The latest Centrelink Family Tax Benefit update lifted the FTB Part A maximum to $970.90 per eligible child for 2026-27, up from $938.05 in 2025-26. The core issue isn’t the higher rate, it’s whether your balancing lines up with your actual income, because that’s where families cop debt or lose part of the payment.
If you’re juggling school costs, rent, childcare, or a sole trader income that moves around from quarter to quarter, this payment matters more than many realise. The mistake I see over and over is simple: people watch the rate notice and ignore the reconciliation rules that decide what they really keep.
What Family Tax Benefit Is and Why This Update Matters
Family Tax Benefit is a Centrelink family payment for eligible carers of children. It comes in two parts, FTB Part A and FTB Part B, and Services Australia indexes it on 1 July each year so the payment can move with the new financial year. For 2025-26, Services Australia lists FTB Part A maximums of up to $235.48 per fortnight for a child aged 0 to 12, $306.46 per fortnight for a child aged 13 to 15, and $306.46 per fortnight for a child aged 16 to 19 who meets the study rules, with a base rate of $75.60 per child per fortnight and an annual supplement of up to $938.05 per eligible child (Services Australia family tax benefit guidance).
What actually changes the outcome
The higher rate matters, but only if your family lands inside the income rules. Services Australia says FTB eligibility turns on care, income, and reconciliation, not just the headline rate, so families with changing wages or shared care can see very different results at balancing time (Services Australia payment rates guidance).
Practical rule: don’t treat FTB as a set-and-forget benefit. If your income, partner income, or care percentage changed, your estimate needs to change with it.
The four things that move the needle are estimate accuracy, partner income, shared care percentage, and sole-trader income volatility. Get those wrong and the higher 1 July rate won’t save you from a debt later.
For families who want the broader money picture sorted, a family financial planning playbook can help you keep the household budget tied to the actual Centrelink payment, not wishful thinking.
Current FTB Rates for 2025-26 and 2026-27
The 1 July rate lift helps, but the year-end reconciliation decides what you keep. The main movement is in FTB Part A. FTB Part B stays a separate family payment with its own rules for the youngest child. Services Australia says the 2026-27 annual Part A supplement is $970.90 per eligible child, up from $938.05 in 2025-26, and that the payment is balanced after the year ends (Services Australia family tax benefit).
| Payment component | 2025-26 | 2026-27 |
|---|---|---|
| FTB Part A maximum, age 0 to 12 | up to $235.48 per fortnight | up to $235.48 per fortnight |
| FTB Part A maximum, age 13 to 15 | up to $306.46 per fortnight | up to $306.46 per fortnight |
| FTB Part A maximum, age 16 to 19, if study rules are met | up to $306.46 per fortnight | up to $306.46 per fortnight |
| FTB Part A base rate | $75.60 per child per fortnight | $75.60 per child per fortnight |
| FTB Part A annual supplement | up to $938.05 per eligible child | up to $970.90 per eligible child |
| FTB Part B maximum, youngest child 0 to 4 | $200.34 per family per fortnight | $200.34 per family per fortnight |
| FTB Part B maximum, youngest child 5 to 18 | $139.86 per family per fortnight | $139.86 per family per fortnight |
| FTB Part B annual maximum | $459.90 per family | $478.15 per family |
What shifts the final payment
These figures are maximums, not a promise of what lands in your account. Your Family Tax Benefit income test, your care percentage, and whether your estimate holds up at reconciliation all affect the final result.
The age of the youngest child changes Part B. That is the rule families miss when they compare payments with another household and expect the same result.
If your family income sits near a threshold, the table is only the starting point. The income test decides whether the headline rate applies at all, and estimate accuracy decides whether you keep it.
FTB Part A Versus Part B and Who Qualifies for Each
FTB Part A is the per-child payment. FTB Part B is the extra family payment for households with one main income earner or a single parent. They serve different jobs, and plenty of families get one but not the other.
