Raising a child involves financial responsibility, and when parents separate, child support ensures that both parents continue to contribute to their child’s well-being. In Australia, child support is designed to cover the costs of raising a child, including housing, food, education, healthcare, and other essential needs.
Understanding how child support works and how it’s calculated can help you plan for your child’s future and avoid potential disputes. In this guide, we’ll explain what child support is, how the calculation process works in Australia, and how to manage child support arrangements effectively.
What Is Child Support?
Child support is a legal obligation where one parent provides financial support to the other parent (or caregiver) to help cover the costs of raising a child after separation or divorce. The aim is to ensure that the child maintains a stable and secure standard of living, regardless of the parents’ relationship status.
In Australia, child support is governed by the Child Support (Assessment) Act 1989 and administered by the Services Australia – Child Support Agency.
Child support can cover:
- Everyday expenses (food, clothing, and housing)
- Education costs (school fees, uniforms, and extracurricular activities)
- Medical expenses (doctor visits, medication, and health insurance)
- Childcare costs (daycare or after-school care)
Both parents have a legal responsibility to contribute financially to their child’s upbringing, even if they are not involved in the child’s day-to-day care.
Who Pays Child Support?
Child support is usually paid by the non-custodial parent (the parent who does not have primary care of the child) to the custodial parent (the parent who provides the majority of day-to-day care).
However, if the care arrangement is shared equally or close to equal, both parents may be required to contribute financially based on their respective incomes and the amount of care they provide.
For example:
- If Parent A earns a higher income and provides 30% of the care, they may be required to pay child support to Parent B, who earns less and provides 70% of the care.
- If both parents earn similar incomes and share care equally, the child support payment may be minimal or balanced.
How Is Child Support Calculated in Australia?
The Australian government uses a specific formula to calculate child support. This formula considers several factors to ensure that both parents contribute fairly based on their financial capacity and the child’s care arrangements.
The child support formula includes the following key factors:
1. Income of Both Parents
Both parents’ adjusted taxable income is used to determine their capacity to support the child.
Adjusted taxable income includes:
- Wages and salaries
- Business and investment income
- Government benefits (e.g., Centrelink)
- Foreign income
- Fringe benefits and rental income
If one parent earns significantly more than the other, they may be required to contribute a higher percentage of the child’s financial needs.
2. Cost of Raising the Child
The government has established guidelines for estimating the cost of raising a child based on:
- The number of children involved
- The children’s ages
- The parents’ combined income
The cost of raising a child increases as the child grows older, reflecting the increased costs of education, healthcare, and other needs.
3. Percentage of Care Provided by Each Parent
The level of care each parent provides affects how much child support is required. The more time a parent spends caring for the child, the lower their financial obligation.
Care percentages are divided into five categories:
- Regular care – 14% to 34% of nights
- Shared care – 35% to 65% of nights
- Primary care – More than 65% of nights
- Major care – More than 86% of nights
- Sole care – 100% of nights
If a parent provides more day-to-day care, their financial obligation may be reduced, while the parent with less care time will likely have to pay more in child support.
4. Self-Support Amount
Each parent is allowed to retain a portion of their income to cover their personal living expenses before child support is calculated. This is known as the self-support amount and ensures that parents have enough income to meet their own basic needs.
5. Combined Income and Support Percentage
Once each parent’s income and care percentage are determined, the court calculates each parent’s child support percentage:
Child Support Percentage=Income Percentage−Care PercentageChild Support Percentage=Income Percentage−Care Percentage
- If a parent’s income percentage is higher than their care percentage, they may have to pay child support.
- If a parent’s care percentage is higher than their income percentage, they may receive child support.
Example of How Child Support Is Calculated
Let’s say:
- Parent A earns $100,000 per year
- Parent B earns $50,000 per year
- The total combined income is $150,000
- Parent A provides 30% of care while Parent B provides 70% of care
Parent A’s income percentage is:
100,000150,000×100=66.67%150,000100,000×100=66.67%
Parent A’s care percentage is 30%, so their child support percentage is:
66.67%−30%=36.67%66.67%−30%=36.67%
Parent A would be responsible for paying 36.67% of the child’s estimated expenses based on the government’s cost guidelines.
How to Apply for Child Support in Australia
If you need to arrange child support, you have two main options:
- Private Agreement
Parents can negotiate their own terms for child support and document them in a formal agreement. A private agreement allows flexibility but is not legally enforceable unless registered with Services Australia. - Child Support Assessment
You can apply to Services Australia to calculate and manage child support payments based on the official government formula. The payment terms are legally binding once registered.
Can Child Support Be Adjusted?
Yes. Child support arrangements can be modified if there is a significant change in circumstances, such as:
- A change in either parent’s income
- A change in care arrangements
- Increased costs for the child’s education, medical needs, or special circumstances
Both parents can agree to adjust the payment, or you can apply to Services Australia to reassess the agreement.
What Happens If Child Support Isn’t Paid?
Failure to pay child support can result in enforcement actions by Services Australia, including:
- Wage garnishment
- Seizure of tax refunds
- Suspension of passports
- Legal action
It’s important to seek legal advice if you’re having difficulty with child support payments or enforcement issues.
How Can a Family Lawyer Help with Child Support?
Navigating child support arrangements can be complicated, especially if there are disagreements about income, care arrangements, or expenses. A family lawyer can help by:
- Advising you on your legal rights and obligations
- Negotiating a fair child support agreement
- Assisting with a Services Australia assessment
- Representing you in court if necessary
Having professional legal guidance ensures that your child support arrangement reflects your financial situation and your child’s needs.
Simonidis Steel Lawyers Can Support You
Child support ensures that both parents contribute financially to raising their child after separation or divorce. The calculation process considers each parent’s income, care percentage, and the child’s estimated expenses to create a fair and balanced arrangement.
At Simonidis Steel Lawyers, we understand that child support arrangements can be stressful and complex. Our experienced family law team is here to guide you through the process and ensure that your agreement reflects your financial situation and your child’s best interests.
Contact Simonidis Steel Lawyers today for expert advice and support with child support matters. Let us help you achieve a fair and workable solution.
