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What is the Parenting Payment and how can it help me?

Jodie Humphries avatar
Jodie Humphries
- 4 min read
What is the Parenting Payment and how can it help me?

If you’re concerned about the cost of raising children on your family income, there is Government support available that could assist you. The income support payment from the Government while you’re a young child’s primary carer is called the Parenting Payment. This payment is organised through Services Australia. Your and your partner's income and assets determine the amount of support you could receive.

Disclaimer

This article is over two years old, last updated on June 2, 2022. While RateCity makes best efforts to update every important article regularly, the information in this piece may not be as relevant as it once was. Alternatively, please consider checking recent savings accounts articles.

Parenting Payment eligibility

The Parenting Payment is only offered to those who are the principal carer of a child. If you're single, the child must be younger than eight and, if you have a partner, the child must be younger than six years of age.

A principal carer is defined as having the majority of responsibility for the day-to-day care, welfare and development of a child. If the child’s care is shared between yourself and your partner, you may need to nominate which of you is to be designated as the principal carer.

You cannot apply for the Parenting Payment before the birth of your child. You need to submit your claim within four weeks of your child's birth or the date the child has come into your primary care.

If you’re looking to receive the parenting Payment, you and your partner need to meet the income and assets tests to be eligible.

Parenting Payment income test

To receive the full benefit of the Parenting Payment, your gross income must be within a defined limit. The limit depends on the number of children you have and whether you are single or reside with a partner.

Income limits per number of children for single parent payment

Number of children Gross income limit per fortnight to get the full payment
 1$194.60
 2$219.20
 3$243.80
 More than 3$243.80 plus $24.60 for each extra child.

Source:Services Australia

For every dollar you earn over the gross income limit, you’ll get a 40 cent reduction in your Parenting Payment.

Income limits if you have a partner

When you share the care of the child with a partner, you can qualify for a part payment if you meet all of the following conditions:

  •  Your income is less than $1,123.17 a fortnight.
  •  Your partner earns less than $2,079.50 a fortnight.
  •  Your combined income is below $2,247.17 a fortnight.

If your partner’s income is over $1,124 gross a fortnight, it will affect how much of the Parenting Payment you are eligible to receive. 

Assets test

To qualify for the Parenting Payment, there are limits on the value of your assets. The limits differ for singles and couples, as shown in the following table.

Your situation Homeowner Non-homeowner
Single$270,500$487,000
A couple, combined$405,000$621,500
A couple, one partner eligible, combined$405,000$621,500

Source: Services Australia

Is the Parenting Payment considered as taxable income?

Yes, the Parenting Payment is a taxable Centrelink payment. You can request that tax contribution is deducted from each of your payments, or that you receive the full amount and pay your tax yourself.

Mutual Obligations Requirements

You may be required to fulfill Mutual Obligations Requirements, meaning a set of conditions related to part-time working or training, in order to continue to receive the Parenting Payment. If you cannot meet these Mutual Obligations Requirements for any reason, you will need to apply for an exemption.

What is the Family Tax Benefit?

The Family Tax Benefit (FTB) is a two-part payment that may also help you meet the costs of raising children. To receive this, you must have responsibility for a dependent child or a full-time secondary student between 16 and 19 years of age who is not receiving a pension or benefit such as Youth Allowance. You must be responsible for the care of the child at least 35 per cent of the time. 

If your family has an adjusted taxable income of $56,137 or less, you may be eligible for the maximum FTB Part A benefits. Your benefit reduces as your income rises above that level. 

For FTP Part B, the maximum rate per family per fortnight is $162.54 when the youngest child is between 0 and 5 years of age and $113.54 when the youngest child is between 6 and 18 years.

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Product database updated 20 Jun, 2024

This article was reviewed by Personal Finance Editor Alex Ritchie before it was published as part of RateCity's Fact Check process.