Last updated 16 Novemeber 2016
The majority of child support cases in Australia are dealt with by the Department of Human Services – Child Support (DHS – Child Support) under the Child Support (Assessment) Act 1989 (Cth) (CS(A) Act). There are some cases where the CS(A) Act does not apply and in those circumstances, a party seeking child support will need to apply for a child maintenance order under the Family Law Act 1975 (Cth) (Family Law Act).
Assessment by the Department of Human Services – Child Support
The DHS – Child Support will make an administrative assessment and determine the amount of child support payable for children after receiving an application from either parent or the carer of a child. Normally, the payee would apply for a child support assessment upon separation. A recipient of Centrelink payments for children has an obligation to seek child support. Application forms are available on the DHS website.
In some special circumstances, the DHS – Child Support will change the assessment on application from the payer or payee.
When the Department of Human Services – Child Support cannot make an assessment
Section 24 of the (CS(A) Act) sets out the circumstances in which children will be covered by the Act. When the DHS – Child Support cannot make an assessment for child support, it may still be possible to get a court order for child maintenance.
The DHS – Child Support cannot assess child support in matters where:
- the liable parent lives outside Australia in a country that is not a reciprocating jurisdiction
- children are over 18 years and dependent on their parents (e.g. full-time students or those with disabilities) (but maintenance might be sought under s 66L of the Family Law Act))
- maintenance is sought by a step-parent (but maintenance might be sought under ss 66M-66N of the Family Law Act in limited circumstances).
Who is liable to pay child support or maintenance?
Parents have a primary duty to support their children, and this duty has priority over all other commitments except the commitment for the parent to support themselves and any other child they have a legal duty to maintain. All children rank equally.
A parent must be an Australian resident or resident of a reciprocating jurisdiction to be assessed to pay child support under the CS(A) Act (s 29A). A list of reciprocating jurisdictions is found in sch 2 of the Child Support (Registration and Collection) Regulations 1988 (Cth).
If there is a dispute as to whether a person is in fact a biological parent of the child, either party can make an application to the court to seek DNA testing to resolve the dispute (ss 69V – 69ZD Family Law Act). Once parentage is determined, the court or the DHS – Child Support will assess the amount of child support/maintenance the liable parent has to pay.
A step-parent does not have a duty to maintain a child of the marriage unless a court orders otherwise (ss 66D and 66M Family Law Act). The court will look at the length of the relationship that has existed between the step-parent and the child to see if it is proper to make the step-parent liable for financial support of the child. Unlike a biological parent’s responsibility, however, the step-parent’s duty to support a child is secondary to the duty of the child’s natural parents to maintain the child.
Parents can be required to pay child support to non-parent carers.
Same-sex couples who have separated are able to apply for child support for any children from their relationship.
How much needs to be paid?
The DHS – Child Support assesses child support by using formulas that are set out in pt 5 of the CS(A) Act.
The formula used depends on the circumstances of the parents and living arrangements for the children. The general starting point is to work out the costs of maintaining children (see the Table in the Child Support Guide, which is based on independent research) and to ascertain if one or both parents’ income is taken into account. The following factors are relevant to ascertaining what is called the parent’s ‘adjusted taxable income’:
- the parent’s taxable income for the last relevant year of income in relation to the child support period
- the parent’s reportable fringe benefits total for that year of income
- the parent’s target foreign income for that year of income
- the parent’s total net investment loss (within the meaning of the Income Tax Assessment Act 1997 (Cth)) for that year of income
- the total of the tax free pensions or benefits received by that parent in that year of income
- the parent’s reportable superannuation contributions (within the meaning of the Income Tax Assessment Act 1997 (Cth)) for that year of income.
Income estimates can be lodged where the current income is at least 15% lower than the income used in the assessment, and estimates will be checked against actual income as soon as a tax return is lodged.
The formula recognises that the costs of maintaining teenage children are usually more than the costs of younger children. The parents share the costs of their children in proportion to the percentage of each parent’s income that exceeds what is called the ‘self-support amount’ (the minimum amount the parent needs to support themselves). The self-support amount for 2015 is $23 610, and this amount is revised annually.
The formulas also recognise that caring for a child is a means of supporting the child, so the number of nights the child spends in each parent’s household is linked to the amount of child support each parent is assessed to pay. In special circumstances, the Child Support Registrar may decide the percentage of care when the issue is actual care rather than the amount of care expected by care arrangements in place at the time.
