1. The Child Support Scheme
A Broad Overview
Ken McWhinney
Senior Advisor, Technical & Quality Assurance
Child Support Agency
*This material was presented on 04/08/2010 and valid at that date

2. Child Support Scheme Before 1988 (Pre Child Support Agency)
Less than 30% of separated parents had court orders for child maintenance
Only 25% of those parents paid or received child maintenance
Court orders were for low amounts ($10-$30 per week)
Parents had problems with enforcement
Social welfare payments increased to bridge the gap
Less than 30% separated parents with court orders for maintenance
Aprox 25% of the 30% actually paid
Amounts were for as little as $10 - $30 per week
Little or no enforcement (had to go back to court)
The department of social security was paying to support children via the single parents pension
Large increase in benefits $177m to $1.7b (societal changes re family, divorce & single parents)

3. The Child Support Legislation
The Child Support (Registration and Collection) Act 1988
The objects of the Act include ensuring that:
Children receive the financial support that their parents are liable to provide.
Periodic amounts payable by parents for financial support of their children are paid on a regular and timely basis
Child support set by court order, collectable by CSA
In 1988 first Child Support Act passed. At the time it was called the Child Support Act however later became know as the Child Support Registration and Collection Act.
This Act was a result of Bob Hawke’s promise that by 1990 no Australian child would live in poverty.
This act took effect from 1 June 1988
Child support set by court order, collectable by CSA; however, orders can be quite inflexible and usually cannot take future changes to circumstances into account
CSA set up within ATO

4. The Child Support Legislation
The Child Support (Assessment) Act 1989
The objects of the Act include ensuring that:
Children receive a proper level of financial support from their parents.
That the level of financial support be determined by legislatively fixed standards
That the level of financial support be able to be determined without the need to resort to court as child support assessed (and collected) by CSA
This Act took effect from 1 October 1989.
Administrative decisions, not judicial;
Assessments set each financial year; based taxable incomes from two years prior to assessment (incomes should be available)

5. Child Support Legislative changes
The Assessment Act
Amendments included:
1992: From 1 July - administrative review, change of assessment [Part 6A].
1993: a person with at least 30% care is an eligible carer (109 nights) [ss8(3)]
1995 & 1997: amendments to the presumption of parentage provisions [ss29(2)]
1999: Objection to administrative decision provisions introduced; care based on the factual and lawful care of the child(ren); assessments can be extended to end of school in year which child turns 18 [s151B]; changes to formula assessment & child support periods provisions [s7A(2)];
2007: court application changes [s106A & s107/s143] and leave of court required for departure/CoA application for period(s) <18 months prior to application and departures limited to maximum 7 years. Stay order provisions relocated to R&C Act; Australia’s international maintenance obligation incorporated into Act
2008: Significant scheme reforms implemented (detailed in following slides)
2009: recognition of same sex couples in parentage provisions [ss29(2)]
2010: amendments to care and estimate of income provisions
From 6 April 1992
Parents can apply to CSA for a change of assessment in special circumstances for a child support year commencing on or after 1 July 1992.
In most cases, a parent cannot apply to a court for a change of assessment in special circumstances for a child support year commencing on or after 1 July 1992 unless CSA has already considered an application from one of the parents for a change of assessment.
From 1 July 1993
A person who cares for a child between 30% and 40% of the nights in a child support year is now considered to be an eligible carer, with 'substantial contact'. The other person caring for the child has 'major contact'.
Cliff effect of 109 nights, policy around cost of care does not drop for residential carer but increase for non-residential carer
From 29 May 1995
CSA can be satisfied that a person is a child's parent if one of a number of 'presumptions' apply.
CSA must refer a child support agreement to the Secretary of DSS if the payee receives more than minimum family payment or Sole Parent Pension. CSA can only accept these agreements if the Secretary decides that the agreement passes the 'reasonable action to obtain maintenance' test.
CSA must refuse to accept an agreement if the payee has not applied for a child support assessment and receives more than the minimum family payment or Sole Parent Pension.
From 22 July 1997
CSA can now be satisfied that a person is a parent of a child if:
the child is born within 44 weeks of the annulment of that person's marriage; or
the child is born after a marriage has been dissolved but within 44 weeks after a period of cohabitation by the 2 people concerned; or
the child is born to a woman who lived with the man anytime during the period beginning 44 weeks and ending 20 weeks before the child's birth.
From 1 July 1999
Payers and payees can object to CSA decisions under the Assessment Act.
Parents can now provide information and make some applications over the telephone, which CSA previously required in writing.
A liable parent can apply for a child support assessment.
A child support assessment starts from the date the application was lodged with CSA (previously backdated up to 28 days).
Child support assessments are based on both the factual and lawful daily care of the child.
A payee can apply for a child support assessment for a child in secondary education to continue to the end of the school year in which the child turns 18.
CSA can include relevant dependant children in a child support assessment from the date of notification unless the Registrar is notified within 28 days of the child becoming a relevant dependant child, or within 28 days of a notice of assessment.
Changes to the COA process
CSA can make a decision to either increase or decrease the amount of child support payable when making a decision on a change of assessment application.
CSA can initiate a change of assessment in special circumstances (this is referred to as a Registrar initiated change of assessment).
