Commonwealth Numbered Acts

SOCIAL SECURITY (BUDGET AND OTHER MEASURES) LEGISLATION AMENDMENT ACT 1993 No. 121, 1993 - SECT 7

7. After Division 4 of Part 3.10 of the Principal Act the following Division
is inserted in Part 3.10:

"Division 5-Earnings credit (benefits) Earnings credit account balance may be
set-off against ordinary income from remunerative work

"1115A.(1) If:

   (a)  a person is receiving a social security benefit (other than special
        benefit); and

   (b)  the person earns an amount of money for remunerative work done by the
        person during an earnings credit accounting period; and

   (c)  in that period, the person's fortnightly rate of ordinary income
        exceeds the person's ordinary income free area; and

   (d)  the rate of social security benefit payable to the person for the
        accounting period would otherwise be greater than nil; and

   (e)  immediately before the beginning of that period, the person's earnings
        credit account balance is greater than nil; then, in applying an
        ordinary income test to the person or to the person's partner,
        disregard:

   (f)  if the person's earnings credit account balance equals or exceeds the
        amount earned-the whole of the amount; or

   (g)  if the person's earnings credit account balance is less than the
        amount earned-the part of the amount that does not exceed the earnings
        credit account balance. Note: For 'ordinary income test' see:
Pension Rate Calculator A (Module E);
Pension Rate Calculator C (Module E);
Pension Rate Calculator D (Module F);
Benefit Rate Calculator A (Module H);
Benefit Rate Calculator B (Module G).

"(2) If:

   (a)  a person is receiving a social security benefit (other than a special
        benefit); and

   (b)  the person is a member of a couple; and

   (c)  the person's partner:

        (i)    is not receiving a social security or service pension; and

        (ii)   is not receiving a social security benefit; and

   (d)  the partner earns an amount of money from remunerative work done by
        the partner during an earnings credit accounting period; and

   (e)  in that period, the person's fortnightly rate of ordinary income
        exceeds the person's ordinary income free area; and

   (f)  the rate of social security benefit payable to the person for the
        accounting period would otherwise be greater than nil; and

   (g)  immediately before the beginning of that period, the partner's
        earnings credit account balance is greater than nil; then, in applying
        an ordinary income test to the person, disregard:

   (h)  if the partner's earnings credit account balance equals or exceeds the
        amount earned-the whole of the amount; or

   (i)  if the partner's earnings credit account balance is less than the
        amount earned-the part of the amount that does not exceed the earnings
        credit account balance. Note: For 'ordinary income test' see:
Benefit Rate Calculator A (Module H);
Benefit Rate Calculator B (Module G). Earnings credit accounts

"1115B.(1) If a person is receiving a social security benefit (other than a
special benefit), the person has an earnings credit account.

"(2) If:

   (a)  a person is receiving a social security benefit (other than a special
        benefit); and

   (b)  the person is a member of a couple; and

   (c)  the person's partner:

        (i)    is not receiving a social security or service pension; and

        (ii)   is not receiving a social security benefit; the partner has an
               earnings credit account.

"(3) The partner does not have an earnings credit account under subsection (2)
if the partner is receiving:

   (a)  a carer pension; or

   (b)  special benefit. Earnings credit account balance

"1115C. The person's earnings credit account balance is worked out using the
Earnings Credit Account Balance Calculator at the end of this section.
          "EARNINGS CREDIT ACCOUNT BALANCE CALCULATOR B


"MODULE A-OVERALL ACCOUNT BALANCE CALCULATION Account balance calculation

"1115C-A1. If the person has an earnings credit account, this is how to work
out the balance of the account:
Method statement Step 1. Work out the person's opening balance using MODULE B
below. Step 2. If the person has an earnings credit, add the amount of the
earnings credit to the account: see MODULE C below. Step 3. If the person
draws on the account, deduct from the account the amount drawn: see MODULE D
below. Account balance not to exceed $500.00

"1115C-A2. The balance of an individual account is not to exceed $500.00.
Balance not to be in debit

"1115C-A3. The balance of an earnings credit account is not to fall below nil.
EC accounting periods

"1115C-A4. The earnings credit accounting periods for an account established
under subsection 1115B(1) are the fortnights commencing on the first day in
each period for which an instalment of the person's social security benefit is
payable.