For details about the exact calculations of child support in any particular instance contact the DHS – Child Support or look at the self-help calculators on the their website.
Collection of child support
Child support payments can be collected automatically by the DHS – Child Support. The DHS – Child Support encourages parents to arrange payment privately unless the payee receives a means-tested Centrelink benefit, and the payer does not have a good payment record.
If private collection proves unsuccessful, the DHS – Child Support will usually only collect up to three months of arrears (up to a maximum of nine months in special circumstances).
Children over 18
Under the CS(A) Act, a child must be under the age of 18 years in order for a parent to make an application for child support. The child support assessment automatically ceases when the child turns 18.
Child support or maintenance may be payable after the child turns 18 if the payee parent makes an application to the DHS – Child Support under s 151B of the CS(A) Act for the assessment to continue until the last day of secondary schooling in the year that the child turns 18. This application must be made after the child’s 17th birthday but before the child’s 18th birthday, otherwise a court application for maintenance must be made.
For court-ordered maintenance, the maintenance must be necessary for the child to complete their schooling or because the child has special needs as a result of a physical or mental disability (s 66L Family Law Act).
A court application for adult child maintenance can also be made where the adult child had acquired their physical or mental disability after they had turned 18 (see Re: AM (Adult Child Maintenance)  FamCA 351, here a Family Court decision was made for an order in respect of a 28-year-old child who contracted a degenerative disease at the age of 21).
Changing an assessment
The DHS – Child Support automatically makes new child support assessments as soon as new information about the parents’ incomes becomes available (s 75 CS(A) Act). This occurs when a parent lodges a tax return or advises the DHS – Child Support with an estimate that their current income is more or at least 15% lower than the child support income previously used.
The DHS – Child Support can also amend a child support assessment if the care percentage has changed by more than 7.1% (i.e. one night a fortnight) and it would affect the amount of child support payable.
An assessment can be varied to nil (s 66A CS(A) Act).
A payer or payee can also ask the court to change a child support assessment if there is an application for orders pending in the court (s 116(b) CS(A) Act). The application can be for any type of order. It is necessary to obtain the leave of a court before applying to change a child support assessment in a period more than 18 months before the application. Leave cannot be granted for a period of greater than seven years.
Other means of changing the assessment are:
- making a private arrangement with the other parent that may not involve the DHS – Child Support (but a payee receiving an income-tested pension or benefit from Centrelink cannot agree to accept less than the amount assessed by the DHS – Child Support)
- making a registered child support agreement with the other parent
- applying for a change to the assessment to the DHS – Child Support (but only for 18 months prior to the date of application) relying on the reasons based on s 117 of the CS(A) Act
- objecting to a decision of the DHS – Child Support.
Objections, reviews and appeals
Parents who are unhappy with the amount of child support payable should try to resolve the problem by first contacting the DHS – Child Support. Direct contact with the department sometimes allows parents to use simple administrative remedies. An objection form can be found on the DHS website.
If a payer and/or a payee dispute a decision made by the DHS – Child Support, they can apply to the Administrative Appeals Tribunal (AAT) for an external review of most DHS – Child Support decisions regarding the:
- refusal of extension of time to lodge an objection
- acceptance or non-acceptance of an application for assessment
- particulars of assessment (income or level of care)
- particulars of registration
- change of assessment
- low-income non-enforcement period
- refusal to remit penalties
- failure to collect arrears
- acceptance or refusal of a child support agreement
- credit or refusal to credit non-agency payments
- acceptance or refusal of an estimate.
The decision of the AAT is final on matters of fact, but there is a right to appeal to a court on a matter of law.
Child support agreements
It is the policy of the DHS – Child Support to encourage private arrangements between parents for the payment of maintenance and child support. These agreements can be either binding or limited agreements.
Binding child support agreements can be entered into only with a high level of formality (s 80C CS(A) Act). They operate in a similar manner to financial agreements that separating parents might make in relation to property, superannuation and spousal maintenance.
Key points about binding child support agreements:
- Each party to a binding child support agreement must receive independent legal advice from an Australian practising legal practitioner before entering or terminating the agreement.
- A binding child support agreement cannot be varied. However, it can be terminated and replaced with a new binding or limited child support agreement.
Binding agreements can be for a nil payment and can be used for property transfers.
Limited child support agreements are more flexible and less formal than binding agreements (s 80E CS(A) Act). Parties are not required to receive independent legal advice. In certain situations, either party can terminate a limited child support agreement.
