The child support legislation imposes a legal obligation on parents to provide for the financial support of their children.
The role of Services Australia (Child Support) (or as they are more commonly known, the “Child Support Agency”) is to assess and collect child support. The amount of child support payable pursuant to an assessment is calculated using a specific formula that takes into account:
- the financial circumstances of each parent (the starting point is each parent’s ‘taxable income’);
- the ages of the children;
- the level of care each parent provides for the children;
- whether either parent supports other children;
- the estimated costs of caring for children; and
- any special needs of the children.
Once an assessment is issued most parents are able to arrange collection either, through a private arrangement or a paying parent can choose to have their child support payments automatically deducted from their pay.
In situations where there has been a lack of commitment by a paying parent to meet their child support responsibilities the following enforcement options are available through the Child Support Agency.
1. Employer Deductions of Arrears
In circumstances where they are arrears in relation to child support, the child support agency may require an employer to deduct the payments directly from the payer’s wage or salary.
2. Intercepting Tax Refunds
The Australian Tax Office is obliged to advise the Child Support Agency when a tax refund is available to a child support parent and is about to be paid. The child support agency may then take the refund and apply it to meet an outstanding child support payment.
3. Issuing overseas travel bans
If a paying parent has overdue child support and refuses to work with the Child Support Agency to pay the overdue amount, the child support agency is able to prevent the payer from travelling overseas by issuing a departure prohibition order (DPO).
A DPO is an administrative order that the child support agency can issue to prevent parents from leaving Australia until they pay their overdue child support or negotiate a satisfactory payment arrangement. The child support agency does not require a court order to prevent a payer from leaving Australia.
4. Garnishing Bank Accounts
The Child Support Agency is also able to apply to place a notice on bank accounts to recover unpaid child support where no payment arrangements are in place. This would mean that any significant funds in a payee parent’s bank account or intended to come into their account, for example a property settlement to be paid into a solicitor’s trust account, may be garnished to pay any outstanding arrears.
This step will usually only be taken only after discussion and negotiation with the debtor has failed.
5. Litigation
Where other enforcement methods have not worked and where an asset or income stream is identified in the payer’s name, the Child Support Agency is able to take a parent to court to collect outstanding child support payments.
