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How to Calculate Child Support in Australia?

What is child support? Child support is the money which is paid by parents to give financial assistance to the child. Usually, this amount is paid by the non-custodial parent to the custodial. But this depends on the agreement between the parents. This amount can change according to the decided expenses. The methodology of child […]

How to Calculate Child Support in Australia?

How to Calculate Child Support in Australia?

What is child support?

Child support is the money which is paid by parents to give financial assistance to the child. Usually, this amount is paid by the non-custodial parent to the custodial. But this depends on the agreement between the parents. This amount can change according to the decided expenses.

The methodology of child support:

Child support is complicated for both the parties. The rules may be different for each parent depending on the situation. It is wise to consult a family law attorney like Aylward game. They will explain the procedure that applies to your condition.

Below we have tried to explain the basic procedure of child maintenance.

  • Each parent contributes in child maintenance.
  • The cost varies according to the ages and number of children.
  • The parent with higher income will pay more.
  • The custodial parent gets extra credit.
  • The parent will contribute only if his income is greater then the expenses.

The child support is calculated by the following formula:

Child support = costs of children * (Income – expenses)

If this formula gives a positive result then you will have to pay the child maintenance.

Where to use child support?

As, the child maintenance is paid to support the child financially. And to maintain his living standard. So, the custodial parent cannot use these expenses for their personal needs. Like saloons, entertainment, or the vacations in which the child is not involved. The child support payments can be used for:

  1. Shelter, which includes rent or mortgage. It also covers the basic home needs of the child.
  2. Food, clothes, toys and books the basic needs of the child.
  3. Medical expenses to maintain the health of the child. The parent who is paying the child maintenance can also use his health insurance plan to provide this facility.
  4. All of the school expenses.
  5. And the extracurricular expenses like sports or summer camp.

These expenses are clearly defined in the agreement. So, both parents can understand their responsibilities.

How much is child support?

This amount is a variable. It is dependent on the incomes of parents. You will pay according to your earning and the expenses you face. The one who earns more will have to pay more child maintenance. Usually, the following factors are taken into consideration to get a child maintenance assessment.

  1. The tax on parents’ income
  2. The number of nights of each parent with the child or children.
  3. The number of children with the age of less than 13, and the ones who are between 13 and 17.

Let’s dig deeper to know more about child sport in QLD.

How much child support will I pay?

This is an essential factor in calculating child support in Australia.

The child maintenance is not calculated on your gross salary. You may have to pay taxes. These can be income tax, property tax or other taxes. In the child maintenance  formula, the recent tax return is used. Then there are some personal requirements. The formula assumes a certain self-support amount. It is one-third of Male Total Average Weekly Earnings (MTAWE). In 2020 self-support is 25,5757 dollars.

Before applying the child support formula, the tax and the self-support income is subtracted. You will pay only what you can easily afford. A specific percentage of income decides your share in child maintenance.

Support for each child:

To calculate the cost of each child you can use the following Government’s costs of the children table.

https://guides.dss.gov.au/child-support-guide/2/4/2#mtawe

Child support period starting in Annualised MTAWE figure Self-support amount (1/3 MTAWE) Default income (2/3 MTAWE) Fixed annual rate of child support Parenting payment single, maximum basic amount (PPS) Minimum annual rate of child support Child support inflation factor
2008 $54,756 $18,252 $36,504 $1,122 $13,980 $339 5.0%
2009 $56,425 $18,808 $37,617 $1,178 $14,615 $356 3.3%
2010 $58,854 $19,618 $39,236 $1,193 $14,937 $360 3.8%
2011 $61,781 $20,594 $41,187 $1,226 $15,909 $370 4.7%
2012 $64,865 $21,622 $43,243 $1,269 $16,679 $383 4.2%
2013 $67,137 $22,379 $44,758 $1,294 $17,256 $391 4.1%
2014 $70,569 $23,523 $47,046 $1,322 $18,197 $399 4.8%
2015 $70,829 $23,610 $47,219 $1,352 $18,728 $408 1.8%
2016 $71,256 $23,752 $47,504 $1,373 $19,011 $414 1.3%
2017 $72462 $24,154 $48,308 $1,390 $19,201 $420 2.1%
2018 $73,606 $24,535 $49,071 $1,416 $19,568 $427 1.6%
2019 $75,114 $25,038 $50,076 $1,443 $19,981 $435 2.4%
2020 $76,726 $25,575 $51,151 $1,467 $20,298 $443 2.5%

 The following factors also affect the costs of children.

