Child support is calculated based on established legal frameworks and cannot be avoided entirely

However, there are several ways parents can reach agreements:

1. Private Agreements:

   • Limited Child Support Agreements: These informal arrangements allow co-parents to decide on the financial contributions without requiring legal consultation. The agreement can be modified as circumstances change.
   • Binding Child Support Agreements: A more formal approach requiring independent legal advice for both parties. These agreements can cover school fees, health insurance, and irregular expenses like extracurricular activities or dental care.

2. Government-Assessed Support:
   When parents cannot agree privately or if one parent refuses to pay, the Department of Social Services (DSS) steps in to assess and enforce child support payments under the Child Support (Assessment) Act 1989 (Cth).

What Factors Influence Child Support Calculations?

Child support is calculated primarily based on:

1. Time Spent with the Child: The percentage of care each parent provides.
2. Income: The earning capacity of each parent.
3. Number of Dependent Children: The number of children reliant on financial support from the parent.

For example:

• If a child spends 50% of their time with each parent, each parent pays a proportionate share of the costs.
• If one parent earns significantly more, they will contribute a higher financial amount, ensuring the child receives equitable support from both parents.

How is Child Support Calculated?

Child support is based on taxable income and follows these guidelines:

• Salary packaging, salary sacrifice, and property losses from negative gearing are included in income calculations and cannot reduce child support obligations.
• If a parent’s income decreases by more than 15%, they must notify DSS immediately. This ensures the support amount is adjusted promptly.

What Happens if Child Support Isn’t Paid?

Failure to pay child support has serious consequences:

• Enforcement by DSS: DSS can garnish wages, withhold tax refunds, and prevent delinquent parents from traveling overseas.
• Legal Action: Persistent non-payment may result in litigation or prosecution.
• No Discharge in Bankruptcy: Child support debt remains enforceable even if the paying parent declares bankruptcy.

If a parent is struggling to meet obligations, DSS may accept payment installments to reconcile outstanding debt.

Key Takeaways

• Child support ensures children receive adequate financial support from both parents.
• Parents can establish private agreements or rely on DSS for assessment and enforcement.
• Calculations are based on care percentage, income, and dependents, ensuring fairness and equity.
• Failing to pay child support leads to significant legal and financial consequences.