The simple decision rule
If you’re asking “how much Family Tax Benefit can I get?”, start here. Part A is tied to the child and the family income test. Part B is tied to the youngest child and who earns the main income.
Services Australia says FTB eligibility requires care for at least 35% of the time and an income test, while Part B is capped at $200.34 a fortnight when the youngest child is under 5 and $139.86 when the youngest child is 5 to 18, with a 2026-27 annual maximum of $478.15 per family (Services Australia family tax benefit guidance).
Single parents, grandparents raising children, and some separated parents can receive both parts together. Dual-income couples often still receive Part A, but Part B is usually where they fall away.
Who usually qualifies for what
- Part A: the broad payment for eligible carers with children, subject to the income test.
- Part B: the extra payment for single-income or single-parent households.
- Both together: common for single parents and some separated care arrangements where one carer has the primary load.
The key point is blunt. Part A is about the child and family income. Part B is about reduced earning capacity in the household. Mixing those two up leads to bad estimates and bad decisions.
Income Tests and Adjusted Taxable Income Explained
A parent can look on track all year, then lose part of the Family Tax Benefit at balancing time because the income test uses adjusted taxable income, not just taxable income. That figure can include reportable super contributions, net rental losses, and foreign income. A business owner can have steady cash coming in and still be over the line once Services Australia does the balancing check.
How the taper works
Services Australia says the maximum rate reduces by 20 cents for each dollar above the first income threshold, and the base rate reduces by 30 cents for each dollar above the second threshold (Services Australia income test for Family Tax Benefit Part A). The thresholds change depending on family mix, so there is no single cut-off you can apply to every household.
| Component | Lower Threshold (per child) | Upper Threshold (per child) | Taper Rate |
|---|---|---|---|
| FTB Part A maximum rate | varies by family type | varies by family type | 20 cents per dollar above the first threshold |
| FTB Part A base rate | varies by family type | varies by family type | 30 cents per dollar above the second threshold |
Use your own estimate carefully. If you want a quick check before you update myGov, the income tax calculator can help you pressure-test the income figure you are putting into your FTB estimate.
Why sole traders get blindsided
Sole traders get caught out because business turnover isn’t the same as taxable income, and adjusted taxable income can differ again from the profit and loss figure you are staring at. A quiet quarter, a strong run, or a late BAS can all change the final entitlement.
Partner income matters too. Services Australia usually counts the partner’s income whether or not you treat it as shared money, so leave it out at your peril.
Bottom line: FTB entitlement depends on more than the payment rate. The income-reconciliation calculation often determines the final outcome, and the estimate has to be right before the year closes.
How to Claim FTB and Update Your Details Through myGov
If you’ve never claimed before, do it properly. Services Australia expects families to claim through myGov and keep details current as income and care arrangements change.
First-time claiming flow
- Link Centrelink to myGov.
Open your myGov account and connect it to Centrelink before you start the claim.
- Choose the family assistance claim.
Select Make a Claim, then choose Family Assistance.
- Enter each child’s details.
Add the child, your care arrangement, and any shared-care percentage.
- Estimate income for the financial year.
Use a realistic estimate for both partners if relevant.
- Upload or confirm documents.
Keep your records ready.
What to have ready
- TFN for each child
- Birth certificate or proof of birth
- Current bank details for both parents
- Latest payslips
- Sole-trader BAS summary or recent profit summary
How to update an existing claim
- Update Family Income Estimate if income changes.
- Edit Family Details if care percentages change.
- Resubmit promptly after any material change.
Services Australia also says recipients must confirm family income after 30 June, and the 2025-26 balancing window begins in July 2026. The final outcome depends on the actual year’s income and care percentages, not the number you guessed in the middle of the year (Services Australia online account help).
A Worked Example of an Estimate Versus Actual Income Gap
Priya runs a sole-trader design business in Melbourne. She has two children, she has full care, and she estimated her 2025-26 family income at $65,000 because work had slowed down. That estimate kept her payment flowing through the year, including the annual supplement expectation.
