The Child Support (Assessment) Act 1989 provides that every parent has a primary duty to maintain their child. Parents often pay or receive child support payments in accordance with an assessment made by the Child Support Agency at the Department of Human Services. The amount of child support payable is calculated using a formula, which accounts for, amongst other factors, the parents’ respective incomes and the time a child spends with each parent. Parents can apply to the Child Support Agency to administer and enforce child support payments on their behalf.
Some parents find that child support payments do not cover the full range of expenses associated with raising their children. For example, if their child is attending private school or requires significant and ongoing medical care, child support payments may not suffice. Parents in these circumstances might seek to depart from the child support assessment made by the Child Support Agency and instead enter into a Child Support Agreement.
Child Support Agreements
A Child Support Agreement allows parents to make their own private arrangements for the provision of financial support for their children under the age of 18 years (or children over the age of 18 years who are completing their secondary education).
Under a Child Support Agreement, parents can agree to pay over and above the child support assessed by the Child Support Agency and contribute to expenses not otherwise covered by a child support assessment, such as:
- School tuition fees and levies;
- Associated school expenses including uniform, books, stationary, computers, camps and excursions;
- Expenses for extra-curricular activities for the children;
- Private health insurance levies and gap medical, allied health and dental expenses;
- Childcare fees for the children.
There are two kinds of Child Support Agreement:
- Limited Child Support Agreements; and
- Binding Child Support Agreements.
Limited Child Support Agreements
A Limited Child Support Agreement is an agreement between parents or carers that child support be paid equal to or greater than the amount assessed by the Child Support Agency. The parties do not need to obtain legal advice, however, in order to ensure that the agreement is fair and equitable, an assessment by the Child Support Agency must already exist and the Agreement must be registered with the Child Support Registrar. A Limited Child Support Agreement can be terminated by either parent 3 years after it is made.
Binding Child Support Agreements
A Binding Child Support Agreement can only be made after both parties have obtained independent legal advice. The Agreement can provide for payment of an amount of child support higher or lower than the amount assessed by the Child Support Agency. The Agreement remains in force until such time as each child reaches the age of 18.