If you have children under the age of 18 and are contemplating separating from your partner, you may be wondering if you are eligible for Child Support payments, or if you will be liable to pay Child Support.

The Child Support Agency are responsible for governing Child Support payments between separated parents. To determine the sum of money required to be paid to one parent, the Agency will complete an ‘administrative assessment’. This assessment is based on a complex formula that considers, amongst other things, the children’s care arrangements, the costs of the children and the parent’s income.

You are also able to reach your own agreement with regard to Child Support, that may or may not involve the Child Support Agency. A private Child Support agreement is a written agreement between the parties, for Child Support arrangements and can include provision for:

  1. Cash payments to the primary carer of the children, known as periodic payments; and/or
  2. Contributions to children’s expenses such as school fees, health insurance and extracurricular activities, known as non-periodic payments.

You can formalise your private Child Support Agreement by way of a:

  1. Limited Child Support Agreement (“LCSA”); or
  2. Binding Child Support Agreement (“BCSA”).

Both the LCSA and BCSA must be in writing and must be signed by both parties. There are some key differences in the agreements, such as:

There must already be an administrative assessment in place, with the Child Support Agency.No administrative assessment is required.
Child Support payments must be equal to, or more than the assessment generated by the Child Support Agency.Child Support payments can be for any amount, including an amount less than the Child Support assessment.
There is no requirement to obtain independent legal advice prior to signing a LCSA. However, we do recommend that you obtain legal advice before entering into a Child Support Agreement.Both parties must obtain independent legal advice prior to signing the Agreement. It is a requirement that the lawyers acting for each party must sign and annex a Certificate of Independent Legal Advice.
Operates for a maximum of 3 years.Final and operates until the children reach the age of 18 years. Can only be terminated with the consent of both parties, after receiving independent legal advice.

There are many considerations when deciding which agreement would be the best option for your circumstances. For example, if your employment is unstable or your income is prone to fluctuation, but you still want to formalise your Child Support arrangements for a defined period, then an LCSA may be best. This type of agreement can provide certainty regarding your payment obligations and can assist separated parents to navigate child support matters in the short term.

Alternatively, if your job is secure and your income is stable (or better yet, likely to increase substantially), then a BCSA may be best.

Other matters to consider when deciding what kind of agreement best suits your circumstances can include:

  • Are the care arrangements for the children going to stay the same, or will they change?
  • If the care arrangements for the children are likely to change, will the change be significant?
  • Will the primary carer of the children change from one parent to another?
  • If your financial circumstances change significantly, will you still be able to pay the rate of child support that you currently pay?
  • Are your circumstances likely to change in the future? For example, will you remarry? Will you have more children?
  • Are there any other dependents that you are financially responsible for that will not be covered by the private agreement?
  • Are you in good health and able to continue working to meet your financial obligations under the private agreement?
  • Do you and the other parent have an amicable co-parenting relationship? Can you navigate any changes to the agreement between you, or is there likely to be conflict?

Child Support is a complex area of law, and there are many factors to consider when determining what option is best for you. We strongly suggest that you obtain legal advice about your circumstances before you discuss a private agreement with the other parent. 

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