Child Support – How is it calculated and can the amount be changed?

What Is The Child Support Agency

The Child Support Agency is a Government Agency who have the responsibility of undertaking the task of making assessments of child support, in essence, they determine how much a parent is to pay as and by way of child support.

In addition to undertaking assessments of child support, the Child Support Agency can collect child support on behalf of a party by way of assessment or child support agreement, including by way of garnisheeing of wages, using the proceeds of a taxation refund and possible departure prohibition Orders restricting a person leaving the country when they have arrears of child support.

How is Child Support Calculated

In undertaking an assessment, the Child Support Agency adjusts a parent’s income taking into account a set amount for the parent’s self-support and any further dependent children. When determining income or as the Child Support Agency terms it, “Adjustable taxable income,” they take into account the parent’s taxable income for the last financial year, the parent’s reportable fringe benefits, the parent’s target foreign income, the parent’s total net investment loss, the tax free pensions or benefits received and the parent’s reportable superannuation contributions.

Child support is assessed from the date of lodgement of a case with the Child Support Agency.

The simplified manner in which child support is determined by the Child Support Agency is that they consider the income of both parents and the number of nights in each parent’s care, when determining how much a parent should be contributing to the child’s upbringing. Generally, the more time a parent spends with the child, the less child support that is payable as they are paying for the child’s living expenses whilst in their care.

Centrelink will usually require a person to take all reasonable steps to obtain child support prior to approving any government payments, as the amount of child support received by a person affects their Centrelink payments. This is so as to reduce the pressure on the public purse as the Government would rather a parent of a child contribute to the financial support of a child, rather than the entire burden being upon the tax payer.

Alteration of Child Support Assessments

There are two ways in which a child support assessment may be altered, the first by way of an administrative change, for instance, a change made by the Child Support Agency to the assessment due to receiving updated information as to the income or care percentages of a party and secondly,  a departure from formula assessment where there are “special circumstances” and if a new rate of child support is “just and equitable” and “otherwise proper”, which includes looking to the hardship that would be caused to both parents should the change be made or not. A departure application may only be made for the preceding 18 months and cannot be made for a longer period without the leave of the Court.

The term “special circumstances” is limited by the legislation and includes, costs of caring for a child, special needs of a child, caring, educating or training the children in a manner expected by parents, income and earning capacity of the child, money, goods or property from the payer for the benefit of the children, high costs of child care, necessary expenses in self-support, the income, earning capacity, property or financial resources of one or both parents, legal duty to maintain another person or other children, or responsibility to support a resident child significantly reduces capacity to support another child. The most common of the special circumstances for which we see is the payment towards schooling fees and the payment towards extraordinary medical expenses.

An example of a special circumstance when it comes to school fees is where a child has attended a private school during the relationship, however, after separation the Father refuses to make payment towards the school fees. In such instance, it is clear that both parents intended the child to attend the particular level of schooling and the Child Support Agency must consider the financial position of both parties in determining how much each parent should contribute towards the school fees.

The appropriate form to be lodged with the Child Support Agency in this instance is “Application to Change Your Assessment – Special Circumstances Form”.

Objection to a CSA Assessment

Parents must ensure that the Child Support Agency is aware at all times of the circumstances of both parties, including any changes to the care arrangements for the Children and income of the parties.

If you receive a child support assessment for which you are not satisfied, you must lodge a “Objecting to a Decision” Form within 28 days of the decision, which the Child Support Registrar will review.

If you still do not agree, you can seek a review of the decision which has been made within 28 days of the decision.

Within 28 days of receiving an Objection Decision, an Application is lodged with the Administrative Appeals Tribunal. The Administrative Appeals Tribunal is an external body to review decisions of government agencies and who make a decision afresh looking at all the available evidence.

Whilst objecting to a Child Support Agency Assessment, a child support liability will continue to accrue and the Child Support Agency may take steps to collect any outstanding monies, unless the assessment is stayed. An Application may be made to the Federal Circuit Court in this regard, which effectively suspends the child support assessment.

Should you have any queries regarding any aspect of child support, please contact one of our Solicitors on (07) 5679 8016 for a free fifteen minute telephone chat.

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