Whenever parents split and are going through a divorce, one of the subjects which their respective family lawyers are asked questions about the most is, child support arrangements.
Child support arrangements will always be a key aspect of any divorce, so it is important that both parents are fully informed. This ensures that when it comes to agreeing, or being subject to, a child support arrangement, they are fully aware of what they are and what they mean.
Child support arrangements can be set up and managed in several different ways, and this is important. The arrangements and processes that are available can cater for divorces which are amicable and there is lots of agreement between the two parties.
They can also deal with those which are contentious and whether neither parent agrees with, nor wishes to accept what the other is proposing.
If There Is a Disagreement
Where there is a disagreement between the parents or no possibility of a private arrangement between them, the Child Support Agency will formalise the whole process.
This is based on a formula which it uses to assess how much child support should be paid based on the parents’ individual incomes, the parents’ combined income, the amount of time each parent will be spending with each child, and the age of each child.
Based on these, and other data related to costs involved with caring for and bringing up children, the Child Support Agency will assess the amount of child support due. They will then contact the parent liable for payment and arrange for collection of it.
An alternative is a private child support agreement is where both parents are happy to agree on amount of child support that takes into account some aspects of the child’s financial needs which the child Support Agency does not. These include private school fees, private health insurance, and costs incurred where the child has special needs.
Private agreements come under two headings: Binding Child Support Agreement (BCSA), and Limited Child Support Agreement (LCSA). Each has different obligations, and formalities that must be adhered to.
A limited agreement lasts for just 3 years, and although informal, it does require a child support administrative assessment to be in place when the parents apply for the limited child support arrangement with the Registrar.
The child support assessment will set a figure that would normally be payable by the parent making the payments, and the figure agreed between parents must not be any less than that amount.
For example, if an administrative assessment states that the father must pay $15,000 per year for child support to the children’s mother, any limited agreement which the parents make informally must be for at least $15,000 per year.
A limited agreement can be done in discussions between the parents themselves, and although there is no legal requirement for lawyers to be involved, it is always recommended that each parent does seek legal advice before agreeing to any kind of child support arrangement.
A binding child support agreement will only terminate when each child reaches the age of 18, and the amount payable can be for any amount as agreed between the parents, including less than the child support assessment.
Regardless of which kind of arrangement is eventually implemented, the following obligations will be in place for the parent who is paying the child support: 1) Tax return must be lodged on time, 2) Accurately report all income, 3) Any changes in circumstances must be reported, and 4) All support payments must be paid on time.