How does child support work and how do divorced parents allocate funds properly? Child support is an important topic among divorce or separation matters. Child support is a sum of money that one parent gives to the other to assist with the expense of raising children. In Australia, Services Australia runs the Child Support Scheme that governs child support.
The program makes sure that divorced parents split up the cost of raising their children just as they would have if the family had remained together. Services Australia determines amount of child support by a formula that considers various factors. Some of the factors include:
- The income of both parents
- The number of children; and
- The amount of time each parent spends caring for the children.
- Whether the parent receiving child support is eligible for a family tax benefit
We will discuss these factors and explore how child support works in Australia.
Key Takeaways
- Child support is a payment that one parent makes to the other parent to help cover the costs of raising a child.
- Services Australia administers the Child Support Scheme. The scheme ensures that separated parents share the costs of supporting their children.
- Child support payments are calculated based on a number of factors such as the income of both parents and the amount of care given to the child.
- Parents can make their own child support agreement, but these agreements must be approved by Services Australia or the family court.
- Child support payments can be adjusted if there is a change in circumstances, such as a change in income or the amount of time spent caring for the child.
- Family lawyers can help draft binding child support agreements or limited child support agreements. The type of agreement you choose will depend on your circumstances.
How Does Child Support Work: What to Include in Child Support?
Child support payments are intended to cover the child’s basic needs, including:
- Food: This includes the cost of groceries, meals, and any special dietary requirements.
- Clothing: This covers the cost of everyday clothing, school uniforms, and seasonal attire.
- Shelter: This includes the cost of rent or mortgage payments, utilities, and household maintenance.
- Education: This covers the cost of school fees, textbooks, educational resources, and extracurricular activities.
- Healthcare: This includes the cost of medical expenses, dental care, and prescription medications.
- Childcare: This covers the cost of daycare, babysitters, or other childcare arrangements.
- Transport: This includes the cost of public transport, fuel, or any transport-related expenses.
- Miscellaneous: This covers any additional expenses related to the child’s well-being and development.
Allocating Child Support Funds Properly
As part of the question of “how does child support work?”, parents may wonder how to allocate child support funds properly. Parents receiving child support should prioritise using the funds to meet the child’s basic needs. This ensures that their children receive adequate food, clothing, shelter, education, and healthcare.
Once these essential needs are met, parents can allocate the remaining funds towards extracurricular activities, hobbies, or savings for the child’s future. Importantly, it’s crucial to maintain transparency and accountability when paying child support. The following tips can help parents allocate child support funds properly:
- Keeping detailed records of expenses and receipts can help demonstrate responsible financial management.
- Avoiding using child support funds for personal expenses or non-essential items.
- Upholding effective communication between parents is essential for ensuring child support funds are used appropriately.
- Discussing the child’s needs and expenses can help both parents make informed decisions about allocating the funds effectively.
Remember, child support is for providing financial stability for the child and contributing to their overall well-being. By using child support funds responsibly, parents can ensure their children have the resources they need to thrive and succeed.
How Does Child Support Work: 8-Step Formula for Calculation
According to Services Australia, there is an 8-step formula for calculating child support assessments. This is an important factor when answering the question “How does child support work?”. Here are the steps:
1. Determine each parent’s child support income
This involves calculating each parent’s adjusted taxable income, subtracting a self-support amount, and considering any relevant dependant allowances.
2. Combine both parent’s income
This step involves adding both parents’ child support income and arriving at a combined total.
3. Calculate each parent’s income percentage
This involves dividing each parent’s income by the combined total to determine their respective income percentage.
4. Determine each parent’s percentage of care
This step involves calculating the percentage of time each parent spends caring for the children. Make sure to save evidence, such as diaries, calendars, court orders, or parenting plans, to determine care percentages in case of a dispute. This is an important step in answering the question “How does child support work?”.
5. Calculate each parent’s cost percentage
This involves using the Care and Cost table to determine each parent’s cost percentage based on their care percentage.
6. Calculate each parent’s child support percentage
This involves subtracting each parent’s cost percentage from their income percentage, resulting in their child support percentage. A negative percentage indicates the parent receives child support, while a positive percentage indicates the parent pays child support.
7. Determine the costs of children
This step involves using the Costs of Children table to determine the costs for each child based on the parents’ combined income.
8. Calculate the child support amount
This involves multiplying the positive child support percentage by the costs of the child to determine the total child support payable. If both parents have positive child support percentages, the amounts are offset to arrive at the final payment amount.
How Does Child Support Work: FAQs
How long does child support last in Australia?
Child support payments generally continue until the child turns 18 years old. However, if the child is still dependent due to full-time education or a disability, financial support for them may extend beyond 18 years. This is also called adult child maintenance.
Can I change my child support assessment?
Yes, you can request a change to your child support assessment if there is a significant change in your circumstances, such as a change in income or care arrangements.
What if I cannot afford to pay child support?
You can contact the Child Support Agency to discuss payment options or a possible reassessment. You may set up a payment plan if you are unable to pay the full amount due.
What if my ex-partner refuses to pay child support?
If your ex-partner fails to make child support payments, you can contact the Child Support Agency to enforce the payments. The agency has various enforcement powers, including garnishing wages, intercepting tax refunds, or placing travel restrictions. It is also recommended to seek legal advice in case disputes arise regarding child support payments.
Do you pay child support with 50-50 custody in Australia?
If a parent has shared custody with another child he or she may need child support.
How Can We Help With Child Support Payments?
JB Solicitors has a team of family lawyers who can help with child support matters. We understand that child support is a huge responsibility as a parent. Disputes can also stem from child support payments and this may spark court proceedings if not handled properly.
However, this can all be prevented with our legal assistance. We have mediation services to help disputed parties work out a proper child support arrangement that works for everyone. Lastly, our family lawyers can ensure that your children get the proper child support payment they need.
Contact us today if you have more questions aside from “How does child support work?” and “how much child support should I pay?”
