified from the information held by the person applying this Division in connection with a decision or review of a decision;

treat the Division 3 work income as if it had been first earned, derived or received by the person as an amount equal to the daily amount for the entitlement period on each day in each entitlement period that includes one or more days in that payroll period.

(8) For the purposes of subsection (7), the daily amount for an entitlement period is worked out in accordance with the general income apportionment method statement.

Third approach - entitlement period in which income received

(9) If subsections (5) and (7) do not apply, treat the Division 3 work income as if it had been first earned, derived or received as an amount equal to the relevant amount on each day in the entitlement period in which the person receives the Division 3 work income.

(10) For the purposes of subsection (9), the relevant amount is worked out by dividing the amount of the Division 3 work income by the number of days in the entitlement period.

Fortnightly or yearly expressions of Division 3 work income

(11) If, in accordance with the operation of this section, a person is taken to receive a particular amount of Division 3 work income on each day in an entitlement period:

(a) the rate of the person's Division 3 work income on a fortnightly basis for that day may be worked out by multiplying that amount by 14; and

(b) the rate of the person's Division 3 work income on a yearly basis for that day may be worked out by multiplying that amount by 364.

Priority of provisions

(12) This section applies subject to:

(a) Division 2; and

(b) section 1073A as in force when the Division 3 work income is earned, derived or received; and

(c) point 1068B-D19 of the rate calculator at the end of section 1068B as in force when the Division 3 work income is earned, derived or received.

(13) If, disregarding this section:

(a) a provision of the social security law required the Division 3 work income to be taken into account in the fortnight in which it is first earned, derived or received; and

(b) that requirement was subject to another provision of the social security law;

this section applies subject to the provision mentioned in paragraph (b).

(14) Apart from subsections (12) and (13), this section applies despite:

(a) any other provision of the social security law; and

(b) any other law of the Commonwealth.

1117E Allocating Division 3 work income to entitlement periods - youth training allowance

When this section applies

(1) This section applies in relation to Division 3 work income of a person earned, derived or received before 1 July 1998.

(2) After the validation time, the Division 3 work income is to be treated in accordance with this section for the purposes of the following legislation (the relevant legislation ):

(a) the Student Assistance Act 1973;

(b) the social security law as it relates to youth training allowance.

(4) This section does not apply in relation to treatment of Division 3 work income in relation to former farm household support.

First approach - entitlement period in which income earned

(5) If the YTA entitlement period in which the Division 3 work income was earned can be identified from the information held by the person applying this Division in connection with a decision or review of a decision, treat the Division 3 work income as if it had been first earned, derived or received in that YTA entitlement period.

Second approach - income apportionment

(6) If:

(a) subsection (5) does not apply; and

treat the Division 3 work income as if it had been first earned, derived or received by the person as an amount equal to the total amount for the YTA entitlement period in each YTA entitlement period that includes one or more days in that payroll period.

(7) For the purposes of subsection (6), the total amount for a YTA entitlement period is worked out in accordance with the YTA income apportionment method statement.

Third approach - entitlement period in which income received

(8) If subsections (5) and (6) do not apply, treat the Division 3 work income as if it had been first earned, derived or received in the YTA entitlement period in which the person receives the Division 3 work income.

Priority of provisions

(9) This section applies subject to Division 2.

(10) If, disregarding this section:

(a) a provision of the relevant legislation required the Division 3 work income to be taken into account in the fortnight in which it is first earned, derived or received; and

(b) that requirement was subject to another provision of the relevant legislation;

this section applies subject to the provision mentioned in paragraph (b).

(11) Apart from subsections (9) and (10), this section applies despite:

(a) any other provision of the relevant legislation; and

(b) any other law of the Commonwealth.

1117F Allocating Division 3 work income to entitlement periods - former farm household support

When this section applies

(1) This section applies in relation to Division 3 work income of a person earned, derived or received before 1 July 2014.

(2) After the validation time, the Division 3 work income is to be treated in accordance with this section for the purposes of the following legislation (the relevant legislation ):

(a) the Farm Household Support Act 1992 as previously in force;

(b) the social security law as it relates to former farm household support;

First approach - entitlement period in which income earned

(4) If the FHS entitlement period in which the Division 3 work income was earned can be identified from the information held by the person applying this Division in connection with a decision or review of a decision, treat the Division 3 work income as if it had been first earned, derived or received as an amount equal to the relevant amount on each day in the FHS entitlement period.

(5) For the purposes of subsection (4), the relevant amount is worked out by dividing the amount of the Division 3 work income by the number of days in the FHS entitlement period.

Second approach - income apportionment

(6) If:

(a) subsection (4) does not apply; and

treat the Division 3 work income as if it had been first earned, derived or received by the person as an amount equal to the daily amount for the FHS entitlement period on each day in each FHS entitlement period that includes one or more days in that payroll period.

(7) For the purposes of subsection (6), the daily amount for a FHS entitlement period is worked out in accordance with the FHS income apportionment method statement.

Third approach - entitlement period in which income received

(8) If subsections (4) and (6) do not apply, treat the Division 3 work income as if it had been first earned, derived or received as an amount equal to the relevant amount on each day in the FHS entitlement period in which the person receives the Division 3 work income.

(9) For the purposes of subsection (8), the relevant amount is worked out by dividing the amount of the Division 3 work income by the number of days in the FHS entitlement period.

Fortnightly or yearly expressions of Division 3 work income

(10) If, in accordance with the operation of this section, a person is taken to receive a particular amount of Division 3 work income on each day in an FHS entitlement period:

(a) the rate of the person's Division 3 work income on a fortnightly basis for that day may be worked out by multiplying that amount by 14; and

(b) the rate of the person's Division 3 work income on a yearly basis for that day may be worked out by multiplying that amount by 364.

Priority of provisions

(11) This section applies subject to Division 2.

(12) If, disregarding this section:

(a) a provision of the relevant legislation required the Division 3 work income to be taken into account in the fortnight in which it is first earned, derived or received; and

(b) that requirement was subject to another provision of the relevant legislation;

this section applies subject to the provision mentioned in paragraph (b).

(13) Apart from subsections (11) and (12), this section applies despite:

(a) any other provision of the relevant legislation; and

(b) any other law of the Commonwealth.

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