The Child Support Assessment Act 1989 provides that when the Child Support Agency accepts an application for an assessment of child support, it must be calculated using a formula. Under the basic formula, the cost of raising children is calculated according to the adjusted taxable income of the parents, minus a self-support amount. It also takes into consideration the amount of time each parent spends with the child and the costs associated with this time. For example, regular care is assessed at between 52 and 127 nights a year, or 2 to 4 nights of care a fortnight which equates to a 24% child support cost percentage. The formula provides the child support amount the paying parent needs to pay to the other parent.
The formula assessment can be varied by taking into consideration special circumstances of the parties. There are currently 10 grounds that a parent or non-parent carer may use to make an application for a change of assessment:
- The costs of maintaining a child are significantly affected by high costs of enabling a parent to spend time with, or communicate with, the child
- The costs of maintaining a child are significantly affected by high costs associated with the child's special needs
- The costs of maintaining a child are significantly affected by high costs of caring for, educating or training the child in the way both parents intended
- The child support assessment is unfair because of the child's income, earning capacity, property or financial resources
- The child support assessment is unfair because the payer has paid or transferred money, goods or property to the child, the payee, or a third party for the benefit of the child
- The costs of maintaining a child are significantly affected by the high child care costs for the child (and the child is under 12 years of age)
- The parent's necessary expenses significantly affect their capacity to support the child.
- The child support assessment is unfair because of the income, earning capacity, property or financial resources of one or both parents
- The parent's capacity to support the child is significantly affected by:
- their duty to maintain another child or person,
- their necessary expenses in supporting another child or person they have a duty to maintain,
- their high costs of enabling them to spend time with or communicate with, another child or person they have a duty to maintain
- The parent's responsibility to maintain a resident child significantly reduces their capacity to support the child support child.
One of the most common grounds relied upon is Ground 1. The payer and the payee of child support are entitled to apply under this ground in relation to the costs incurred in enabling a parent to spend time with, or communicate with the child. A parent’s costs of maintaining a child will be considered high if the costs associated with spending time or communicating with the child total more than 5% of the parent’s adjusted taxable income for that period. It is common for parents that live interstate to apply under this ground.
Ground 3, if successfully established, can also result in a variation of a child support assessment. The applicant must establish that the costs of maintaining a child are significantly affected because the child is being cared for, educated or trained in the manner that was expected by the parents. This reason can apply to education or training outside the school environment, however the most common application for this reason involves the payment of private school fees. Both parents must agree to this type of education or training and it must be ‘just and equitable’ to the child, the payer and the payee.
Ground 6 is also a common ground relied upon. To successfully establish this ground, the child care costs must be more that 5% of the parents adjusted taxable income for the child support period and the child must be under 12 years of age. The costs must also be reasonable and necessary, for example, the parent or non-parent carer must have incurred the child care costs for a reason such as work or study commitments and the costs must be reasonable. Before and after school care and day care centre costs are generally regarded as reasonable child care costs. The parent or non-parent carer must also show evidence that the costs have been incurred or there is a definite commitment to costs.
You can make an application to change your assessment by obtaining a form from the following link: