There are six formulas used by the Department of Human Services (Child Support) (depending on the circumstances of the family).
Because of the complexities of the formula, it is highly recommended that you don’t attempt to do your own calculations pursuant to the formula. For further information and calculations under the child support formulas, please visit: www.humanservices.gov.au/customer/enablers/online-estimators. Should you need to contact the Department of Human Services regarding child support, their phone number is 131 272.
The basic formula
Section 35 of the Child Support (Assessment) Act 1989 (Cth) sets out the basic formula comprising eight steps as follows:
- Step 1: Work out each parent’s child support income
- Step 2: Work out the parents’ combined child support income
- Step 3: Work out each parent’s income percentage
- Step 4: Work out each parent’s percentage of care for the child
- Step 5: Work out each parent’s costs percentage for the child
- Step 6: Work out each parent’s child support percentage for the child
- Step 7: Work out the costs of the child
- Step 8: The annual rate of child support is calculated using the formula - child support percentage x cost of child
We have provided examples in the follow pages of how the formula works.
Checklist: How the basic formula works
The basic formula:
- adds both parents’ incomes after deducting each parent’s self support amount;
- determines what percentage of the total income is obtained by each parent;
- works out a percentage of each parent’s care of the children using the number of nights the child or children spends with the parent;
- applies the percentage of care against the costs of children, which is not a flat amount (the costs of children increases when the income increases); and
- makes an adjustment from one parent to the other to make up any shortfall.
In relation to percentage care, there will be an effect on child support if there is an order for the children to spend time with a parent. There are five levels of care under section 55C of the Child Support (Assessment) Act 1989 as follows:
- Below regular care: 0% to less than 14% care of the child
- Regular care: 14% to less than 35% care of the child
- Shared care: 35% to less than 65% care of the child
- Primary care: More than 65% to 86% care of the child
- Above primary care: More than 86% to 100% care of the child
Actual nights and effect on costs percentage
| Level of care | Nights per annum with client | Effect of cost |
|---|---|---|
| Below regular care (0 to 14% of care) | 0-51 | Nil |
| Regular care (14% to less than 35% care) | 52-127 | 24% |
| Shared Care (35% to 47%) | 128 - 175 | 25% to 49% |
| Shared care (48% to 52% care) | 176 – 189 | 50% |
| Shared care (more than 52% to 65%) | 190 - 237 | 51% to 75% |
| Primary care (65% to 86% care) | 238 – 313 | 76% |
| Above primary care (86% to 100%) | 314 – 365 | 100% |
Any parent currently receiving a Centrelink benefit who has received an administrative assessment should check first with the Department of Human Services before signing a parenting order or parenting plan to see what effect it will have on their assessment.
There may be an impact on the Family Tax Benefit for any parent in receipt of Family Tax Benefit A or B and, in particular, the impact on an income tested pension or benefit should be checked first before signing a parenting order or parenting plan.
Refer to the Costs of Children table set out below from the Department of Human Services, which is updated each year.
Child Support Agreements
There are two types of child support agreements:
- Binding child support agreement
- Limited child support agreement
A binding child support agreement must be certified by two independent lawyers certifying that they have each advised their client of their rights and about the effect of the agreement.
A binding child support agreement cannot be terminated unless there is an order setting aside the agreement or the parties enter into a termination agreement. For example, a Court may set aside a binding child support agreement if it concludes that exceptional circumstances have arisen and the child will suffer hardship if the agreement remains in force.
A limited child support agreement need not be certified by independent lawyers.
A limited child support agreement can be set aside if the amount provided for the child support is not “proper or adequate” in the circumstances or because there was a change of circumstances of one of the parties and it would be unjust if the agreement remains in force.
If a limited child support agreement varies more than 15% with a notional assessment from the Department of Human Services, the agreement may be terminated. After three years, either party can terminate a limited child support agreement.
No child support agreement should be entered into (whether limited or binding) without first checking the Family Tax Benefit implications and the extent to which any proposed agreement differs from a notional child support assessment. You should also obtain advice about which type of child support agreement is suitable to your circumstances.