Key points about limited child support agreements:
- A child support administrative assessment must be in place before the DHS – Child Support can accept a limited child support agreement.
- The amount payable under the agreement must be at least as much as would otherwise have been payable under the administrative assessment.
- The agreement can be terminated (s 80G CS(A) Act) by:
- either party if the notional assessment (that would have applied if there was no agreement) changes by at least 15% from the previous notional assessment
- either party after three years. This provides the parties with the flexibility to elect to end their agreement if it no longer suits their circumstances.
Assessment by the court
A court having family law jurisdiction (usually the Family Court, the Federal Circuit Court or a state Magistrates Court exercising Family Court jurisdiction) may make an assessment for child maintenance when the CS(A) Act does not apply.
Considerations regarding payment
In determining the amount of child maintenance to be paid, the court will consider the parents’ capacity to pay and the child’s needs (s 66H Family Law Act).
Matters taken into account in looking at the child’s needs include (s 66J Family Law Act):
- the income, earning capacity, property and financial resources of the child
- the child’s age and proper financial needs
- how the child is being educated and how the parties expect the child to be educated and trained (e.g. private or public school fees)
- the child’s special needs (e.g. health expenses)
- published research about child costs, specifically the figures prepared by the Institute of Family Studies (published quarterly).
An estimate of what would be payable if the child was covered by the child support scheme may also be a relevant consideration in determining the amount of child support payable.
Matters taken into account in looking at a parent’s capacity to pay include (s 66K Family Law Act):
- both parents’ income, earning capacity, property and financial resources
- both parents’ commitments for necessary personal support and the support of legal dependants (legal dependants will not usually include stepchildren unless the payer has formally adopted them)
- the direct and indirect costs in caring for the child
- any other special circumstances relevant in the interests of justice.
Collection of court-ordered payments
Court orders or court-registered agreements for maintenance can be registered with the DHS – Child Support who will then collect the maintenance on behalf of the payee. Court-ordered maintenance can be collected privately where both parties agree on a private collection arrangement. Note, however, that carer parents in receipt of a Centrelink benefit may not be able to enter into private collection arrangements without affecting their Centrelink benefit.
Cessation of child maintenance
Under the Family Law Act, maintenance for a child ceases on:
- the death of the child receiving maintenance (s 66U(1))
- the death of the person liable to make the payment (subject to certain restrictions) (s 66U(2))
- the child marrying, being adopted or entering into a de facto relationship (s 66V(1))
- the child’s 18th birthday, unless an order extends the maintenance period (s 66T).
Variation of maintenance orders
Either party to a court order for maintenance for a spouse or a child may apply to the court at any time for a variation of the order (s 66S Family Law Act). The court will vary the order if justified by:
- the change in the circumstances of the child
- the change of circumstances of either party
- a change to the cost of living
- material facts that were withheld from the court on a previous occasion or the previous consideration of false material evidence.
The court may increase or decrease payments or may suspend, discharge or revive the order. The court can discharge arrears of payments if it is satisfied that the payer had valid reasons for not paying and does not have any current capacity to pay the arrears.
Overseas child maintenance
Australia has international maintenance arrangements that apply when one parent lives in Australia and the other parent lives in a country that is a reciprocating jurisdiction.
Where one party does not live in a reciprocating jurisdiction, the only remedy available in Australia is to make an application for child maintenance to a court exercising family law jurisdiction. This is permitted even if a payment would be assessed by the DHS – Child Support as if the payer and payee were in Australia. However, enforcement against an uncooperative payer will be difficult if the payer has no assets in Australia.
International maintenance treaties
Australia is a signatory to bilateral treaties with New Zealand, Canada, the United Kingdom and the United States. The details of arrangements vary from country to country, but there are practical effects of these treaties. Arrangements with New Zealand are very similar to arrangements within Australia. The assessment is made in the country where the payee lives.
Where the payee lives in Australia and the payer lives in a reciprocating jurisdiction, an application for collection is made through the DHS – Child Support in Australia, who issues an assessment and asks the reciprocating jurisdiction to collect the child support.
Where the payee lives in a reciprocating jurisdiction and the payer lives in Australia, the DHS – Child Support collects the amount assessed in the reciprocating jurisdiction.
Information about Australia’s arrangements for international collection and assessment of child maintenance and support is found on the Department of Human Services website.