Income Assessment for Child Support
How do you work out what my income is?
Several types of income are taken into account when working out child support payments for both parents. The CSA will add up these amounts to get your adjusted taxable income, which is based on your last completed financial year of income:
- taxable income - the income shown on your tax return
- gross reportable fringe benefits - the value of gross reportable fringe benefits total for the income year, which is reported on your payment summary
- target foreign income - any foreign income you receive that is not taxable income or a fringe benefit
- net rental property losses - which will be added back on i.e. where you have a rental property and the costs outweigh the income
- some tax free pensions - including disability support pensions, wife pensions, carer payments and some Veterans’ Affairs payments
Will I have money to support myself?
Before the child support formula is used to work out your child support, the CSA will deduct the self-support amount from each parent’s adjusted taxable income.
How much of my income will go to child support?
Each parent’s income is considered in exactly the same way and combined to work out the costs of the children. Each parent’s share of the total income shows how much of the children’s costs they should meet.
Your child support assessment is based on your child support income. Your child support income is obtained by deducting the self-support amount, then deducting a relevant dependent child amount and/or a multi-case allowance if applicable, from your adjusted taxable income. This amount is then used in step one of the formula to work out for much child support is payable.
Are my assets included as part of my income?
Your immediate assets such as properties, vehicles or furniture for example are not included in your child support income.
If I am on a low income and receive Centrelink benefits do I have to pay child support?
Paying parents who receive income support payments, and whose income is less than the self-support amount, will generally pay the minimum payment of around $6 per week per family.
If I am a casual worker and my pay varies – how will CSA work out my income?
If your pay varies significantly you can ask to have your child support assessment based on an estimate of income in some circumstances. An estimate review will take place if the estimate needs to be updated.
How are second families factored in when calculating child support?
The child support formula treats children of first and second families in a similar way by using the costs of children table to work out the cost of the children from the second family. This amount is deducted from your income before working out the child support payable.
Are my new partner’s children counted as my step-children when calculating child support?
If you have a child support case and also care for a step-child you can apply for a change of assessment to have your child support payments reviewed.
To have this care recognised, the parent must be able to demonstrate:
- they have, or had, lived with the parent of the step-child for a continuous period of two years or more (in a marriage or de facto relationship);
- the parents of the step-child cannot support the child because of:
- ill-health that prevents them from working or
- their caring responsibilities-for example, caring for a young child or an older child with disabilities; and
What happens if you don’t pay the overdue amount?
If you have missed a payment, you need to contact the CSA and get back on track, so the problem doesn’t get out of control.
The CSA will follow this process when trying to recover overdue child support.
- Telephone the parent to discuss the outstanding payment, including giving them the chance to pay outstanding amounts voluntarily.
- Assess the parent’s ability to pay and their attitude towards paying the outstanding amount.
- Confirm the arrangements to clear the outstanding payment.
- Discuss options for making ongoing payments and confirm arrangements.
- If the parent refuses to pay, we determine the best enforcement option based on previous behaviour, risk and available data.
How can overdue child support be recovered?
The legislation gives the CSA powers to recover overdue child support through a number of ways, including:
- automatically deducting child support from your pay or income support payment
- working with banks to deduct money from your bank accounts
- working with third parties to pay the money to us on your behalf
- intercepting tax return refunds
- stopping you from leaving the country
- taking you to court.
What are late payment penalties?
Late payment penalties apply whenever a paying parent fails to pay their child support debt by the due date. CSA can only get rid of these penalties in certain circumstances, such as paying parents not being able to make payment due to of other expenses beyond their control. This could be for example, short term unemployment, industrial accidents, unpredictable adverse business conditions or natural disasters.
Phone: (02) 9997 5142
Disclaimer: This fact sheet provides general information and does not provide legal advice. If you have a legal issue, you should contact a lawyer before making a decision about what to do or applying to a court.