Child Support is one of the most complicated and contentious issues for separated parents. Child Support can be very confusing to understand and can cause ongoing tension between separated parents, especially as Child Support is payable until a child turns 18 or finishes high school (whichever happens later).
What is Child Support?
Child Support is a financial payment made by one parent to the other parent (or carer) for the financial benefit of a child. Child Support is separate to the care arrangements of the child and any property settlement between the parents. However, the care arrangements can impact how much Child Support is paid/received. Further the parents can agree to incorporate Child Support negotiations into their property settlement discussions.
In Australia, Child Support is calculated by the Child Support – Services Australia (previously Department of Human Services – Child Support Agency).
It is also important to note that the Family Tax Benefits a parent can receive from Centrelink is impacted by Child Support.
How is Child Support calculated?
The amount of Child Support payable is calculated by a formula which is applied by Child Support – Services Australia. This is called a Child Support Assessment. The Child Support Assessment considers the following things:
- The number of children and their ages.
- The number of nights of care that each parent has of the children.
- The taxable income of each of the parents.
- If either of the parents have any other dependents (such as children from other relationships, it is important to note that stepchildren are not considered as dependent children for Child Support Assessments).
The Child Support Assessment is updated when circumstances change. Changes of circumstance can include when tax returns are completed if there is a change of income for one of the parents or if the care arrangements change. It is important that parents keep Child Support – Services Australia updated on any significant changes, as this could impact the Child Support Assessment and how much Child Support you are required to pay/receive.
Child Support – Services Australia has an online calculator that can be used to estimate how much Child Support is due to be paid or received. This calculator can be found here.
What does Child Support cover?
The Child Support Assessment is meant to assist in the cost of raising a child. Unless there is an agreement between the parents, the parent receiving Child Support (called “the receiving parent”) can decide how they use any Child Support they receive. The parent paying the Child Support (called “the paying parent”) cannot demand how Child Support is to be spent. In my experience as a Family Lawyer, how Child Support is used and what Child Support covers is one of the biggest concerns raised about Child Support.
The costs of raising children cover a range of things not just the obvious school fees and medical expenses. For example, the costs of raising a child includes living expenses such as rent or mortgage payments, the costs of utilities and the costs of operating a motor vehicle. It is also important to remember that the paying parent will also have to cover the costs of raising the child whenever they have care of the child.
What if I am not happy?
If you are not happy with your current Child Support arrangements, there may be options available for you with the assistance of an experienced Family Lawyer. For example, you may be able to enter into a private Child Support arrangement or a formal Binding Child Support Agreement. There may also be steps you can take with Child Support – Services Australia to ensure that the Child Support Assessment is more accurate.