Editors --- "Family tax benefit: whether payable; effect of absences from Australia; whether special circumstances exist for a review after 52 weeks from the decision" [2011] SocSecRpr 2; (2011) 13(1) Social Security Reporter, Article 2

• SECRETARY TO THE DFHCSIA and RAHIM
• Background
• Evidence
• Discussion
• Findings
• Formal decision

---

Family tax benefit: whether payable; effect of absences from Australia; whether special circumstances exist for a review after 52 weeks from the decision

SECRETARY TO THE DFHCSIA and RAHIM

(2010/946)

Decided: 23rd November 2010 by K. Hogan

Background

On 7 March 2004, Rahim departed for Afghanistan with his wife and two children.

Rahim and his wife had departed and returned to Australia on three occasions before 7 March 2004 as follows:

• departed 20 August 1999 and returned 17 October 2009

• departed 10 July 2000 and returned 30 May 2001

• departed 26 June 2001 and returned 12 September 2003.

It was not disputed that Rahim and his children were Australian residents for the purposes of the Act during the period of absences from Australia.

Rahim’s first child, Hanzala, was born in Afghanistan on 14 December 2002 and Rahim claimed family tax benefit (FTB) in respect of this child on 17 September 2003 with the benefits being paid from 12 September 2003. His second child, Huemza, was born in Australia on 24 November 2003 and Rahim received FTB in respect of Huemza from the date of birth. Thus, at the time of Rahim’s departure on 7 March 2004 he was receiving FTB in respect of both children.

On 20 April 2004, Centrelink cancelled FTB payments because Rahim had failed to respond to a notice dated 30 March 2004. A cancellation notice was sent on 20 April 2004.

On 25 September 2006 while in Afghanistan, Rahim emailed Centrelink regarding FTB entitlements and any entitlement to backpay.

On 31 March 2009, Rahim and his family returned to Australia and on 2 April 2009 Rahim contacted Centrelink in relation to claiming FTB and to request a review of the decision on 20 April 2004 to cancel FTB.

An authorised review officer (ARO) decided on 2 November 2009 to affirm the decision to cancel FTB, to not pay any backpay and to not pay FTB for the 2007/8 financial year.

On 11 May 2009, Centrelink raised and sought recovery of a debt of $533.32 of FTB from 7 March 2004 to 19 April 2004 on the grounds that Rahim had departed Australia on 7 March 2004 and had therefore been overpaid. An ARO affirmed the debt on 12 February 2010.

On 4 February 2010, Rahim sought review of the above ARO decisions at the Social Security Appeals Tribunal (SSAT). The SSAT decided that Rahim was entitled to be paid FTB for three years from 7 March 2004 to 6 March 2007. Centrelink was to calculate the FTB payable and if Rahim was paid more FTB than he was entitled from 7 March 2004 to 19 April 2004, then a debt existed and the debt was to be recovered. The SSAT also found that Rahim was not entitled to FTB in the 2007/8 financial year.

The Secretary to the DFHCSIA sought review of the SSAT decision.

Evidence

Rahim was admitted involuntarily to Graylands Hospital on February 2004 and was diagnosed with Schizoaffective Disorder and Polysubstance abuse. He had a history of psychotic disorder going back to 1993 and at least 6 admissions to Graylands.

Rahim’s wife could not understand English and therefore the family decided to take Rahim to Afghanistan on 7 March 2004 so that his mother could look after him. Rahim’s GP supplied medicine to Rahim while he was in Afghanistan. Rahim had numerous breakdowns in Afghanistan, received Electro Convulsive Therapy in Pakistan, was heavily sedated and placed in chains.

Rahim did not recall receiving a notice from Centrelink regarding FTB cancellation and his wife had not been able to make arrangements for forwarding mail.

Discussion

The discussion turned on the interpretation of the Act with respect to absences from Australia. Subsection 24(4) provides that the maximum period for an individual to be eligible for FTB is 3 years beginning on the first day of absence. Subsection 24(5) provides that if the absence is more than 26 weeks but less than 3 years, then a return to Australia of less than 26 weeks is to be disregarded when applying ss.24(4).

The Secretary argued that Rahim was eligible for FTB in respect of Hanzala from 14 December 2002, the date of birth. Rahim had been absent from 10 July 2000 to 12 September 2003 with an absence of less than 26 weeks from 10 July 2000 to 30 May 2001. Rahim ceased to be eligible while absent from Australia on 10 July 2003 which was 3 years since the first day of absence.

The departure on 7 March 2004 was less than 26 weeks from the return date of 12 September 2003. Therefore, Rahim was not eligible for FTB from 7 March 2004 to 31 March 2009. Rahim was eligible while in Australia (ss.24 (6)).

Rahim argued that ‘entitlement to receive FTB does not crystallize until a claim is made in accordance with the Administration Act’. When Rahim commenced his absence from Australia on 10 July 2000 and during the absence until the return on 12 September 2003, he was not eligible for FTB. He did not become eligible on 14 December 2002 when Hanzala was born because he did not make a claim and crystallize the entitlement. Thus, Rahim became eligible when he made a claim in respect of Hanzala on 17 September 2003 which was paid from 12 September 2003.

In essence, Rahim argued that the provisions of s.24 do not come into operation unless a claim has been made. When Rahim left in 2004, that was the first time he was both eligible and entitled to FTB and the 3 year period of eligibility should run from March 2004.

Findings

The AAT considered whether Rahim asked for a review of the decision to cancel family tax benefit made on 20 April 2004 within the time frame specified in s.109D of the Administration Act which was 52 weeks from the date of decision or an appropriate period longer than 52 weeks as determined by the Secretary. The AAT accepted Rahim’s email of 25 September 2006 as a request for review. The AAT considered that there were special circumstances which took Rahim’s case ‘out of the ordinary’ (see Groth v Secretary, Department of Social Security (1995) 40 ALD 451). Those circumstances included Rahim’s mental illness; the fact that his wife could not understand English; and that Rahim was overseas when Centrelink’s notices were sent. The AAT determined that it was appropriate for Rahim to have until the end of 2007 to seek review.

The AAT agreed with Rahim’s interpretation of the legislative framework. When Rahim left Australia in 2004, he was both an eligible and an entitled recipient of FTB and the three year time period in s.24(4) did not start to apply until that departure.

A distinction was drawn between eligibility (an entitlement to do something) and entitlement (the right to do something) noting that the words were not interchangeable. However, one ‘cannot be eligible ... without being entitled’ (Reasons, para.80).

Rahim was not eligible for FTB until 12 September 2003 and therefore his earlier departures and returns did not apply and ss.24(5) did not apply.

Formal decision

1. The decision under review was affirmed as follows:

(a) Rahim was entitled to be paid FTB in the period 7 March 2004 to 6 March 2007.

2. (b) Rahim was not entitled to be paid FTB in the 2007/8 financial year.

[M O’H]