Child Support in Australia

In Australia, we have a child support calculation system that caps the amount a liable parent (“the payer”) will pay in child support when a separation or divorce happens. The formula is found in part 5 of the  Child Support (Assessment) Act 1989 (the Assessment Act).

The formula used by the Child Support Agency takes into consideration the age of the child, the number of children, the nights of care and the income of the parents and generates an amount that is payable by the liable parent.

Assessment Special Circumstances

However, there are special circumstances, where either parent can make a departure application under Part 7, Division 4 of the Assessment Act. The parent must first seek a change of assessment with the child support agency before any applications can be made at Court.

Section 117 of the Assessment Act provides that where it would be just and equitable and where there are one or more grounds of departure as specified by the Act, then the Court can make such an order as to vary and depart from the child support assessment.

How Do Departure Orders Apply?

One of the most common grounds for departure Orders that are made is because of the income, property and financial resources of the parent or because of their earning capacity. For parents with high earning capacity or high net individual worth this is the area that cause much angst.

In the leading case of Gyselman, the Full Court of the Family Court of Australia found that a 3 step approach is necessary:

  1. Establishing a ground of departure;
  2. Considering whether the departure it is just and equitable;
  3. Considering whether the departure is proper.

The question that needs to be considered is whether the fact that a parent has a high income, is grounds for departure and is a special circumstance which warrants the change of an assessment.

It is of course very different if a parent shows a low income because they have created schemes whereby their money flows outside the scope of their personal income, this may constitute a special circumstance.

If you are a parent, who is dealing with a departure Application on the grounds of your earning capacity of financial resources or property, we are able to assist you.

For help contact us.