New 457 visa rules come into effect from January 2017

This affects families on 457 visas whose children attend public schools

Source: Public Domain

If you are a 457 visa holder, have school-going children and reside in South Australia, this news is for you.

South Australia state government has proposed public education contribution fee for 457 visa holders.  

This affects families on 457 visas whose children attend public schools in South Australia. This move will affect significant number of Indian families settled in South Australia as they are the second largest group, after China, to hold 457 visa in South Australia.

These proposed changes are aimed at bringing South Australia in line with some other Australian states and territories and how they manage contributions towards public education.

What are the proposed changes?

From January 2017, newly arriving 457 visa holders will be required to contribute to the cost of educating their children in government schools. This requirement will then extend to all 457 visa holders from 1 January 2018.

The amount payable would be based on family circumstances and payment would be made when a child or young person is enrolled in a government school.

Contribution fees

The annual contribution payable by a family in South Australia on a 457 visa for 2017 would be:

• · $5,100 for each primary school student
• · $6,100 for each high school student

This amount would be charged for the eldest child in a family, with the fees for all siblings attracting a 10% discount.

The proposed changes would allow parents to elect to pay the contribution upfront annually, per semester, per term or in regular instalments.

How income affects the contribution

A contribution fee would not be charged unless the holder of the 457 visa and their spouse/partner earns a combined gross income of more than $57,000.

A means-test would be used, so that a family with one child at school would not pay the full contribution rate until the gross family income reaches $77,000. The threshold at which maximum fees are payable is increased by $10,000 for each additional child.

For example, a family with 2 school aged children would not pay full fees unless gross family income is $87,000 per year or more.

How do I determine my contribution fee?

You can determine your potential contribution fee by following these steps:

1. Calculate the full fees payable. This will be:

• · $5,100 for each government primary school aged student
• · $6,100 for each government high school aged student

Take into account the 10% discount available for second and subsequent children from the same family.

2. Figure out your anticipated annual gross family income (including salary sacrifice and overtime payments) rounded down to the nearest whole $1000.

3. Figure out which threshold applies – for which the full contribution is payable – based on the number of children attending government schools.

• · for 1 child this is $77,000
• · for 2 children from the same family this is $87,000
• · for 3 children from the same family this is $97,000

4. Where the family income calculated at step 2 exceeds the threshold calculated at step 3, the full contribution calculated at step 1 will apply.

What if our family income is between $57,000 and $77,000?

Where the family income is more than $57,000, but less than the threshold calculated at step 3, a percentage of the full fee calculated at step 1 is payable. The relevant percentage will depend on the number of children attending a government school.

For one child, the contribution percentage payable increases by 5% for each additional $1000 of income above $57,000. The percentage payable on this additional income changes with the number of children. For example:

• · 2 children by 3.33%
• · 3 children by 2.5 %

Who is exempted from this?

Where the family income calculated at step 2 is $57,000 or less, no contribution would be payable. A full or partial waiver of fees for exceptional cases of hardship would be available. If you are on a 457 visa and become a permanent resident you would no longer have to pay the contribution. You would need to provide evidence to the department so that your new residency status can be registered.

For the first year, the new charge will only apply to people who arrive in SA from January 1, 2017.

From January 2018 it will apply to all 457 visa holders living the state, regardless of when they arrived.

For more information or questions about how the proposed fee would operate, contact the department. Phone: [phone] Email: [e-mail] or visit their website: http://www.decd.sa.gov.au/aboutdept/pages/Aboutdept/visacontribution/