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What is child support?
Both parents have a financial responsibility to their child until the child turns eighteen years of age to feed, shelter, clothe, educate and pay for medical costs, amongst other expenses that a child requires. This responsibility exists even after parents have separated, even if the child does not live with that parent.
Child support is an amount of money that a separated parent pays to the other parent to contribute to the costs of raising a child. There are three ways that child support can be managed in Australia:
What is private collection of child support?
This arrangement involves either the Child Support Agency (which assesses using calculators how much child support is to be paid) or a Family Court order or an agreement between the parents. This arrangement sets out payments, and the parents arrange the most practical way for the child support payments to be made. This allows the parents flexibility with the arrangements, allowing them to speak directly with one another. For example, the parents could agree that the payments are made “in kind” to third parties to cover schooling expenses, camp fees, extra-curricular activities, or medical costs. If a parent falls behind with the payments, then the Child Support Agency can assist. Where the parents are able to effectively communicate and negotiate with each other, this arrangement may be most suited.
What is Child Support Collection?
Through Child Support Collection, the Child Support Agency mandates the amount of child support that is required and organises collection and transfer of the payments between the parents. No direct communication between the parents is required, enforcement action can be taken, and accurate records will be maintained. However, there is no guarantee as to how long it will take before payments are received if the paying parent does not make payments on time and enforcement action is required. This arrangement is most suitable where parents cannot communicate effectively with one another, or where payments have not been made regularly or in full.
What is self-management of child support?
This arrangement is entirely independent of the Child Support Agency, so that the parents have complete control to reach agreement between themselves about the amount, frequency and method of payment of child support. This is most beneficial to parents who can effectively communicate with one another in the parenting of their child. The parents can switch to another method of collection at any time if self management is not proving successful.
How can we work out what is fair for child support?
If the parents are proceeding with self-management for child support, then one important issue will be how much child support is fair. Whilst the Child Support Agency calculators may be useful, often they do not provide for additional expenses such as a private school education or large medical costs. In such a case, the parents will need to negotiate between themselves as to what is fair and reasonable in their circumstances.
Mediation is hugely beneficial in this scenario, as we provide the forum and support to you to discuss and reach agreement as to child support in an appropriate environment, without any monetary disagreements from property settlement coming into the equation. If agreement is not reached at mediation, then you can always use another collection method through the Child Support Agency. However, where you and your ex-partner reach agreement at mediation, then the agreement needs to be recorded, and we can assist you with this.
Can we formalise the Child Support Agreement?
There are two ways that a private Child Support Agreement can be finalised:
What is a Limited Child Support Agreement?
A Limited Child Support Agreement can include monetary payments or other payments such as private school fees or private health insurance. Although the Limited Child Support Agreement is required to be in writing and signed by both parents, independent legal advice is not a requirement. Before the agreement can be accepted by the Child Support Agency, an assessment for child support must have been completed, and the amount in the Limited Child Support Agreement must be equal to or greater than the amount required under the assessment.
A Limited Child Support Agreement can be ended if:
What is a Binding Child Support Agreement?
A Binding Child Support Agreement is a financial agreement between the parents about their child support and does not require a child support assessment. Any amount may be contemplated in the agreement in monetary payments or other payments. Independent legal advice is a requirement of entering into or ending a Binding Child Support Agreement, and a certificate will be required. A Binding Child Support Agreement must satisfy the child support legislation and provide for future circumstances.
A Binding Child Support Agreement can also be made where a private lump sum payment or transfer of property is made in lieu of periodic child support payments. However, this scenario will require a child support assessment to confirm that the value is equal or greater than the annual child support rate.
A Binding Child Support Agreement can only be terminated before the end date in the agreement if a new Binding Child Support Agreement is made by the parents ending the first Binding Child Support Agreement. A Family Court order to set aside a Binding Child Support Agreement will be costly, lengthy and extremely difficult. Therefore, it is important to always seek legal advice as soon as possible if you are contemplating a Binding Child Support Agreement.
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More Information on Mediation & Family Dispute Resolution
- Family Dispute Resolution
- Parenting Plans
- Financial Agreements
- Child-Inclusive Mediation
- Section 60I Certificates
- Child Support
- Child Support Calculator
- De Facto Relationships & Separation
- Divorce & Mediation
- Grandparents & Mediation for Grandchildren
- Parenting Plan & Draft Consent Orders for Children
- Property Settlement at Mediation
- Mediation & Domestic Violence
- Relocation & Overseas Travel with a Child
- Going to the Family Court versus Mediation
- Family Dispute Resolution & Mediation
- Child Support & Mediation
DISCLAIMER: The information contained on this website is for general guidance only. No person should act or refrain from acting on the basis of this information. Professional legal advice should be sought based upon your particular circumstances, because laws and regulations undergo frequent changes.