Table: Costs of children 2021 (if your child support period starts during 2021)
Policy reference: CS Guide 2.4.4 Child Support Income
Table: costs of children 2021 (if your child support period starts during 2021)
| Table A - Costs of children 2021: Children aged 12 years and under (apportioned between parents) | |||
|---|---|---|---|
| Parents' combined child support income | 1 child | 2 children | 3 or more children |
| $0 to $39,479 | 17c for each $1 | 24c for each $1 | 27c for each $1 |
| $39,480 to $78,957 | $6,711 plus 15c for each $1 over $39,479 | $9,475 plus 23c for each $1 over $39,479 | $10,659 plus 26c for each $1 over $39,479 |
| $78,958 to $118,436 | $12,633 plus 12c for each $1 over $78,957 | $18,555 plus 20c for each $1 over $78,957 | $20,923 plus 25c for each $1 over $78,957 |
| $118,437 to $157,914 | $17,370 plus 10c for each $1 over $118,436 | $26,451 plus 18c for each $1 over $118,436 | $30,793 plus 24c for each $1 over $118,436 |
| $157,915 to $197,393 | $21,318 plus 7c for each $1 over $157,914 | $33,557 plus 10c for each $1 over $157,914 | $40,268 plus 18c for each $1 over $157,914 |
| Income over $197,393 | $24,082 | $37,505 | $47,374 |
| Table B - Costs of children 2021: Children aged 13 years and over (apportioned between parents) | |||
|---|---|---|---|
| Parents' combined child support income | 1 child | 2 children | 3 or more children |
| $0 to $39,479 | 23c for each $1 | 29c for each $1 | 32c for each $1 |
| $39,480 to $78,957 | $9,080 plus 22c for each $1 over $39,479 | $11,449 plus 28c for each $1 over $39,479 | $12,633 plus 31c for each $1 over $39,479 |
| $78,958 to $118,436 | $17,765 plus 12c for each $1 over $78,957 | $22,503 plus 25c for each $1 over $78,957 | $24,871 plus 30c for each $1 over $78,957 |
| $118,437 to $157,914 | $22,502 plus 10c for each $1 over $118,436 | $32,373 plus 20c for each $1 over $118,436 | $36,715 plus 29c for each $1 over $118,436 |
| $157,915 to $197,393 | $26,450 plus 9c for each $1 over $157,914 | $40,269 plus 13c for each $1 over $157,914 | $48,164 plus 20c for each $1 over $157,914 |
| Income over $197,393 | $30,003 | $45,401 | $56,060 |
| Table C - Costs of children 2021: Children of mixed ages (apportioned between parents) | |||
|---|---|---|---|
| Parents' combined child support income | 1 child | 2 children | 3 or more children |
| $0 to $39,479 | N/A | 26.5c for each $1 | 29.5c for each $1 |
| $39,480 to $78,957 | N/A | $10,462 plus 25.5c for each $1 over $39,479 | $11,646 plus 28.5c for each $1 over $39,479 |
| $78,958 to $118,436 | N/A | $20,529 plus 22.5c for each $1 over $78,957 | $22,897 plus 27.5c for each $1 over $78,957 |
| $118,437 to $157,914 | N/A | $29,412 plus 19c for each $1 over $118,436 | $33,754 plus 26.5c for each $1 over $118,436 |
| $157,915 to $197,393 | N/A | $36,913 plus 11.5c for each $1 over $157,914 | $44,216 plus 19c for each $1 over $157,914 |
| Income over $197,393 | N/A | $41,453 | $51,717 |
Table sourced from the Australian Government Child Support Agency’s website.
Estimating child support: An example
This example has been calculated using the basic formula.
Relevant facts
Boris and Doris have separated. They have two children - Michael (aged 12) and Gemma (aged 10). Boris’ adjusted taxable income is $150,000. Doris’ adjusted taxable income is $80,000. The children spend four nights each fortnight with Boris plus half of the school holidays (122 nights per annum) and spend the rest of the time living with Doris. Boris does not have any other dependent children.
