Child support is a financial payment made by one or both parents to support their child’s financial needs after separation or divorce. It is designed to ensure that both parents contribute to the costs of raising their children. There is no specific items that it needs to be used for, as it’s generally up to the receiving parent to direct the child support amount received to assist with their children’s general living costs.
Child support is generally organised through Services Australia (formerly known as the Child Support Agency), which manages and enforces child support payments. Many families choose to enter into private agreements, such as Limited or Binding Child Support Agreements, rather than use the government system.
Services Australia has two types of options for payment arrangements made through their system too – ‘government collect’ or ‘private collect’, which the receiving parents can decide on, based on their circumstances. It’s essential to be aware that if ‘private collect’ is chosen, Services Australia may not be able to collect unpaid amounts, and it may require going to court to do so. However, any amounts that are meant to be collected from the paying parent will be assessed as being received (even if they are not), which can impact Family Tax Benefit Part A.
How are child support assessments made?
Service Australia’s assessment is based on the parents’ income (after a self-support amount is deducted) and the children’s care arrangements, which means it can fluctuate if either parent’s earnings or care time change.
It may also vary based on other factors, such as whether multiple child support assessments are in place (due to children from different relationships) and the age of the children assessed (older children are assessed at higher rates). The number of children on an assessment also changes child support assessments, with multiple children in the same family being assessed differently from the single-child rate.
The formula Services Australia uses considers a set amount for each parent’s costs of ‘self-support’, which is an annually indexed figure, called the MTAWE. This is an average of one-third of the ‘Male Total Average Weekly Earnings’ (MTAWE), which is set at $29,841 for 2025. This amount is expected to cover your self-support costs, even if they are much lower or much higher.
The amounts assessed for payment to the receiving party are based on an average figure of the cost of raising children, including housing expenses, food, medical costs and education expenses. In rare cases, the assessment may be adjusted if exceptional circumstances exist, such as high medical expenses or private school fees.
Private child support agreements
A limited child support agreement is a private agreement between the parents that either party can end after three years. A binding child support agreement is a formal agreement that requires independent legal advice and can only be ended by a further agreement or court order.
Child support agreements of this type can include periodic payments, lump sum payments or non-cash payments. Services Australia can collect and enforce child support payments under a binding child support agreement. A paying parent may choose to use this to cover private school tuition, rather than a child’s basic needs, for instance, if the receiving parent is able to meet the general costs of raising their child, or children.
What does child support cover in Australia?
Child support in Australia is designed to meet the costs of raising children, including food, clothing, a home, health and education. The receiving parent can choose how the support is spent and used for their child or children.
The receiving parent has discretion in how child support payments are spent to meet the child’s needs, and in many cases, especially in recent times, they may go towards meeting rent or mortgage payments. The paying parent does not generally decide how the payments are spent unless both parents have a private agreement in place that sets this out.
Child support relies on the receiving parent’s common sense to best support their children, and this is obviously dependent on the receiving parent’s expenses and financial situation. Child support can also cover additional expenses, such as extracurricular activities, medical expenses and private school fees.
Non-agency payments
Services Australia uses the term non-agency payments to describe payments made by the paying parent to third parties instead of the receiving parent. This means that if a paying parent makes direct payments or third-party transfers that fall outside of regular child support payments, they can report them to the Child Support Agency as child support payments. They advise on their website to speak to the other parent before doing this, but at times will deduct them anyway even if the receiving parent disagrees.
These payments can include:
- Payments transferred directly to the receiving parent
- Payments made for food, clothing, shoes, uniforms, housing expenses, medical needs, health insurance, dental, childcare or school fees
- Payments towards classes or sports
- Some other expenses
These credits can only be made for a prescribed non-agency payment when:
- They are 30% or less of the total child support amount, and the other 70% of child support is being paid on time
- If the paying parent has less than 14% care of the child
Care arrangements
Care arrangements refer to the child’s living arrangements, including the amount of time spent with each parent. Services Australia considers the care arrangements when calculating the amount of child support payable.
The care arrangements can affect the amount of child support payable and the parents’ eligibility for a Family Tax Benefit. Parents can agree on care arrangements, or the court can make an order. The care arrangements can be changed if circumstances change, such as a parent’s work schedule or the child’s needs.
What if parents disagree about the amount of child support paid, or how it is spent?
In some cases, there may be conflict over how much child support is paid, or one parent may disagree about how the other parent spends child support payments. Services Australia decides on set formulas for standard child support payments, and a request to review a child support case would need to be made. It’s unlikely that a parent could choose where the child support funds are directed if a child’s needs are being met by the receiving parent.
However, in special circumstances, there may be some ability to pay child support to meet specific needs. Every case is unique and would need to be assessed on its merits.
Disputing a child support decision through the Administrative Review Tribunal
The Administrative Review Tribunal (ART) is an independent body that reviews Services Australia decisions. If a parent disagrees with a child support decision, they can appeal to the ART. The parent can also seek legal advice and representation, provide additional information or evidence to support their case, and have Services Australia review the decision and make a new assessment.
The ART can review decisions about child support assessments, care arrangements and payment amounts. It can also review decisions about Family Tax Benefits and other government benefits. If the parents disagree with a decision made by Services Australia, an appeal to the ART can be initiated, which can make a decision that is binding on the child support paid or receivable. This may occur if children have special needs that basic child support does not cover, or if one parent is hiding assets or income to unfairly skew an assessment.
Changing circumstances
If circumstances change, such as a parent’s income or the child’s needs, a child support assessment will be adjusted. If parents have a private arrangement, they can agree on a new child support arrangement, or Services Australia can make a new assessment after reviewing the care arrangements and adjusting the child support assessment accordingly. Parents may need to seek legal advice and representation if they are unable to agree on the amount of child maintenance being paid.
Once again, the basic formula child support uses does not generally look at the overall financial responsibilities of each party or the finer details. This can sometimes result in assessments that are unfair, for instance, of one party uses trusts, business structures, deductions or other methods to significantly lower their income.
Conclusion
Child support is an essential aspect of family law, providing financial support for children after separation or divorce. The child support system is designed to ensure that both parents contribute to the costs of raising their children, but it can be spent as the receiving parent sees best to support their child or children.
Services Australia can provide information and assistance to help families understand child support, but a trusted Family Lawyer can help you understand more about child support payments, obligations and entitlements. If you are unsure about child support and the best way to manage it, please get in touch with our team for a confidential chat on 1300 699 688 about how we can help, or send us a message via our contact form.
