Child Support Explained

What is Child Support?

Child Support in Australia is a payment made by a parent to the other parent to help cover the costs of raising a child after separation or divorce. The payment is usually made by the non-custodial parent to the parent who has primary care of the child(ren).

The amount of child support to be paid is determined by a formula set by law and calculated by the Child Support Agency, taking into account various factors such as the income of both parents, the number of children involved, and the amount of time the children spend with each parent and the capacity to pay.
It is designed to ensure that both parents contribute to the financial support of their child in a fair and equitable manner.

What does Child Support Cover?

Child support payments are intended to cover the basic costs of raising a child, including:

1. Food for the child, including groceries and meals.
2. Housing for the child, such as rent or mortgage payments, utilities and maintenance.
3. The cost of clothing and footwear for the child.
4. The cost of education, such as school fees, books and uniforms.
5. Healthcare such as doctor’s visits, prescription medication, and health insurance premiums.

What does Child Support Not Cover?

These are some expenses that are not covered by child support payments. These expenses may include:

1. Private school fees: Child support payments do not cover private school fees, unless both parents agree to share the cost.
2. Extracurricular activities: Child support payments generally do not cover the cost of extracurricular activities such as sports, music lessons or dance classes. These costs are usually the responsibility of the parent who chooses to enrol the child in the activity, often jointly agreed and jointly paid either equally or proportional to income.
3. Medical expenses: While child support payments may cover some medical expenses, such as prescription medication, they generally do not cover major medical expenses such as dental work or surgery. These expenses are usually the responsibility of both parents, who may need to negotiate a separate agreement for payment.
4. Travel expenses: Child support payments do not cover the cost of travel, such as airfare or petrol expenses, unless both parents agree to share the cost.
5. Personal items: Child support payments do not cover personal items such as toys, books or electronic devices. These costs are usually the responsibility of the parent who chooses to purchase them for the child.

How is Child Support Collected

There are a number of ways Child Support can be collected, including:

1. Direct payment: The non-custodial parent can make direct payments to the custodial parent, either through regular bank transfers or in cash. This method of payment is not recommended as it can be difficult to track and enforce.
2. Child Support Agency (CSA) collection: The CSA can collect child support payments on behalf of the custodial parent and transfer them to them. The CSA can also take action to enforce payment if necessary.
3. Private collection: The non-custodial parent can arrange to make child support payments directly to a private collection agency, which will then transfer the payments to the custodial parent.
4. Salary deduction: The CSA can arrange for child support payments to be deducted directly from the non-custodial parent’s salary or wages, even without consent in a garnishee process.
5. Tax return interception: The CSA can intercept any non-custodial parent’s tax refund and use it to pay child support arrears.
6. Lump sum payment: The non-custodial parent can make a lump sum payment of child support, either voluntarily or as ordered by the court.’
7. Arrears can be taken by the CSA as lump sums from the non-custodial parent’s bank account.

What is a Binding Child Support Agreement?

A binding child support agreement is a formal agreement between parents or caregivers that sets out the terms of child support payments. The agreement can be made either before or after separation and can cover ongoing or one-off payments.

A binding child support agreement can be a useful way for parents or caregivers to formalize an agreement regarding child support payments, without having to go through the Child Support Agency. The agreement must be in writing, signed by both parties and witnessed, and must comply with certain legal requirements to be legally binding.

The key benefit of a binding child support agreement is that it allows parents or caregivers to agree on a child support arrangement that suits their particular circumstances, rather than having to follow the standard formula used by the Child Support Agency. This can provide greater flexibility and certainty for both parties, and it is not necessarily adjusted by each spouses’ income that year or upon the CPI or other factors you do not control.

Important Disclaimer: The content of this article is general in nature and for reference purposes only.  It does not constitute legal advice and should not be relied upon as such.  Legal advice about your specific circumstances should always be obtained before taking any action based on this publication.