Child Support: What You Need to Know

Posted 10 Mar '22

Child Support in Australia

Child support in Australia can be a complex issue. In this blog, we have the answers to your most common questions.

How can I avoid paying child support?

Don’t have kids. While the answer may seem over-simplified, in the wise words of William of Ockham, the simplest solution is almost always the best.

If you are the parent of a child or children, then you are responsible for supporting them financially (in conjunction with the other parent of course). The only way to avoid paying child support is if the other parent agrees. In those cases, you would need to formalise any agreement through a Binding Child Support Agreement.

What is child support for?

Child support is a payment made to the other parent for the benefit of the children. The purpose of child support is to ensure that all of the children’s basic standards of living are met. This includes contributing towards shelter, utilities, clothes, food and education.

Although the general purpose of child support is to provide for the children’s needs, the payer does not have a say in how the child support is actually spent day to day. 

We share the kids 50/50. Why do I still have to pay child support?

The amount of child support payable isn’t just based on how much time the children spend with each parent. An equal care arrangement does not necessarily mean that no child support will be payable.

Child support is calculated using a specific formula. Generally speaking, the amount of child support takes into account the number of nights with each parent, the children’s ages, each parent’s income, and how much money each parent needs to support themselves.

If you are wondering how much child support should be paid based on a certain care arrangement, have a look at the Child Support Estimator on the Department of Human Services Website here: https://processing.csa.gov.au/estimator/About.aspx

Is the child support system fair?

One of the common complaints we hear about the child support calculation is that it takes into account each parent’s income. In unfortunate cases, this encourages parents to reduce their income to reduce the amount of child support they have to pay, or to reduce their income so that they receive more child support.

Parents must keep in mind what is in the best interests of their children, and the need for them to be supported financially. Keep in mind that the Court takes into account whether a parent has fulfilled their obligation to support the child when they make orders for parenting arrangements. If you care about your children’s wellbeing, then don’t bite your nose to spite your face (or to spite the other parent, as the case may be).

We urge parents not to use the care of their children as a tool to receive more child support, or to pay less child support. Making parenting decisions based on disdain for the other parent just never ends well for the kids.

What if the other parent won’t pay?

Child support can be paid privately between parents. But where that becomes too difficult, then you can contact the Child Support Agency and they will collect the payments on your behalf.

In the majority of cases, the Agency receives the money and pays it to the other parent without issue.

However, where one parent refuses to make the payments, or attempts to avoid the Agency, then they have a wide range of powers to collect the child support.

This includes:

• Contacting a parent’s employer and garnishing their salary;
• Taking the money from tax refunds, or directly from a parent’s bank account;
• Deducting money from Centrelink or other government payments the parent may have received;
• Stopping a parent from being able to leave the Australia without paying the debt; or
• Taking action in the Courts to recover the child support owing.

What if the assessment is unfair?

Sometimes circumstances change, and the previous assessment is no longer reasonable.

If this happens, you can lodge an application for a change of assessment with the Agency directly. There are a number of reasons why a previous assessment is no longer appropriate. Maybe one parent’s employment has changed, or the care arrangements have changed, or there are extra costs associated with the special needs of a child.

What is a Binding Child Support Agreement?

A binding child support agreement is a written agreement between parents that outlines the amount of child support payable and when it will be paid. As the name suggests, you cannot have a binding child support agreement unless both parties agree.

Sometimes, in circumstances where parents already earn relatively similar incomes, they will agree that neither will pay the other child support. Alternatively, binding child support agreements regularly cover a range of other expenses such as:

• Extra-curricular activities;
• School fees; and
• Larger medical costs including braces, dental or specialist appointments.

Do you need legal advice?

In order for a child support agreement to be binding, both parents must obtain independent legal advice. Your solicitor is required to sign a certificate of advice to confirm that they have informed you of the advantages and disadvantages of the agreement, and be sure you are aware of your rights and obligations. It is extremely important for your lawyer to understand your financial circumstances before you enter into the agreement, as having it set aside by the Court can be very difficult.

What are the advantages of a binding child support agreement?

There are a number of advantages to entering a binding child support agreement. These include:

• Providing security and certainty for parents.
• Fixing the amount of child support you pay even if circumstances change (for example, if the other parent reduces their income, you won’t pay more).
• Allowing both parents to do their best to increase their incomes, without worrying about the impact this will have on child support.
• Providing flexibility to parents regarding the amount of payments, and when and how they are paid.
• Enabling parents to tailor child support to their own specific circumstances.

What are the disadvantages of a binding child support agreement?

It is extremely important to keep in mind the inherent risks associated with entering a binding child support agreement. Some of these include:

• Your circumstances may change. Think about what you would do if 12 months after signing the agreement you lost your job. If your agreement is not drafted with an appropriate termination clause, it will continue in force. This could mean that you are liable to pay an amount you can no longer afford, or that you are unable to support the children because the payment do not reflect the current circumstances.
• For the agreement to be binding, both parties are required to obtain independent legal advice and there is of course a cost associated with this. In our experience however, the upfront cost generally outweighs the long-term cost and gives our clients peace of mind.
• Child support is linked to the family tax benefit. Parents must be aware that if they enter into an agreement that lowers the child support they receive, the family tax benefit will still be calculated based on what you should have received based on a Child Support Agency assessment.
• Binding child support agreements can be difficult to set aside. They will stay in place unless:
• There is a terminating event. This generally includes if the child turns 18 or dies, but can include other events (i.e. If a parent’s income drops below a certain level). The parties then have to enter into a termination agreement, which will incur more legal fees.
• The parents agree to terminate it early.
• It is terminated by the Court, which can be a very costly exercise.

Advice for Parents

We cannot stress the importance of expert legal advice if you are considering entering into a binding child support agreement. We have a wealth of experience in child support matters, and have assisted countless clients over the years. If you are having difficulty with your child support arrangement, or are considering entering into a binding agreement, contact us today on 07 3317 8322 for no obligation advice.

Please note the content of this post is information only and not legal advice.  If you require legal advice it is best to contact one of our lawyers who can review your particular circumstances and then provide tailored advice according to your needs.