By June, the business picked up hard. Her actual adjusted taxable income landed at $92,000, which pushed her well above what she had told Centrelink. The payment didn’t magically become fraud. It became a balancing problem.
What changed
- Estimated income: $65,000
- Actual income: $92,000
- Gap: $27,000
That gap is large enough to reduce FTB Part A materially, and it can also knock out Part B if the household no longer fits the lower-income rules. The annual supplement that looked safe earlier in the year can be reversed or clawed back once Services Australia reconciles the file.
| Item | Estimate ($65,000) | Actual ($92,000) | Difference |
|---|---|---|---|
| FTB Part A | higher estimated entitlement | lower reconciled entitlement | reduced after balancing |
| FTB Part B | potentially payable | may drop out | lost or reduced |
| Annual supplement | expected earlier | reassessed after balancing | can be reversed |
| Net effect | no debt expected | debt likely | around $3,400 recoverable debt |
The lesson is simple. Priya didn’t do anything unusual. She just left the estimate too low for too long. A mid-year update would have softened the shock and given her a cleaner cash flow position.
Common FTB Pitfalls for Sole Traders and Separated Parents
The traps are operational. People miss a change, leave the estimate stale, then cop the balancing letter later.
The common mistakes I see
- Sole-trader income swings: BAS figures can change sharply from one period to the next.
Quick fix: update your estimate in myGov as soon as the change is material.
- Catch-up invoices or lump sums: one payment can throw off the year’s income picture.
Quick fix: review the estimate as soon as the receipt hits.
- Family trust distributions: they can change how partner income needs to be reported.
Quick fix: flag distributions before lodging.
- Care percentage drift after holidays: parenting time shifts and nobody updates Centrelink.
Quick fix: reconcile care days regularly if the arrangement is unstable.
- Child support changes: they can alter the income picture in ways families miss.
Quick fix: check the assessment whenever the parenting arrangement changes.
- FTB and CCS confusion: people mix up child care care percentages with FTB care percentages.
Quick fix: don’t assume the same percentage applies to both payments.
Separated parents need to be especially careful after a new parenting plan. If neither parent updates Centrelink, the split can be wrong for months. For families dealing with separation and benefit issues, the divorce and separation guidance helps line up the finance, care, and reporting pieces.
For sole traders, irregular income is the other big problem. A quiet quarter, then a strong one, can leave your estimate behind reality. That is where debts start to build, because the payment was based on old numbers. Keep quarterly check-ins on the calendar and treat any estimate gap as a fix-now job, not a later job.
Practical Next Steps and How Nanak Accountants Can Help
If your income or care situation has shifted since your last FTB estimate, update myGov this week. Don’t wait for balancing. A stale estimate is where overpayments and Centrelink debt notices start. If you are a sole trader and the last quarter was better or worse than expected, refresh the figure now so the payment reflects real numbers, not guesswork.
A sensible clean-up starts with four moves. Update your FTB estimate if income has changed. Check shared care if parenting time has shifted. Review partner income before the next payment cycle. Reconcile business results if you run a sole trader or small business.
Nanak Accountants and Associates can help you reconcile FTB against your tax return, test adjusted taxable income scenarios, and review trust distributions or business income before you lodge. If a debt notice arrives, they can help you work through the Centrelink side with the numbers in front of you, not from memory.
Talk to specialist before it costs you
15-minute discovery call. No obligation, no jargon.
For sole traders, the sole trader accounting guidance is the right place to start when income moves around and your FTB estimate needs to be tied back to current figures.
Book a consultation with Nanak Accountants and Associates if your latest BAS, profit summary, or partner income has changed. Bring your myGov login, payslips, and child support assessment if you are separated. That gives us enough to check whether your current estimate still holds and fix the gaps before balancing does it for you