A payee can apply for a change of assessment if they incur child care costs of more than 5% of their child support income amount.
Changes to estimate provisions
Changes to the formula assessment provisions
The payee's disregarded income is based on the 'all employees average weekly earnings' figure rather than the usually higher average weekly earnings figure and extra amounts according to the age of the children for whom child support is payable were no longer added to it.
The payer's exempt income amount is increased to 110% of the unpartnered rate of social security pension.
When the liable parent has relevant dependant children, the exempt income amount is increased to 220% of the annual amount of the partnered rate of social security pension.
The minimum child support rate payable is $260 (previously zero).
CSA can reduce a $260 assessment upon application from the payer, where the person's total income in the first 12 months of a child support period is less than $260.
In calculating the amount payable in an assessment the payer's liability is reduced by 50 cents for every dollar of the carer parent's income above the disregarded income amount.
Any supplementary income (exempt foreign income, net rental losses) is added back to the liable parent's taxable income amounts. Reportable fringe benefits are included from 1 July 2000.
When the parents share care of the children of a relationship, additional amounts are added to the liable parent's exempt income for any children in their sole, major or shared care.
Changes to the assessment period and income used
Child support is assessed in child support periods rather than child support years. A child support period may last up to 15 months.
Child support assessments are based on the taxable income for the most recent taxation year rather than taxable income for the financial year before last. CSA no longer uses an inflation factor to adjust a parent's taxable income.
From 1 January 2007
A payee is able to apply directly to a court if CSA has refused their application for assessment because they were unable to satisfy CSA that the person named is a parent of the child or children.
CSA is unable to make change of assessment decisions that affect a period more than 18 months earlier than the date of the application unless the court has granted leave. If a court grants leave it can specify a period for which an assessment can be changed of up to seven years prior to the application, and may hear the application itself.
If a court grants a declaration that a person is not a parent of a child (under section 107), the court must, as soon as practicable, consider making an order for repayment of child support to the person who is not the parent of the child.
From 22 June 2007
Some changes to the secrecy provisions including the following:
CSA can communicate protected information to persons as necessary to prevent a credible threat to the life, health or welfare of a person.
CSA can communicate protected information to brief the Minister in respect of a range of circumstances relating to the Minister’s duties.
CSA can communicate protected information to a person who has the consent of the person to whom the information relates to obtain that information.
CSA can communicate protected information in specific circumstances relating to missing people and locating a relative or beneficiary of a deceased person.
A new offence for unauthorised disclosure of information.
Removal of the restriction that CSA information gathering (under section 161) in respect of third parties is limited to financial information.
Stay order provisions have been removed from the Assessment Act. All of the stay order provisions are located within the Registration and Collection Act regardless of whether the relevant proceeding has commenced under the Assessment Act or the Registration and Collection Act.
From 19 July 2007
The Assessment Act was amended to incorporate measures relating to Australia’s international obligations in relation to maintenance – these measures were previously contained in separate regulations. There were also minor amendments to the legislation as follows:
An application for assessment can only be accepted where at least one party resides in Australia. A terminating event occurs in relation to a child support assessment if both parties cease to be resident in Australia.
An application for assessment from a payee who is resident in a reciprocating jurisdiction must be made through the central authority in the country where the payee resides. The application may be initiated by the payee and given to the central authority to forward to the Registrar, or may be initiated by the central authority.
From 1 July 2009
Amendments to recognise same sex couples
the parentage provisions were amended to reflect the changes made to the Family Law Act to recognise that the members of a same sex couple may be the parents of a child, and if so, could be assessed as parents for child support.
Amendments to the definition of income used from child support purposes
the income component of ‘net rental property losses’ was replaced by a new component ‘the total net investment loss’ which includes rental property losses and net financial investment losses; and
a new income component ‘reportable superannuation contribution amounts’ is included when calculating a parent’s adjusted taxable income.
From 1 July 2010
Amendments to care provisions
CSA and the Family Assistance Office (FAO) can share care determinations where there is a child recognised in a child support assessment and a person receives Family Tax Benefit for the child. Where care determinations are shared for a child, parents and carers need to inform one agency only of any changes in care.
A new percentage of care can be determined whenever the care of a child has changed. A care period will generally be a period starting 12 months from the day on which an application for assessment is made or from the day on which the change in the actual care for a child changed (the date of event). However, the date of effect of the care change will be applied differently by the CSA and FAO.
The types of care determinations that CSA can make have changed. CSA will usually determine a percentage of care based on the actual care that each parent or carer has of the child. A written agreement, parenting plan or court order, can only be used to determine the percentage of care in limited circumstances.
Amendments to income estimate provisions
An income estimate can be made for a year of income, or part of a year of income. A year of income is the financial year, that is 1 July to 30 June.

6. Child Support Legislative changes (cont.)
The Registration & Collection Act
Amendments included:
1989: Child Support Act 1988 renamed Child Support (Registration & Collection) Act 1988
1992: CSA can issue a not to a 3rd party to collect unpaid child support [s72A]; CSA can credit non-agency payments to child support [s71A-s71D]
1999: Child support debts owed by parents to each other can be offset [s17AA]; prescribed amounts of child support collectible from Centrelink payments [s272AA]
2000: Australia to give effect to its international maintenance obligations;
2001: CSA can issue a departure prohibition order to prevent a payer leaving the country where that payer has failed to meet his or her child support obligations
2007: Stay order and objection provisions relocated to R&C Act; Australia’s international maintenance obligation incorporated into Act (previously in separate Regulations); Social Security Appeal Tribunal to provide external review process
2008: Significant scheme reforms implemented (detailed in following slides)
2009: Definition registrable maintenance liability extended to include periodic de facto maintenance orders [ss18(2)]
2010: amendments to care objection provisions
From 6 April 1992
CSA can issue a notice to a third party who holds money for a child support payer to pay that money to CSA in satisfaction of child support arrears.
The Registration and Collection Act was amended to facilitate CSA collecting child support where a payer was overseas.
CSA can credit an amount as a non-agency payment where the payer made that payment to a third party in satisfaction of a debt owed by the payer and/or payee if both parents intended it to be for child support and there are special circumstances.
A court can set aside or prevent a transaction intended to reduce or defeat a payer's ability to pay child support.
From 29 May 1995
A payer can elect for CSA not to enforce a court order during a 'low-income non-enforcement period'.
A payer and payee can jointly elect for CSA not to enforce a court order for a child who is not in the care of the payee.
A payee receiving Centrelink payments can elect for CSA not to collect their child support for them, as long as the payer has a satisfactory payment record. The payee can then make private payment arrangements with the payer.
A payee who had elected for CSA not to collect child support can later make an application for collection and ask CSA to collect up to 9 months of arrears.
From 22 July 1997
A payer can elect for CSA not to collect their child support by employer withholding.
From 1 July 1999
CSA can suspend disbursement of child support while a court considers a payer's application for a declaration that the payee was not entitled to a child support assessment.
CSA can ask Centrelink to deduct a prescribed amount for child support from a payer's Centrelink payments.
CSA can require parents to make private payment arrangements if the payer has established a satisfactory payment record and CSA is satisfied that regular payments are likely to continue.
Parents who each have child support debts can offset amounts they owe to each other.
Payers can elect to pay their child support in accordance with their pay cycle, rather than monthly.
Payees can elect to collect their own child support at any time. There is no longer a requirement for the payer to have a satisfactory payment record before a payee receiving a Centrelink payment can elect for CSA to stop collection.
Changes to crediting of non-agency payments
CSA no longer requires that there be special circumstances before it can credit payments made directly to the payee or a third party where the payer and payee intended the payments to be for child support.
CSA can credit the value of non-cash payments where the payee and payer intended the payment to be for child support.
A payer can ask CSA to credit certain payments (such as school fees, essential medical and dental fees and rent for the payee) in satisfaction of up to 25% of their monthly child support liability without the agreement of the payee.
CSA can refuse to credit a non-agency payment in the circumstances of a particular case.
From 3 May 2000
The Registration and Collection Act was amended to allow Australia to give effect to its international obligations in relation to maintenance.
From 30 June 2001
CSA can issue a departure prohibition order to prevent a payer leaving the country where that payer has persistently failed to meet his or her child support obligations.
Administrative changes to give effect to CSA's move to the Department of Family and Community Services. The Child Support Registrar is now the General Manager of CSA, rather than the Commissioner of Taxation.
From 1 July 2002
CSA can intercept a payer's Family Tax Benefit where the payer has arrears of child support.
From 4 May 2006
CSA customers can appeal against CSA making a departure prohibition order in the Federal Magistrates Court.
From 1 July 2006
The rate at which CSA can credit a prescribed non-Agency payment increases from 25% of the monthly child support liability to 30%.
From 1 January 2007
The Social Security Appeals Tribunal provides a process for parents who want a review of a CSA decision made under the Assessment Act or the Registration and Collection Act.
A payee can pursue court enforcement of a debt whilst it is registered for collection by CSA.
A court hearing an enforcement application made by a payee has the same powers as CSA to obtain information in order to collect child support.
A court has increased powers to make orders staying a child support assessment or collection pending the determination of an objection, application for review, or appeal to a court.
CSA can register for collection an amount repayable by a former payee to a former payer under a parentage overpayment order.
From 22 June 2007
All stay order provisions are located within the Registration and Collection Act regardless of whether the relevant proceeding has commenced under the Assessment Act or the Registration and Collection Act.
Some minor changes to Social Security Appeals Tribunal (SSAT) arrangements – including provision for an applicant to withdraw their SSAT application.
Objections and accompanying documents to be sent to the other party.
Where a court orders a payer to make a payment in private payee enforcement proceedings that payment must be made to CSA.
An employer’s obligation to withhold money from a payer’s salary and wages is extended to include payments to independent contractors.
Some changes to the secrecy provisions including the following:
CSA can communicate protected information to persons as necessary to prevent a credible threat to the life, health or welfare of a person.
CSA can communicate protected information to brief the Minister in respect of a range of circumstances relating to the Minister’s duties.
CSA can communicate protected information to a person who has the consent of the person to whom the information relates to obtain that information.
CSA can communicate protected information in specific circumstances relating to missing people and locating a relative or beneficiary of a deceased person.
A new offence for unauthorised disclosure of information.
From 19 July 2007
The Registration and Collection Act was amended to incorporate measures relating to Australia’s international obligations in relation to maintenance – these measures were previously contained in separate regulations. There were also minor amendments to the legislation as follows:
A maintenance liability cannot be registered under the Registration and Collection Act unless one party resides in Australia.
One registered maintenance liability will cease to have effect if a second maintenance liability is registered in relation to the same child, payee and payer. The Registrar is able to refuse to accept an application for an Australian child support assessment that would override an overseas liability already registered.
A payer is able to apply for registration of a maintenance liability provided that either the payer or the payee resides overseas in a reciprocating jurisdiction.
There are some increased time allowances in relation to various processes where one party to a maintenance liability is resident in a reciprocating jurisdiction. Generally these increased time allowances apply only to the party who is resident in the reciprocating jurisdiction.
A person who has a liability to pay child support to the Registrar because of an overseas maintenance liability is able to apply for non-enforcement of the liability during a period of low income.
From 1 January 2008
CSA can issue a notice to someone who owes a child support debtor money requiring that the money be paid to CSA in satisfaction of child support related debts (section 72A notice) for less than the total amount of outstanding child support.
CSA is not required to serve a copy of the objection and accompanying documents on the other parent where the objection is to the making of, or refusal to make, a departure determination under Part 6A if CSA is satisfied that the rights of the other parent will not be affected by any decision made by the CSA.
Parents can apply for an extension of time to submit an objection over the phone as well as in writing.
Payers can object to the acceptance of their application for a child support assessment.
Range of debts collectable via tax refund intercepts is extended.
10 December 2008
The Departure Prohibition Order provisions are extended to allow CSA to issue a DPO to prevent a person from leaving Australia if the person owes child support in another country and the liability and any arrears have been registered with CSA.
Selected SSAT decisions about child support matters may be published. All identifying information will first be removed.
From 1 March 2009
The definition of registrable maintenance liability at section 18 is extended to include a liability of a party to a de facto relationship to pay periodic maintenance to the other party of the de facto relationship.
From 1 July 2010
The way that care percentage decisions are reviewed has changed as a result of CSA and the Family Assistance Office (FAO) sharing care decisions. A party to an assessment can object to CSA or the FAO for review of a care percentage decision. The objection to the care decision can be made either orally or in writing. A party may object to the care decision any time, however the date of effect of the objection care decision will vary depending on whether the objection was lodged within, or outside, the 28 days from the date of the original care decision (90 days for a person in a reciprocating jurisdiction).
A party to an assessment who is dissatisfied with CSA’s or FAO’s objection care percentage decision can apply to the SSAT for review of the decision, at any time.
A parent can object to CSA’s decision to refuse to accept an election for a new year

7. The New Child Support Scheme
1 July 2008
In response to the House of Representatives Committee on Family and Community Affairs report Every Picture Tells a Story, December 2003.
The Government commissioned a Taskforce review on Child Support, chaired by Professor Patrick Parkinson
Taskforce found child support scheme needed to be updated
In February 2006 Government announced acceptance of the report.
New system is more focused on the needs and costs of children

8. The Child Support Formula
The formula is based on three principles:
the cost of a child
an income shares approach
care is a contribution towards meeting the costs of a child.
Cost of a Child
Based on Australian research which involved statistics of what Australian parents are actually spending on their children.
The Costs depend on the age and number of children, as well as the combined child support incomes for both parents.
A Table is used to calculate these costs and is called the Cost of children table.
Income Shares Approach
The parents share of the combined income available to support the children and indicates the share of the cost of the children each parent is responsible for meeting. Treats both parents income in exactly the same way.
Care is a contribution
The care contribution reflects the care a parent provides directly to the child and is a contribution towards the costs of the child.
This contribution is expressed:
as a percentage;
using the actual care a parent has and is
calculated using the cost % table.
It’s important to note that care doesn’t always translate directly from the % of care a parent has to the % contribution to costs of child as you will see when you look at the cost % table.

9. Eight steps to the formula
Child Support Income
Combined Child Support Income
Income Percentage
Percentage of Care
Cost Percentage
Child Support Percentage
Costs of the Children
Annual rate of Child support transferable

10. Child Support Income (Adjusted Taxable Income)
From 1 July 2009, a parent’s Adjusted Taxable Income is
the total of the following components (section 43(1)):
taxable income
reportable fringe benefits
target foreign income
the total of tax free pensions or benefits
reportable superannuation contributions
the parent’s total net investment loss
Reportable fringe benefits
the amount of reportable fringe benefits as defined in the Fringe Benefits Tax Assessment Act 1986 for the year of income (section 5).
Target foreign income
• the amount of the parent’s foreign income as defined in section 10A of the Social Security Act 1991 that is neither taxable income nor received as a fringe benefit as defined by the Fringe Benefits Tax Assessment Act 1986; and
• any other amount of the parent's income that is exempt from tax under sections 23AF and 23AG of the Income Tax Assessment Act 1936, less the amount of losses and outgoings incurred (section 5B FBTA Act).
Tax free pensions or benefits
The following tax free pensions or benefits are included in the adjusted taxable income:
• a disability support pension under the Social Security Act 1991;
• a wife pension under the Social Security Act 1991;
• a carer payment under the Social Security Act 1991;
• an invalidity service pension under the Veterans’ Entitlements Act 1986;
• a partner service pension under the Veterans’ Entitlements Act 1986;
• income support supplement under the Veterans’ Entitlements Act 1986;
• Defence Force Income Support Allowance under the Veterans’ Entitlements Act 1986;
but only the amount that is:
• exempt from income tax; and
• not a bereavement payment, pharmaceutical allowance, rent assistance, language, literacy and numeracy supplement or remote area allowance.
Reportable superannuation contributions
From the 2009/2010 financial year, a parent's reportable superannuation
contributions will be included in the calculation of their adjusted taxable income.
The amount included is the total of reportable superannuation contributions as
defined in the Income Tax Assessment Act 1997 for the year of income. This
includes the parent's reportable employer superannuation contributions (if any) for
the income year; and the individual's deductions (if any) under Subdivision 290 C.
Net financial investment loss
The amount by which the parent’s expenses for the investments, e.g. from rental
property, shares, managed investment and forestry managed investment schemes,
exceed the gross income from them (section 5), if this loss was deducted from the
parent’s income for tax purposes.

11. Child Support Income Estimates of Income
If a customer’s income drops significantly (more than 15%) they can elect to use an estimate of their expected income for a financial year, or part of a financial year.
The estimate must be the total of all income component amounts of the parent’s adjusted taxable income for the year.
The assessment will be recalculated based on the estimated adjusted taxable income.
The estimate will be checked against the real adjusted taxable income.
An income estimate can be made if:
if there is no income amount order in force on the start day of the election or in the remainder of the financial year (sections 60(6) and 63(2A)); and
in the case of a first election for a year of income – if the estimate is 85% or less than the person’s adjusted taxable income for the last relevant year of income (section 60(1)(b)). The adjusted taxable income is based on the parent’s taxable income
later income estimate elections for a year of income can be made at any time within that year of income, and the amount estimated may be higher or lower than the previous estimate (section 62A).
Cannot lodge an estimate if the child support period is based on an agreement, a determination made under the CSA Change Of Assessment process or a decision made by a court where an Income Amount Order is made.
CSA has the authority to refuse to accept an estimate, review an estimate and/or reconcile an estimate.

12. Percentage of Care Actual Care
Under the child support formula, care is considered a contribution towards the costs of a child.
Parents with regular (14%) or more care are acknowledged as directly meeting some of the costs of their children through care.
A percentage of care is generally calculated on the actual care a parent or non-parent carer is likely to provide for the child in the relevant care period.
The care percentage is determined over a care period.
From 1 July 2010, a care period is generally a 12 month period from:
the day on which an application for assessment is made; or
the day on which the change in the actual care for a child changed (the date of event).

13. Percentage of Care Interim Determinations
In limited circumstances a percentage of care may be determined in line with a written agreement, parenting plan, or court order for an interim period (14 weeks) even though the parent is not having the agreed care, but where they wish to, and are taking reasonable action to have such care.
An interim care determination may also be made in circumstances where a parent is not seeking the care as set out in the agreement, plan or order, but will be seeking a new agreement, plan or order for a new lower amount of care due to special circumstances.
Interim determinations may be extended up to 26 weeks where there are special circumstances on the facts of the case
When can an interim determination be made?
From 1 July 2010, an interim determination can be made where one of the following sets out the care for the child:
A written agreement between the parents of the child, or between a parent of the child and another person who cares for the child, that relates to the care of the child, or
A parenting plan for the child; or
Any of the following orders relating to the child:
A family violence order within the meaning of Section 4 of the Family Law Act 1975,
a parenting order within the meaning of section 64B of that Act,
a state child order registered in accordance with section 70D of that Act,
an overseas child order registered in accordance with section 70G of that Act.
and
care of the child is not happening in accordance with that agreement, plan or order, and the change from the agreed, planned or ordered care has occurred within 14 weeks prior to the request for the determination (or within a longer period, in special circumstances)(section 53 of the amended Act); and
the parent or carer who has less care than set out in the agreement, plan or order is taking reasonable action to:
re-instate care as per the agreement, plan or order (section 51 of the amended Act); or
seek a new agreement, plan or order, and there are special circumstances (section 52 of the amended Act).
Reasonable action to have care in accordance with an agreement, plan, or order
Examples of reasonable action to have care in accordance with an agreement, plan or order may include:
initiating court action for contravention of a court order,
initiating mediation, through a Family Relationship Centre or other service, to re-establish the care arrangement,
negotiating with the other parent with a view to re-establishing the care arrangement.
This list is not exhaustive.
Reasonable action to seek a new agreement, plan, or order
Where there are special circumstances, a parent or carer may seek a new agreement, plan or order for a lesser amount of care than they are to have under the current agreement, plan or order but for a greater amount of care than they are actually having.
“Special circumstances” indicates something out of the ordinary and may include situations where the parent could not continue to have the previous level of care:
due to serious medical problems relating the child or themselves,
because the other parent has moved a substantial distance away from their previous home without making arrangements with the other parent about the care arrangements for the child,
because of the involvement of a child protection agency.
26 week extension -In special circumstances, the interim period may be extended to up to 26 weeks. For example, a parent may have travelled overseas with a child without the consent of the other parent, resulting in delays in mediation and/or court action. Normal delays associated with mediation or the court process will not generally be considered to constitute special circumstances unless there are other factors that make the case unusual.

14. Percentage of Care
A customer must have a care percentage of at least 35% (128 nights) to receive child support
A care percentage of less than 14% (52 nights) does not effect the child support assessment
A parent will not be assessed to pay child support if they have more than 65% care

15. Care Percentage Range Nights Percentage of Care Below regular
0%-13%
Regular
nights
14%-34%
Shared
128 – 237 nights
35%-65%
Primary Care
238 – 313 nights
66%-86%
Above Primary
87%-100%
0 – 14% = less than regular care
14 – 35% = regular care
35% - 65% = shared care
More than 65% = primary care

16. Cost percentage Percentage of Care Cost percentage
The cost percentage is determined by applying the percentage of care a parent has of a child, to the cost percentage table.
Percentage of Care Cost percentage
0 to less than 14% Nil
14% to less than 35% 24%
35% to less than 48% 25% plus 2% for each percentage point over 35%
48% to 52% 50%
more than 52% to 65% 51% plus 2% for each percentage over 53%
more than 65% to 86% 76%
more than 86% to 100% 100%
Discuss how this will even out cliff effects
i.e. by reflecting each care percentage on a sliding scale of cost percentages the effect on child support is smoothed out, small changes in care arrangements don’t have as much possibility of making a large change to child support payable.
-between 35 % of care and 64% of care you can see a smooth curve with cliff effects still evident between 13% and 14% and at the opposite end of the spectrum 86 and 87% of care
Discuss how the Cost % will be different for different children and this is why the formula calculation is designed to be carried out per child and the cost of child is arrived at per child

17. Parents Combined Child Support Income
Cost of Children Table
Parents Combined Child Support Income
No of children
$0-
$25324
$25325
-$50648
$50649-$75972
$75973-$101296
$ $126620
Over $126620
Costs of Children
Children aged 0-12 years
1 child
17c for
each $1
$4305 plus 15c for each $1 over $25324
$8104 plus 12c for each $1 over $50648
$11143 plus 10c for each $1 over $75972
$13675 plus 7c for each $1 over $101296
$15448
2 children
24c for
$6078 plus 23c for each $1 over $25324
$11902 plus 20c for each $1 over $50648
$16967 plus 18c for each $1 over $75972
$21525 plus $10c for each $1 over $101296
$24058
3+ children
27c for
$6837 plus 26c for each $1 over $25324
$13422 plus 25c for each $1 over $50648
$19753 plus 24c for each $1 over $75972
$25830 plus $18c for each $1 over $101296
$30389
Children aged 13+
23c for
$5825 plus 22c for each $1 over $25324
$11396 plus 12c for each $1 over $50648
$14435 plus 10c for each $1 over $75972
$16967 plus $9c for each $1 over $101296
$19246
29c for
$7344 plus 28c for each $1 over $25324
$14435 plus 25c for each $1 over $50648
$20766 plus 20c for each $1 over $75972
$25830 plus 13c for each $1 over $101296
$29123
32c for
$8104 plus 31c for each $1 over $25324
$15964 plus 30c for each $1 over $50648
$23551 plus 29c for each $1 over $75972
$30895 plus 20c for each $1 over $101296
$35960
Children of mixed age
26.5c for each $1
$6711 plus 25.5c for each $1 over 25324
$13168 plus 22.5c for each $1 over $50648
$18866 plus $19c for each $1 over $75972
$23678 plus 11.5c for each $1 over $101296
$26590
29.5c for each $1
$7471 plus 28.5c for each $1 over 25324
$14688 plus 27.5c for each $1 over $50648
$21652 plus 26.5c for each $1 over $75972
$28363 plus 19c for each $1 over $101296
$33174
The Costs of Children Table
This is “mathematical” representation of above lines, taking into account self-support amounts
Works like a tax table
Dollar figure in each box is just cents in previous box(es) applied to $25,324
Costs are capped, not income (except COA)
When calculating child support round to whole dollars
Divide by the number of children – need a cost per child
Capped at 3 children

18. Basic Formula Calculation
Cost of a Child
$10,000
The new child support formula calculates the cost of each child for the purposes of child support.
The formula prescribes how cost is met.
This simple example applies the concepts of how the parents share in meeting the costs of a Child.
In this example we have used the same incomes for the parents and a cost of child of $10,000.
Combined income of $63,398

19. Basic Formula Calculation
Cost of a Child
$ 5000
$ 5000
The responsibility for meeting the cost of a child is based on the share of the available income each parent has.
Both parents have the same income - therefore, based on the ‘income shares approach’
each parent is required to meet 50% of the costs of the child i.e., $5000 each.

