What Are the 2 Agreed Types of Child Support?
In Australia, child support arrangements are guided by federal legislation, mainly the Child Support (Assessment) Act 1989, administered by Services Australia. Parents can choose from different approaches to meet their child support responsibilities. Two of the most commonly agreed-upon types are Child Support Assessments and Child Support Agreements.
1. Child Support Assessment
A Child Support Assessment is a standard calculation performed by Services Australia (formerly the Child Support Agency). It determines how much one parent should pay the other parent based on a statutory formula. This is the most common method used in Australia.
Key features:
- Legally binding and administered by the Government.
- The formula takes into account each parent’s income, the number of children, and the time each parent spends caring for the children.
- Payments can be made directly between parents or collected and disbursed by Services Australia.
- The assessment is regularly reviewed and can be reassessed if there is a significant change in circumstances (such as income or care arrangements).
This approach suits situations where parents may not be on amicable terms or where consistency and formal enforcement are necessary. It ensures that both parents contribute according to their capacity to support the children.
2. Child Support Agreement
A Child Support Agreement is an alternative to the Government’s formula. It allows parents to come to their own agreement on how much, when, and in what form child support will be paid. There are two main types:
- Binding Child Support Agreements; and
- Limited Child Support Agreements
Each type has its own legal and practical implications.
Binding Child Support Agreement
- Must be in writing and signed by both parties.
- Both parents must receive independent legal advice before signing.
- Can include payment amounts higher or lower than the standard assessment.
- Legally enforceable and cannot be varied, only terminated or replaced by a new agreement.
This type of agreement is ideal for parents with a clear understanding of their financial responsibilities who want long-term certainty.
Limited Child Support Agreement
- Also must be written and signed by both parties, but does not require legal advice.
- It can only be made if a child support assessment is already in place.
- The agreed amount must be equal to or greater than the assessed amount.
- Can be terminated more easily than a binding agreement, after three years or if circumstances change by a prescribed amount (e.g. income shift of 15% or more).
This is often preferred where parents are cooperating but still want flexibility as life circumstances change.
Which Option Is Best for You?
The most suitable option depends on your family’s situation. If you and your spouse/former partner can cooperate and communicate well, a private agreement may offer more control and flexibility. However, if consistency, enforcement, or reduced contact is important, the Government-administered child support assessment can offer structure and security.
Contact Us
If you’re unsure which route to take, seeking independent legal advice is strongly recommended. This can help you understand your rights and responsibilities under the law, and ensure any agreement you reach is legally sound and enforceable.
For more information, contact Bambrick Legal today. We offer a free, no-obligation 30-min consultation for all enquiries.
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