Centrelink debt and tax return

**Doing my best** · August 7th, 2012, 06:39 AM

Hoping someone can answer this..

I have a debt with centrelink for overpaid CCB last financial year (knew it was coming due to me getting a permanent part time job and DH moving into a better paying role at his work), but I am confused with the payment details now showing on my centerlink page..

After FAO kept my CCR, there was a $600ish debt still to pay.. Been waiting for tax returns to see whether FAO kept the money owing to them, or whether we still needed to pay it manually from our tax return. There is a part payment with commet ATO tax refund w/h and a larger sum (which would cover the whole $600ish debt and still give some back to me) saying refund from ATO..

Does that mean I don't see any of my refund from the ATO even though it is more than the debt, or has the ATO sent my refund via FAO to clear my debt and they take an amount (either part or full) and give the rest to me?

I am a little confused. We have never had a debt before with FAO, so not sure how it works.

**briggsy's girl** · August 7th, 2012, 07:35 AM

if you are due a refund from ATO, it will come from ATO - it won't be paid via c'link
dont' have time to reply fully here - gotta go to work - will try to remember later

bump this tonight and i'll help in more details

**Beautiful Disaster** · August 7th, 2012, 07:36 AM

Thanks for posting DMB I think I'm going to have same thing happen to me for exactly same reasons although I over estimated DH and well and truly underestimated mine

bye bye tax return

**Tinks** · August 7th, 2012, 08:23 AM

It depends whether you ticked the box allowing your tax return to be used to pay off any FAO debt.

I had a debt last year of a lot more than $600 and still got both my and DH's tax returns. I just made up a payment arrangement with Centrelink, I think it was $60 a fortnight and it was paid off really quickly.

**Fuzzywuzzy** · August 7th, 2012, 08:38 AM

I under estimated our income and am expecting a FAO debt but haven't heard anything yet and can't see any details online either. We didn't tick the box to allow it to come from DF's tax return which was finalised more than a month ago and his taxable income from his NOA is showing in centrelink online. Is there a standard waiting period? I don't really want to waste my time and theirs on the phone.

**Doing my best** · August 7th, 2012, 08:44 AM

Thanks BG.. Will bump tonight if it isn't already..

Tinks - I thought about that.. I am not worried if they do take the money from the return (dh's tax is showing in our bank this morning). Just wondering what happens with the rest of my return that is in excess of what I owe as it is showing as a payment on my FAO account.

**LimeSlice** · August 7th, 2012, 08:56 AM

I had a PPP overpayment debt, I DID NOT tick the box on my tax return, and they withheld TWO YEARS worth of my tax returns regardless.

**Beautiful Disaster** · August 7th, 2012, 09:14 AM

I'm not sure if the accountant ticked the box

might call her

**Rowellen** · August 7th, 2012, 09:52 AM

I think the box PP are referring to is to repay your partners debt. If you have a debt yourself I think they will automatically withhold your refund. Refer to pages 9 & 11 of the individual tax return here.

**Beautiful Disaster** · August 7th, 2012, 10:24 AM

I just checked online and my ccr has been reco and I get money bank thus thurs. I wonder if I will get my entire tax back since I user estimated my ftb

My income has been updated to the actual but DH hasn't. Weird considering same accountant did both on same day one after the other

**briggsy's girl** · August 7th, 2012, 01:33 PM

It depends whether you ticked the box allowing your tax return to be used to pay off any FAO debt.

I had a debt last year of a lot more than $600 and still got both my and DH's tax returns. I just made up a payment arrangement with Centrelink, I think it was $60 a fortnight and it was paid off really quickly.

I think the box PP are referring to is to repay your partners debt. If you have a debt yourself I think they will automatically withhold your refund. Refer to pages 9 & 11 of the individual tax return here.

this is correct. if YOU have a debt, and YOUR return arriving at FAO is the one to trigger reco, you have no choice. your partner does though. if your information arrives before your partner though, your tax money won't be held up indefinitely waiting for reco to occur when your partner return arrives. this would be what happened with your Tinks - your information would have arrived several days before your other halfs, and you tax money released back to ATO to release to you before ATO gave FAO your partners return. had it been the other way around (his first), you would have had your return with held to pay against your FAO debt

I had a PPP overpayment debt, I DID NOT tick the box on my tax return, and they withheld TWO YEARS worth of my tax returns regardless.

there is no provision for FTB or ATO top ups to be used to pay against a debt raised against PPP - FAO reco payments are still paid even if PP debts exist. if you've had ATO payments with held against PPP debts, it would have been from a mercenary agent, not FAO

I just checked online and my ccr has been reco and I get money bank thus thurs. I wonder if I will get my entire tax back since I user estimated my ftb

My income has been updated to the actual but DH hasn't. Weird considering same accountant did both on same day one after the other

your online services will never show the specifics of DH's income for privacy reasons - what you will see is your information, and then the total family income at the bottom of the actual income.