20. Parent 1 meets 24% of costs through care ($2,400)
Parents also meet the cost of a child directly through care.
In this example, using the cost % table, parent 1 is meeting 24% (1 night a week or 52 nights in 12 months) of the costs of the child through care or $2,400.(24% of $10,000)
Parent 2 is meeting 76% of the costs of the child through care (313 nights in 12 months). or $7,600 (76% of $10,000)

21. Parent 1
must meet 50% ($5,000) of the costs, they meet 24% ($2,400) through care and need to transfer 26% ($2,600)
Parent 2
must meet 50% ($5,000) of the costs, they meet 76% ($7,600) through care and need to receive 26% ($2,600)
26% or $2,600
50% or $5,000
24% or $2,400
So remember that 100% of the costs of a child must be met.
Parent 1 is responsible for meeting 50% of the cost of the child based on their share of the income.
Parent 1 is meeting 24% of the costs of the child directly through care. 50% - 24% = 26%, therefore they must meet a further 26% of the cost of the child 26% of $10,000 = $2,600.
Parent 2 is responsible for meeting 50% of the cost of the child based on their share of the income. Parent 2 is meeting 76% of the costs of the child directly through care. Therefore they must receive 26% (50% - 76% = -26%) or $2,600 (26% of $10,000) as they are meeting 26% more than required.
Therefore, the parent who is meeting less of the costs than their share of the income, is required to transfer child support to the other parent.

22. Child Support Agreements
There are two types of Child Support Agreements:
Limited Agreements (S80E,F&G - Assessment Act)
Binding Agreements (s80C,CA&D - Assessment Act)
- including lump sum payments provisions (s84(1)(e)&(7))
Most pre 1 July 2008 Agreements transitioned to the new scheme and are deemed to be Binding Agreements
Binding & Limited Agreements must meet the general requirements for a child support agreement (s84(1) - Assessment Act)
S 84(1)
Set periodic amounts
vary periodic amounts
Matter that maybe included in departure orders
non-periodic child support
Lump sum payment
not non-periodic or lump sum
end date of child support

23. Limited agreements Do not require legal advice.
There must be an assessment already in place.
Amount payable under the agreement must be equal to or greater than the child support assessed by the formula (s80E(3)(b)).
Cannot be varied but can be ended by a new limited or binding agreement or a court order.
Can be terminated on the request of one party after three years (s80G) or,
If notional assessment has varied by a change of more than 15% in the annual rate (when compared to previous notional assessment) that has not been accounted for in the agreement.
The election to end must be made within 60 days of receipt of the new notional assessment.
Limited
Do not require legal advice. Can not be an initiating document.
Must be for an amount equal to or greater than the administrative assessment (s80E(3)(b)).
Can be terminated: (s80G) by another limited or binding agreement or by a court order;
an election by either party, in writing, after 3 years
the written election of either party if the notional assessment is varied by more than 15% from the previous notional assessment & the variation is not contemplated by the agreement;

24. Binding agreements
Formal agreement, in writing and signed by both parents.
Requires a certificate from both parent’s lawyers stating they have been provided with independent legal advice (s80C(2)(c)&(d)).
Can be made for any amount that both parents agree is appropriate.
Can only be ended by a new binding agreement (to terminate or replace) or a court order (s80D(1)).
In order to replace an existing binding agreement with a new binding agreement, the new agreement must include a provision to the effect that the earlier agreement is terminated (s80D(1)(a)).
BINDING
Can be an initiating document.
Must contain a statement of independent legal advice (s80C(2)(c)&(d)).
Can be for any amount.
Can only be terminated by another binding agreement or by a court (s80D(1))

25. Notional Assessments s146A-146L - Assessment Act
When CSA accepts a Limited or Binding Agreement, CSA will make a Notional Assessment (preceded by a Provisional Notional Assessment)
A Notional Assessment is the assessment that would have been in place but for the Agreement
Notional Assessments are transmitted to Centrelink to determine entitlement to Family Tax Benefit
Notional Assessment
CSA’s calculation of the amount that would be payable under a formula assessment if the agreement was not in place & is used by Centrelink to work out the amount of Family Tax Benefit Part A payable.

26. Notional Assessments (cont)
For Binding – made once every three years
For Limited – made once every three years or upon request
Will generate whenever the rate under an agreement varies by more than 15% (this does not trigger an option to end if the change is in a manner contemplated by the agreement)
Not made for transitional or lump sum binding agreements
Updated every 3 years, or at the request or either party or if the amount payable under the agreement changes by more than 15%.
Takes into account changes in a parties circumstances, for example:
changes in care; estimates of income; change of assessment process.
Do not apply to lump sum binding agreements or transitional agreements

27. Agreements - lump sum crediting provisions
lump sum must be equal to or greater than the annual child support rate under the assessment.
if the lump sum is greater the difference will be used as credit for future child support payments.
parents will be able to nominate a percentage, or all, or the upcoming child support payments that are to be met using the credit.
the lump sum amount will be reduced at the end of each financial year according to the liability met under the agreement for that year.
any remaining amount will be adjusted by the consumer price index annually.
Family Tax Benefit will be based on the assessment amount. 27

28. Application to Accept Agreement
If the application for acceptance of the agreement is made to CSA within 28 days after the agreement was signed then the assessment is amended in accordance with the terms of the agreement
If the application for acceptance of the agreement is not made to CSA within 28 days after the agreement was signed then the assessment is amended from the date the application was made to the CSA.

29. Setting Aside Agreements Part 7 Division 6 - Assessment Act
A court with jurisdiction can set aside a limited or binding agreement under section 136 of the Assessment Act in the following circumstances:
Fraud, failure to disclose material information
Undue influence or unconscionable conduct
Note: former section 98 repealed from 1/7/2008. All setting aside provisions contained within section 136.
BINDING & LIMITED AGREEMENTS - Court can set aside if satisfied:
obtained by fraud or a failure to disclose material information;
a party to or someone acting for a party to the agreement exerted undue influence, duress or engaged in unconscionable conduct to such an extent it would be unjust not to set aside the agreement;

30. Setting Aside Agreements (cont)
Limited Agreement
Significant change in circumstances such that it would be unjust not to set aside, or
Agreement provides for an annual rate that is not proper or adequate.
Binding Agreement
Exceptional circumstances that have arisen since the agreement was made and the applicant or the child will suffer hardship if the agreement is not set aside.
LIMITED AGREEMENTS – can set aside if court satisfied:
there has been a significant change in circumstances that it would be unjust not to set the agreement aside;
agreement provides for an annual rate of CS that’s not proper or adequate considering all the circumstances of the case.
BINDING AGREEMENTS - can be set aside if court satisfied:
exceptional circumstances have arisen since the agreement was made, resulting in hardship to the applicant or child if the agreement is not set aside.

