Section 1061ZZFR — Social Security Act 1991: Treatment of debt

(1) A debt arising under or out of the contract is not a provable debt in the bankruptcy or for the purposes of the personal insolvency agreement. (2) A right of the Commonwealth or of the corporation to bring an action or other proceeding against the person in respect of the debt is not affected by the bankruptcy or personal insolvency agreement. (3) The trustee of the estate of the bankrupt person or the trustee of the personal insolvency agreement is not entitled to recover under the Bankruptcy Act 1966 a payment made by the person to the Commonwealth or to the corporation in respect of the debt. (4) In this section: debt arising under or out of the contract: (a) includes, but is not limited to: (i) an amount outstanding under the contract; and (ii) an amount that the person is liable to pay under section 1061ZZDE, 1061ZZDL, 1061ZZDV or 1061ZZEE; and (iii) an accumulated FS debt that discharges, or discharges the unpaid part of, an FS debt; but (b) does not include: (i) a debt constituted by an obligation to repay the amount of a payment that, because of paragraph 1061ZZCV(2)(a), 1061ZZCX(3)(a), 1061ZZDO(3)(a) or 1061ZZDY(3)(a), is not a payment of financial supplement; or (ii) an FS assessment debt that is required to be paid to reduce an accumulated FS debt.