Brinkworth and Secretary, Department of Social Services (Social services second review)

This matter concerned an appeal by the Applicant against a decision to affirm a debt raised for overpayment of Family Tax Benefit (FTB) and Schoolkids Bonus (SKB) for the 2014/2015 income year. The Applicant had initially declared she would not lodge a tax return for that year as her income was below the tax-free threshold. However, she later lodged a tax return, which triggered a reconciliation of her FTB payments and the subsequent raising of a debt. The Applicant argued that she was not required to lodge a tax return, or that the timeframe for lodgement should have been extended, and sought waiver or write-off of the debt.

The Tribunal was required to determine whether the Applicant had been overpaid FTB and SKB, which hinged on whether an effective claim for FTB had been made. This involved considering whether the Applicant was required to lodge an income tax return for the 2014/2015 income year, whether it was lodged within the prescribed timeframe, and if not, whether the lodgement period could be extended due to special circumstances. If an overpayment was found, the Tribunal also had to consider whether it constituted a legally recoverable debt and whether recovery should be waived or written off.

The Tribunal noted that an FTB claim is not effective if the claimant was required to lodge an income tax return by the end of the income year following the relevant income year and had not done so. The deadline for lodging the 2014/2015 tax return was 30 June 2016. The Applicant lodged her return on 7 February 2017, after this deadline. The Tribunal found that the Applicant was required to lodge an income tax return for the 2014/2015 income year, despite her income being below the tax-free threshold, due to a net rental property loss claimed. As the return was lodged late and no extension had been granted, the Applicant's claim for FTB for that year was deemed never to have been made, resulting in an overpayment. The Tribunal affirmed the decision to raise the debt.