31. What is Change of Assessment?
An administrative process which enables special circumstances to be reflected in the child support assessment
There are 10 reasons
Either parent can make an application or the registrar can initiate the process
Departure decisions cannot reduce the assessment below the minimum rate ($360)
Decisions cannot change the assessment for a period more than 18 months before the applications was made
Application, any response or other documents are exchanged between parents.
SCO’s
written application & response
consider information provided by parties – docs/verbal
- conferences + additional info obtained by CSA
Different components of the formula calculation can be changed ,ie vary the annual rate payable by an amount or % income not reflective or special circumstances eg. cost of schooling medical costs.
Change in the cost of child

32. Determining a COA Application
In considering a change to the child support assessment Senior Case Officers are required to determine (section 117):
that there is a reason to make a change to the assessment, there are ‘special circumstances
that a change to the assessment would be ‘just and equitable’ or fair to the children and both parents
that changing the assessment would be ‘otherwise proper’ or fair to the community.

33. Review of CSA decisions
Internal Review - Objections
(Part VII of the CSR&CA)
Decisions under both Acts listed at s80
Apply in writing within 28 days of notice of decision (*different process for care objections)
Stating fully & in details the grounds relied upon
60 days for decision – allow or disallow
External Review - SSAT
(Part VIIA of the CSR&CA)
Review of CSA objection decisions, or refusal to grant extension of time to object
*Note new unique review process for Care – see Recent Development slide (no 49)

34. Common Court Applications
A copy of all applications under the CSAA or the CS(R&C)A must be served on the Registrar (Rule 4.23(1)(b), Family Law Rules 2004).
Departure from assessment – after a ‘too complex’ CoA decision, or there must be another matter before the court (s116 CSAA)
Amend assessment more than 18 months old- apply for leave to amend assessment up to 7 years from date of application (s111 CSAA)
Discharge or vary agreement – applicant can go straight to court (s136 CSAA)
Substitution order – order that child support be paid in a form other than periodic amounts (s124 CSAA)
Stay Order – an application can be made if there are court proceedings on foot, a change of assessment application or objection is being considered by CSA or the SSAT is considering an application for review (s 111C CS(R&C)A)
Appeal SSAT decision - Must be on a point of law (Subdivision B of Division 3 of Part VIII CS(R&C)A)

35. Common orders Section 106A Court Declarations
Application for assessment is refused, often as there is no proof that the named liable parent is a parent of the child.
Must apply to court under section 106A of CSAA
Assessment commences from date of original application
Section 107 Court Declarations
Payer believes they are not a parent of the child
Apply under section 107 of the CSAA
Payments held in trust whilst liable parent seeks a section 107 court declaration (s79A R&C Act). CSA still collects but does not pass on payments to the carer parent
Payments already paid will not be refunded by the CSA. After making a 107 declaration the court will consider making a section 143 (CSAA) order for recovery of child support from the carer parent which can be registered for CSA collection.

36. Child Support Enforcement
Information Gathering (s120 R&C Act)
Collection from Third Parties (s72A R&C Act)
Tax Refund Intercepts (s72 R&C Act)
Departure Prohibition Orders (s72D R&C Act)
Debt enforcement Litigation (s113 R&C Act)
financial institutions – banks, building societies; Real Estate Agents; solicitors trust accounts;
Accountants, Telstra, Optus, leases,
NO FISHING – citation Westpac v DCT

37. The effect of the Same-sex Legislation Reforms on the Child Support Agency
Two new Acts introduced:
Same-Sex Relationships (Equal Treatment in Commonwealth Laws - General Law Reform) Act 2008.
Family Law Amendment (De Facto Financial Matters and Other Measures) Act 2008.
These two new Acts have made changes to the Family Law Act 1975 and child support legislation.
In 2007 a Human Rights Equal Opportunity Commission report into the discrimination against people in same-sex relationships resulted in the amendment of 68 Commonwealth laws to remove discrimination against same-sex couples and the children of same-sex relationships. 37

38. Child Support amendments
Prior to 1 July 2009, Child Support legislation did not provide for same-sex couples to seek child support in the same manner as opposite-sex couples. The non-biological parent not recognised as a parent.
From 1 July 2009, application for assessment can be accepted based on relevant evidence of parentage.

39. Betty and Sue have a son. Betty and Sue’s relationship ended in early 2006.
Before July After
On 10 February 2006 Sue applied for child support and a case was registered as a non-parent case.
On 26 November 2009 Betty applies to have Sue assessed as a parent.
Before 1 July 2009 under Formula 5, Sue would be a non-parent carer, her income would not be used in calculating the child support income amount.
After 1 July 2009 Sue would be recognised as a parent*. Sue’s income would be included in calculating the child support income amount using Formula 1.
*Note - The application will be decided on the available evidence of parentage.

40. Definition of a parent
Under Section 5 of the Child Support (Assessment) Act 1989, a person who is not the biological parent of the child is still a parent of that child for child support purposes if the person is:
an adoptive parent; or
if the child was born as the result of an artificial conception procedure, a parent of the child under section 60H of the Family Law Act; or
if the child was born because of a surrogacy arrangement, a parent of the child under section 60HB of the Family Law Act.
From 1 July 2009 a separated same-sex couple is able to apply for child support as parents if they are recognised as parents under either section 60H or section 60HB of the Family Law Act 1975 (Family Law Act).

41. Evidence of Parentage
Section 29(2) of the Child Support (Assessment) Act 1989 sets out when the Registrar is to be satisfied that a person is a parent of a child (presumptions of parentage). Some changes have been made to section 29 to accommodate the changes to the definition of “parent”.
Documents that evidence that a person is a parent of a child include:
a signed statutory declaration that declares that they are “a parent” of a child (there is no longer a requirement for the person to declare that they are “the father or mother” of the child);
a court declaration that a person is a parent of a child;
evidence that the person is a parent for the purposes of section 60H of the Family Law Act;
a surrogacy parentage order made under prescribed State or Territory legislation;
a birth certificate naming the person as a parent.

