Income support for self-employed people

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For more detailed information about income support, please see the policies tab.

What you need to do 

If you haven't already, you will need to talk to the TAC about your eligibility for loss of earnings benefits. During this talk you will be asked to provide some information about your business. This may include:

  • Business details, including:
    • Business name
    • Type of business
    • ABN
  • Contact details of your accountant
  • Details about your pre-accident weekly earnings
  • Bank account details including:
    • Bank, branch and account name
    • BSB and account number

The TAC will send you a loss of earnings benefits summary which outlines the information you provided during the conversation. It will also ask for the documents we need to complete your loss of earnings assessment.
These documents may include:

  • Business Activity Statements
  • Individual income tax records
  • Completed Tax File Number Declaration form

How the TAC calculates loss of earnings benefits for self-employed people

First the TAC calculates how much you were earning (less expenses) before your accident.

Secondly, the TAC applies a special formula which, in most cases, results in a TAC payment of 80% of your assessable income.

Working out your loss of income

The way the TAC works out your loss of income will depend on how your business is structured. Please read the section that applies to you.

If you operated as a sole trader or in a partnership

As a sole trader or partner, your income loss may be a result of lost earnings, or having to pay someone to do the work you would normally do.

The TAC will calculate your assessable income by looking at:

  • Your past three years of taxable earnings*
  • The costs you incurred to hire someone to replace you.

If your business has been operating for less than three years, we will look at the whole period the business has been operating.

Generally, you cannot claim both lost income and the cost of hiring someone.

* Exceptions may be made where there is a clear upward or downward trend prior to your accident.

The information you need to provide to make your claim is here.

If your business is set up as a company or a trust

If your business operates as a proprietary limited company and you receive a salary or wage, the TAC will calculate your weekly earnings based on your salary or wages before the accident. If your business operates as a trust and you receive wages or distributions, the TAC will pay loss of earnings benefits in some cases.

To find out if you are eligible for loss of earnings benefits call 1300 654 329.

The information you need to provide to make your claim is here.

Information the TAC will not include when assessing your claim

  • Cash payments or income that was not declared with the Australian Taxation Office
  • Income you received from interest
  • Rental income
  • Income from dividends
  • Any other income you received through non-personal exertion

Working out your TAC rate

The following table is a guide to how the TAC works out your rate. The amounts listed below are based on weekly gross income.

A

If your income is below $612*, you will be paid the full amount of your income.

B

If 80% of your income falls below $612*, you will be paid $612.

C

If 80% of your income falls between $612* and $1,250, you will be paid 80% of your income.

D

If 80% of your income is greater than $1,250, you will be paid $1,250.

* $612 applies to you if you have no dependants. If you have one dependant, your rate is $785. For each additional dependant add $55. Dependants include anyone who is reliant on you for financial support.

The TAC can only pay you the dependant rate if it is less than 100% of your weekly income.

The dollar amounts listed are for the period 1 July 2015 to 30 June 2016. These amounts are indexed each financial year.

The TAC will deduct tax from your loss of earnings benefits. If you have a HELP debt, the TAC will also deduct the appropriate HELP payment. If you must pay family maintenance, the TAC may deduct an amount designated by the Child Support Agency

When you will be paid

The TAC pays loss of earnings benefits on a fortnightly basis into your nominated bank account.

You will be sent a Pay As You Go (PAYG) summary at the end of the financial year to include in your tax return.

Certificate of capacity required

To make a loss of earnings payment the TAC must have a certificate of capacity from your doctor that states your capacity to work is affected because of your accident injuries. It must also state how long your capacity to work will be affected.

Please take note of the date that your certificate of capacity finishes. To ensure continuous payment of your loss of earnings benefits, please send the TAC any further certificates of capacity at least five working days before your current certificate runs out.

Can I get my accountant to contact the TAC?

The TAC encourages your accountant to speak with us to move things along. You need to give the TAC permission to work with your accountant if you did not sign a TAC claim form at a hospital. To do this, please complete and send us the Authority to Release Information form you received with the Claim Acceptance pack. The Authority to Release Information form can also be downloaded on our website.

I have taken out a personal accident policy in the event I am unable to work. Am I still entitled to claim income benefits from the TAC?

You are entitled to receive income support from the TAC, regardless of the terms of your personal accident policy. You should however check with your insurer or broker, as exclusions may exist in that policy.

My business involves a partnership and as a result of my accident, the business has ceased operation. How will my income be assessed?

Your income is determined on the basis of your financial record/taxation return and physical contribution to the business. The TAC determines the percentage of contribution. In some cases the TAC may pay for the cost of hiring someone to carry out the work you cannot do.

What should I do if this year's tax return has not been lodged?

Depending on the period of your self-employment, income evidence is required for the most recent financial year. In cases where this is not possible, the previous financial year is usually sufficient.

How do I prove my income if my business has just started operating?

If your business has only been in operation for the current financial year, a profit and loss statement prepared by your accountant for the current trading year would assist.

Do I get back pay if I submit my claim form or provide requested information late?

The TAC can back pay income support as long as you make your claim within 12 months of the date of your accident and you are entitled to receive income support. You will also need to supply the TAC with certificates of capacity supporting your inability to return to work because of your accident. To claim income support or other support services, you need to telephone the TAC on 1300 654 329. A trained TAC staff member will then explain what entitlements you may have and gather the information needed to commence the claim process.

View Loss of earnings benefits

Loss of earnings benefits

Summary:

The TAC can pay you loss of earnings benefits while you are unable to return to work due to your accident injuries. Loss of earnings benefits is a temporary income support while you recover enough to return to work.

View Loss of earnings benefits for self employed people

Loss of earnings benefits for self employed people

Summary:

This booklet provides useful information about the loss of earnings benefits that the TAC can pay self-employed clients who have lost income as a result of their accident injuries. As well as setting out how loss of earnings benefits are calculated and paid, the publication explains ways the TAC can help you return to work.

View Returning to work

Returning to work

Summary:

This booklet explains how TAC clients can work positively with their employer, health professionals and the TAC to coordinate a safe and smooth return to work. It outlines the TAC services and benefits, such as workplace assessments and modifications, that are available to assist return to work. There's also a useful planner tool and answers to frequently asked questions about return to work programs.

View Return to work - activity planner

Return to work - activity planner

Summary:

A handy template document for TAC clients who are returning to work to organise their various treatment appointments, exercises and work commitments.

View Authority to pay entitlement: employer form

Authority to pay entitlement: employer form

Summary:

It is strongly recommended that you speak with a TAC claims manager or income officer prior to completing this form as it will have an effect on your income entitlement and tax obligations. Additionally, changes to future payments will not commence until contact has been made.

This form is for clients to authorise the TAC to make payments directly to their employer.