In general:
CCB/CCR top ups can be used to pay current and previous year CCB/CCR debts only
FTB reco top ups can be withheld to pay current and previous year FTB reco, CCB/CCR or ATO debts
ATO tax returns can be withheld to pay current and previous year ATO, FTB reco, CCB/CCR debts

there is no choice in this - it is automatically actioned - you always have the right to appeal, but you have to show how legislation is wrong or unforseen hardship.

DMB, without seeing the specifics, it sounds like you are still getting a top up to come to you - whether it comes from ATO or from FAO is hard to say - most likely, your debt for an 11/12 year would be paid from any reco payment you are entitled to in the first instance (as FAO and CCR/CCB would reconcile at same time) and only what is left to be paid would come from your tax return. if it was a previous year debt (10/11 or earlier) it would be deducted from whichever lump sum was available first (generally your tax return)

**Doing my best** · August 7th, 2012, 01:56 PM

DMB, without seeing the specifics, it sounds like you are still getting a top up to come to you - whether it comes from ATO or from FAO is hard to say - most likely, your debt for an 11/12 year would be paid from any reco payment you are entitled to in the first instance (as FAO and CCR/CCB would reconcile at same time) and only what is left to be paid would come from your tax return. if it was a previous year debt (10/11 or earlier) it would be deducted from whichever lump sum was available first (generally your tax return)

Ok, that makes sense.. The past financial year is the only debt. So as my tax return was at least double what is owing, I will wait for it to come..

**Beautiful Disaster** · August 7th, 2012, 02:21 PM

your online services will never show the specifics of DH's income for privacy reasons - what you will see is your information, and then the total family income at the bottom of the actual income.

Oh ok cool it's showing a combined total.

Does that mean if I have no letter saying I have a debt I shouldn't get one?

**LimeSlice** · August 7th, 2012, 07:05 PM

there is no provision for FTB or ATO top ups to be used to pay against a debt raised against PPP - FAO reco payments are still paid even if PP debts exist. if you've had ATO payments with held against PPP debts, it would have been from a mercenary agent, not FAO

This is incorrect. This is what I was told by THREE CL employees while I was dealing with this, but that is exaclty what happened - it was the FAO that withheld it, and paid it against a PPP debt. I fought it, and it was overturned and returned to me, but it was made clear that they acted correctly, and they had the right to withhold it, for the PPP debt, despite my being informed three times that this was not the case. It was escalated a couple of times and the senior people I dealt with all confirmed that the inormation I had received was incorrect. I made a complaint about it, and was informed again that the three people I had spoken to had given me incorrect or out of date information, and this would be addressed in training of call centre staff, but ultimately the FAO could withhold any monies from the tax return to pay against ANY FAO debt.

**briggsy's girl** · August 7th, 2012, 07:17 PM

Oh ok cool it's showing a combined total.

Does that mean if I have no letter saying I have a debt I shouldn't get one?

you will get a letter within 4-5 weeks (depending on whether the outcome is caught up between FAO/ATO before then
i can't say you don't have a debt until you get that letter outlining that things have been finalised as it's possible there is a debt and the system is trying to get the funds from ATO to cover it
if you got a fao top up with supplements in it, you are probably safe though

LS, yours would be the first case i've heard of this happening in six years - i've paid thousands of dollars in ftb top ups to people that have massive debts for PP

ETA - actually LS, that's a lie - i have come across a situation similar - the scenario i can think of is that you had an ftb debt that was paid with your ato top up - perhaps a previous year non-lodger debt - and when it was shown you no longer had the ftb debt (tax returns received and debt waived), the amount that had been paid against the debt became an over-recovered debt - moneys for over recovered debts would, if you had no other debt, be returned to you - but if you have a debt, they can be used to pay any debt you have.
this is not an automatic process, which is what i was outlining earlier - it is manually applied by the debt recovery team. a PPP debt would not be paid DIRECT from FTB reco or ATO top ups. it would only occur if it was paid against an ftb reco debt and THEN the debt waived and the moneys already paid to that debt redistributed.