42. Assisted Conception
Section 60H defines who is a parent of a child born as a result of an assisted conception procedure. Under section 60H of the Family Law Act 1975, a child is recognised as a child of the birth mother and her partner where:
the child is born as the result of an assisted conception procedure, and
the birth mother and her partner were married or in a de facto relationship at the time, and
both the birth mother and her partner consented to the procedure at the time of conception.
An assisted conception procedure includes:
a child conceived through IVF;
donor insemination; and
home insemination.

43. Surrogacy
Under section 60HB individuals or couples (same-sex and opposite sex couples) who become parents via a surrogacy arrangement will be recognised as the parents for child support and family law purposes where a surrogacy parentage order has been issued under prescribed State or Territory legislation.
Under Section 60HB if a court has made an order under a prescribed State or Territory law that:
(a) a child is the child of one or more persons; or
(b) each of one or more persons is a parent of a child;
then, for the purposes of this Act, the child is the child of each of those persons.

44. Adoption
People in a same-sex relationship can also be recognised as parents of a child when they have adopted that child. This includes where one parent is the biological parent and the other parent adopts the child, or where both parents adopt the child together in Australia or overseas.

45. Same-sex Child Support cases
Scenario1: Assisted conception
Nicole and Samantha
Nicole and Samantha are in a de facto relationship and decide to have a child together. They agree that Nicole will be the birth mother, and Nicole self-inseminates at home using donor sperm. Their daughter Louisa is born. Sometime after this, Nicole and Samantha’s relationship ends and Nicole agrees to have full time care of Louisa.
Nicole goes to Centrelink to apply for the Family Tax Benefit (FTB) and is told that she must first contact the CSA to apply for child support in order to ensure that she is taking reasonable maintenance action.
The CSA works out that Samantha is liable to pay child support to Nicole as both mothers are recognised as legal parents under section 60H of the Family Law Act 1975.

46. Scenario 2: Surrogacy Michael and John
Michael and John live in the Australian Capital Territory and are in a de facto relationship. They agree to have a child together through surrogacy with the assistance of a surrogate mother. After Sam is born, with the consent of the surrogate mother, they apply to the ACT Supreme Court and have a parentage order made naming them both as parents of Sam. Some time after this, their relationship deteriorates and Michael agrees to have full time care of Sam.
The CSA works out that John is liable to pay child support to Michael as they have a surrogacy parentage order issued under a recognised State or Territory Scheme which says that they are both parents. This satisfies section 60HB of the Family Law Act.
Note: Only the ACT and WA currently have a surrogacy parentage scheme recognised under the Family Law Act.

47. Scenario 3: Adoption Patrick and David
Patrick and David live in Perth and have been in a relationship for the past eight years. Three years ago they adopted a four year old child, Chris.
Patrick and David’s relationship breaks down and David takes full time care of Chris.
Patrick and David apply to the CSA for a child support assessment. As David has the majority of care Patrick is deemed to be the paying parent. They decide to pay their child support privately.
Note: This scenario is not affected by a change in the same sex legislation, Patrick and David would always have been recognised as adoptive parents.

48. Recent developments - 1 July 2010 Estimates
Post 1 July 2010 the estimate process has been aligned to financial years to make the calculation simpler for parents
This alignment to financial years also allows CSA to more easily reconcile Adjusted Taxable Incomes for parents who have estimated their income.
Child Support and Family Assistance Legislation Amendment (Budget and Other Measures) Bill 2010
The objectives of the Income Estimates Long Term Solution are to:
Address deficiencies with current processes and correct unintended consequences from legislative change to the Assessment Act in 1999
Introduce a simplified estimate process aligned to financial years, while maintaining the existing 15 month child support period which is working successfully
Provide benefits to parents through simplified processes and more responsive reconciliation of estimates
Increase the accuracy of assessments which means that children will receive an appropriate level of financial support from their parents in a more timely manner, and
Provide more efficient service delivery arrangements for relevant agencies.
The key changes to the current income estimation process are:
Income estimates will be aligned to financial years. This will allow the CSP to more easily reconcile Adjusted Taxable Incomes (ATI) for parents who have estimated their income.
A parent may estimate their income for a financial year (before the year starts or on the first day of the year) or for part of the financial year.
When a parent lodges an estimate of income for part of a financial year they will be asked to provide an estimate of their year to date ATI and an estimate of their expected ATI for the remaining part of the financial year.
When the parent lodges their tax return, the estimated ATI will be compared to the actual ATI through an automated Cuba process. When relevant, Cuba will use the parent’s year to date ATI to calculate their actual ATI for the estimate period.
Where the actual ATI amount is lower than or equal to the estimated amount the estimate is recorded as accurate and no further action is taken.
Where the actual ATI amount is higher than the estimated amount, the assessment is amended for the estimate period based on the (higher) actual ATI.
CSP will be able to manually calculate a parent’s income and reconcile their estimate if they do not lodge a tax return.

49. Recent developments - 1 July 2010 Care Alignment
Post 1 July 2010 there is a single determination of care for both child support and family assistance purposes.
A care determination made in respect of a child will be made by one agency (i.e. either CSA of FAO) and then used by both agencies for child support and FTB purposes.
CSA & FAO use the same rules to determine a customer’s care percentage.
The alignment of care rules mean that customers only have to inform one agency of a change in care arrangements.
Where either agency conducts an internal review of a care decision, any new decision made on review will also be used by the other agency.
Objections to care decisions can now be made orally or in writing and a person can object at any time. However, if the objection is lodged more than 28 days after notification of the decision then the date of effect is the date the objection was lodged.
Child Support and Family Assistance Legislation Amendment (Budget and Other Measures) Bill 2010
The objectives of the Alignment of Care measure are to:
allow one care determination to be used for both child support and family assistance purposes
remove duplication of effort between the CSP and FAO
have consistent decisions about the percentage of care separated parents have of their children
simplify service delivery process as the care determination will be made once by one agency and the one care percentage will be used by both agencies, and
reduce objections and appeals for both agencies.

50. CSA Website WWW.CSA.GOV.AU

51. Questions? Further Information – Contact CSA 131 272 or www.csa.gov.au
The Guide – CSA’s online Guide to the administration of the Child Support scheme
The Legal Practitioner’s Guide - Precedents for child support agreements and court orders
Solicitors’ Hotline Australian cases
International cases
FaHCSIA:
Task force reports and research papers