Number of children:

More children mean more cost. A 2nd child can add 50% to the costs of the 1st child. If you have 3 children it will cost double as compared to the cost of a single child.

Ages of children:

The ages of the children also have an impact on child maintenance. If they are 13 and above they will cost 20% more then the children of age 12 and below.

Your income:

The child maintenance increases with the increase in your income. If both of you have income below the self-support then there will be no self-support.

The child will get the support if the income is 2.5 times MTAWE. And this happens usually when both parents have a combined taxable income of 3.167 times MTAWE. The minimum child maintenance of 2020 is 443 dollars.

Income shares:

Each parent contributes a certain percentage of the income for child maintenance. Each of them will be responsible for covering the specific percentage of the costs of a child. It is your choice to pay the child maintenance or to take the child under your custody.

For instance, if you have 70 percent of the combined income then you will have to meet the 70 percent requirements of the child. Similarly, If the child is spending more nights with you then you will receive child maintenance.

Cost Shares:

The custodial parent gets credit for taking care of the child or children. The cost of the child for which the credit is given is the percentage of your cost. This cost is calculated according to the table given below.

https://www.servicesaustralia.gov.au/individuals/services/child-support/child-support-assessment/how-we-work-out-your-assessment/basic-formula#careandcost

Care percentage Equal to number of nights a year Equal to number of nights a fortnight Care level Cost percentage
0-13% 0-51 1 Less than regular care 0%
14-34% 52-127 2-4 Regular care 24%
35-47% 128-175 5-6 Shared care 25% plus 2% for every percentage point over 35% of care
48-52% 176-189 7 Shared care 50%
53-65% 190-237 8-9 Shared care 51% plus 2% for every percentage point over 53% of care
66-86% 238-313 10-12 Primary care 76%
87-100% 314-365 13-14 More than primary care 100%

 

The care is calculated according to the number of nights you have the child in a year. To calculate it the number of nights is divided by 14 that is a fortnight.

The above table gives the difference between the percentage of cost and care. The result is often unclear but for many parents, the percentage of cost is equal to the care.  

Calculating the child support:

In the last step, the cost of the child or the children is multiplied by the difference of cost percentage and income percentage.

The custodial parent will receive support if the care % is greater then 35% and the cost percentage is greater then his or her income. You will have to pay child maintenance if the care % is less then 65% and the income percentage exceeds the cost.

The Department of Human Resources decides the amount of child maintenance. The child maintenance assessment has an annual figure, the monthly billed amount and the current balance. It can change only in special circumstances by a change of assessment review.

Read More: https://familylaw.aylwardgame.com.au/services/child-support/

Conclusion:

When parents are no longer living together, there is a problem in raising the child or children. One cannot do this alone. To meet the child’s financial needs child maintenance is needed. It is paid to give a good lifestyle to the child. The parents cannot use the child maintenance for their personal needs. This law helps the child to get his rights.

Frequently asked questions:

What is child support for in Australia?

Child support is an amount which is paid by both parents to support the child financially.

When child maintenance end?

The child support is paid until the child turns 18 or 19. But if the child is unmarried and still attending high school then the court may as to continue the child maintenance.

Is it mandatory to pay child support?

Yes, it is mandatory. You will have to pay child maintenance until the child turns 18. But if he is 18 and still in high school, you will have to pay child maintenance.

Should I hire a lawyer for child support?

It is good to have a lawyer. He will make the implementations of the child maintenance easier.

Does the child support increase with the increase in income?

It depends on the increment. If the increment is at least 10 percent of the previous income then there will be a change in child support. You will have to pay a bit extra amount.