ATO stops clawing back tax refunds from struggling families
Authorities will stop an automated system clawing back tax refunds from struggling families.
Parents getting Family Tax Benefit were losing tax refunds. An automated system was designed to recover overpayments even when families faced severe financial hardship.
The Administrative Review Tribunal found the system was a jurisdictional error. People weren't told they could appeal on hardship grounds.
A government report noted many recipients rely on the tax refund. They need it to pay for basic essentials.
The ATO and Services Australia agreed to create new rules. These rules prevent overpayments being clawed back from vulnerable people in hardship.
New guidance and contact channels for affected families have been published. System changes will be needed.
No timeline has been set yet.
- Under age 15
- Children covered
- September last year
- Tribunal review began
Why it mattersFamilies facing financial hardship will now keep their tax refunds instead of losing them to an automated system that ignored their circumstances.
AustraliaAustralian parents on Family Tax Benefit will now be protected from losing tax refunds due to an automated debt-recovery system, and can appeal on hardship grounds.
✓ Claims checked against the source and corrected before publish. checked 1 h ago
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