Parents have a legal obligation to financially support their children.
When a child’s parents have separated, or have never lived with one another, they are entitled to implement arrangements for their child’s financial support. Most often the parent with the primary care of a child will initiate the process to seek child support from the other parent.
The Child Support Agency is a government authority which serves several functions. Firstly, an application can be made to the Child Support Agency to conduct an administrative assessment of a parent liable to pay child support. A formula is used to determine how much child support is payable on an annual basis. The factors taken into account include the income of both parties, and the number of nights per annum the paying parent spends with the child. Otherwise, after a Child Support Assessment issues, the Child Support Agency can collect the child support payments and distribute it to the party entitled to receive it.
Sometimes a Child Support Assessment does not result in an appropriate level of child support to be payable. This can be for a number of reasons. In these cases where the assessment may not take into account other factors, an Application for a Change of Assessment can be made. This involves an internal process through the Child Support Agency.
Often parents prefer to make their own arrangements for child support, particularly if the administrative assessment process and change of assessment process has proved unsatisfactory. Alternatively, where the parties’ financial arrangements are more complex or the children have special needs, such as special health care needs or they are being educated privately, then the alternative option is to negotiate a Child Support Agreement.
Parties may enter into a Child Support Agreement which would preclude the Child Support Agency from conducting an administrative assessment. It can fix the rate of periodic payments of child support and also make provision for the payment of other expenses on behalf of the children, such as school fees, health insurance premiums, and extracurricular activities.
Parties contemplating entering into a Child Support Agreement ought to seek independent legal advice as there are two types of Agreement available, and which one is appropriate will depend on the circumstances of the case.
Where separated parents are contemplating child support arrangements, it is recommended that account be given to any likely property division and the needs of the children post financial settlement, when contemplating what child support arrangements may be appropriate.
For assistance with Family Law matters, phone Dominic Wilson, Managing Partner of Craddock Murray Neumann, on (02) 82684000. We have Family Lawyers who are certified by the Law Society of New South Wales as Accredited Specialists in Family Law.