Step 1: Work out the child support income
| Boris | Doris | |
|---|---|---|
| Each parent’s adjusted taxable income | $150,000 | $80,000 |
| Deduct self support amount | $26,319 | $26,319 |
| Deduct relevant dependent child amount | $0 | $0 |
| Each parent’s child support income | $123,681 | $53,681 |
Step 2: Work out the combined child support income
| Boris | Doris | Combined Income | |
|---|---|---|---|
| Add each parent’s child support income | $123,681 | $53,681 | $177,362 |
Step 3: Work out each parent’s income percentage
| Boris | Doris | |
|---|---|---|
| Each parent’s child support income | $123,681 | $53,681 |
| Divide each parent’s child support income by the combined child support income ($76,982) | $123,681 ÷ $177,362 0.6973 | $53,681 ÷ $177,362 0.30266 |
| Multiply by 100 | 0. 9618 x 100 96.18 | 0.30266 x 100 30.27 |
| Each parent’s income percentage | 69.73% | 30.27% |
Step 4: Work out each parent’s care percentage
| Boris | Doris | |
|---|---|---|
| Four nights per fortnight plus half the school holidays (equals 122 nights per year) | 67% | 33% |
Step 5: Work out each parent’s cost percentage
As Boris has “regular care” (less than 35%):
| Boris | Doris | |
|---|---|---|
| Boris pays 24% of the cost of the children when they live with him, and Doris is responsible for the balance The cost percentage is taken from the child support care and costs table | 24% | 76% |
Step 6: Work out each parent’s child support percentage
| Boris | Doris | |
|---|---|---|
| Each parent’s income percentage (as calculated on page 4) | 69.73 | 30.27% |
| Deduct each parent’s cost percentage | 24% | 76% |
| Each parent’s child support percentage | 45.73% | -45.73% |
If there is a positive percentage, the parent with the positive percentage needs to pay child support.
Step 7: Work out the cost of the children
From Costs of Children Table for 2021 – two children 12 and under:
| Parent’s combined child support income: $177,362 | 2 children |
|---|
| Child | Cost of this child | Calculations |
|---|---|---|
| Michael | Income bracket base | $33,557 |
Income bracket additional amount Amount over cutoff: $19,448.00 Multiplied by income bracket additional percentage: 0.1 | 19,448 x 0.1 $ 1,944.80 | |
Income bracket base + Income bracket additional amount = total cost of children | $33,557 + $1,944.80 $35,501.80 (round up) | |
| Total cost of the children | $35,502 | |
| Divided by number of children | $35,502/2 | |
| Cost of Michael | $17,751 |
| Child | Cost of this child | Calculations |
|---|---|---|
| Gemma | Income bracket base | $33,557 |
Income bracket additional amount Amount over cutoff: $19,448.00 Multiplied by income bracket additional percentage: 0.1 | 19,448 x 0.1 $1,944.80 | |
Income bracket base + Income bracket additional amount = total cost of children | $33,557 + $1,944.80 $ 35,501.80 (round up) | |
| Total cost of the children | $35,502 | |
| Divided by number of children | $35,502/2 | |
| Cost of Gemma | $17,751 |
Step 8: Work out child support payable
| Child | Cost of the child | Child support percentage | Estimated amount payable | |
|---|---|---|---|---|
| Michael | $17,751 | x 45.73% | $8,118 | per year payable by: Boris |
| Gemma | $17,751 | x 45.73% | $8,118 | per year payable by: Boris |
| $16,236 | Total payable by Boris |
The estimated annual rate per year can be broken down further as:
| Child | Estimated amount week | Estimated amount fortnight | Estimated amount month |
|---|---|---|---|
| Michael | $156 | $311 | $676 |
| Gemma | $156 | $311 | $676 |
| Total payable by Boris | $311 | $622 | $1,353 |
This example is based on the 2021 Costs of Children Table. You might need to obtain further information or advice from the Department of Human Services if your child support period commenced in a year other than 2021.
To find out more
- Visit the Department of Human Services website.
- To access the 2021 Costs of Children Table, click here.
For more information about family law matters, please contact our Family Law team.
The contents of this paper are not intended to be a complete statement of the law on any subject and should not be used as a substitute for legal advice in specific fact situations. HopgoodGanim Lawyers cannot accept any liability or responsibility for loss occurring as a result of anyone acting or refraining from acting in reliance on any material contained in this paper.