"1115C-A5. The earnings credit accounting periods for an account established
under subsection 1115B(2) are the fortnights commencing on the first day in
each period for which an instalment of the person's partner's social security
benefit is payable.
                   "MODULE B-OPENING BALANCE
General rule

"1115C-B1. The opening balance of the person's earnings credit account is nil.
Transferees from social security pensions or benefits or service pensions

"1115C-B2. Subject to point 1115C-B3, if:

   (a)  the person commences to receive a social security benefit; and

   (b)  immediately before commencing to receive the benefit, the person was
        receiving a social security pension, a social security benefit or a
        service pension and had an earnings credit account balance under this
        Act or Division 11 of Part III of the Veterans' Entitlements Act; the
        opening balance of the person's earnings credit account is the amount
        of that account balance.

"1115C-B3. If:

   (a)  a person commences to receive a social security benefit; and

   (b)  immediately before commencing to receive the benefit, the person was
        receiving a social security pension or a service pension and had an
        earnings credit account balance under this Act or Division 11 of Part
        III of the Veterans' Entitlements Act; and

   (c)  the earnings credit account was a joint account with the person's
        partner; the opening balance of the person's new earnings credit
        account is 50% of the balance of the joint account. Preservation of
        benefit earnings credit account balances for 13 weeks

"1115C-B4. If:

   (a)  a person commences to receive a social security benefit; and

   (b)  within the period of 13 weeks immediately before the person commences
        to receive the social security benefit, the person was receiving a
        social security benefit; and

   (c)  immediately before the person ceased to receive the earlier social
        security benefit, the person had an earnings credit account balance
        that was greater than nil; the opening balance of the person's
        earnings credit account is the closing balance of that earlier
        earnings credit account.

"1115C-B5. If:

   (a)  a person commences to receive a social security benefit; and

   (b)  the person is a member of a couple; and

   (c)  the person's partner:

        (i)    is not receiving a social security or service pension; and

        (ii)   is not receiving a social security benefit; and

   (d)  within the period of 13 weeks immediately before the person commences
        to receive the social security benefit, the person was receiving a
        social security benefit; and

   (e)  immediately before the person ceased to receive the earlier social
        security benefit, the partner had an earnings credit account balance
        that was greater than nil; the opening balance of the partner's
        earnings credit account is the amount of the closing balance of that
        earlier earnings credit account.
                      "MODULE C-EARNINGS CREDIT
When earnings credit arises

"1115C-C1. A person has an earnings credit for an EC accounting period if
during that period the person's fortnightly rate of ordinary income is less
than the person's ordinary income free area. Note 1: For 'EC (earnings credit)
accounting period' see points 1115C-A4 and 1115C-A5 above. Note 2: For
'ordinary income free area' see Module H of Benefit Rate Calculator A or
Module G of Benefit Rate Calculator B. Amount of earnings credit

"1115C-C2. If the person is not a member of a couple, the amount of an
earnings credit for an EC accounting period is $90.00. Note: This is the basic
free area plus all the maximum additional free area for income from personal
exertion. See point 1067-H9A (Benefit Rate Calculator A) and point 1068-G9A
(Benefit Rate Calculator B).

"1115C-C3. If the person is a member of a couple, the amount of an earnings
credit for an EC accounting period is $80.00. Note: This is half the basic
free area plus all the maximum additional free area for income from personal
exertion by the person. See point 1067-H10 (Benefit Rate Calculator A) and
point 1068-G10 (Benefit Rate Calculator B).

"MODULE D-DRAWING ON ACCOUNT Drawing on account (recipient account)

"1115C-D1. A person draws on an account established under subsection 1115B(1)
if:

   (a)  during an EC accounting period:

        (i)    the person earns an amount of money for remunerative work done
               by the person during that period; and

        (ii)   the person's fortnightly rate of ordinary income exceeds the
               person's ordinary income free area; and

   (b)  the rate of social security benefit payable to the person for the
        accounting period would otherwise be greater than nil; and

   (c)  immediately before the beginning of the EC accounting period, the
        person's earnings credit account balance was greater than nil. Drawing
        on account (partner account)

"1115C-D2. A person draws on an account established under subsection 1115B(2)
if:

   (a)  during an EC accounting period:

        (i)    the person earns an amount of money for remunerative work done
               by the person during that period; and

        (ii)   the person's partner's fortnightly rate of ordinary income
               exceeds the partner's ordinary income free area; and

   (b)  the rate of social security benefit that would otherwise be payable to
        the person's partner is greater than nil; and

   (c)  immediately before the beginning of the EC accounting period, the
        person's earnings credit account balance was greater than nil. Amount
        to be deducted

"1115C-D3. The amount to be deducted is the amount earned.".