The Guides to Social Policy Law is a collection of publications designed to assist decision makers administering social policy law. The information contained in this publication is intended only as a guide to relevant legislation/policy. The information is accurate as at the date listed at the bottom of the page, but may be subject to change. To discuss individual circumstances please contact Services Australia.

2.4.5 Care, cost & child support percentages

Context

The basis for the child support formulas is the costs of the children. The formulas adopt an 'income shares' approach to calculating the costs of the child and sharing these costs between parents according to their relative incomes. Parents can contribute to or meet the costs of the child by providing care for the child.

Act reference

CSA Act section 35, section 49, section 50, section 54D, section 55C, section 55D

On this page

The care a parent provides directly for a child can be a contribution towards the costs of the child. The contribution a parent makes through care is determined by using step 4, 5 and 6 of the basic formula (2.4.7) (Formula 1 - section 35). These 3 steps are used to work out:

Percentage of care

A parent's or non-parent carer's care percentage is the percentage of care of the child the person is likely to have over the care period. A care period is generally a 12 month period, but may be shorter or longer than this in some circumstances (section 49 and section 50). See 2.2.1 for an explanation of how the percentage of care is determined.

A percentage of care must be rounded up to the nearest whole percentage if it is greater than 50% and rounded down to the nearest whole percentage if it is less than 50% (section 54D). This ensures that where more than 2 people have care of a child the combined percentages will never exceed 100%.

Example:

  • A percentage of care of 13.9% will be rounded down to 13%.
  • A percentage of care of 57.1% will be rounded up to 58%.

Cost percentage

A parent's cost percentage represents the percentage of a child's costs the person meets directly through care. A non-parent carer's cost percentage is used to calculate their entitlement to receive child support. The cost percentage is determined according to the person's percentage of care, using the cost percentages table (section 55C).

Percentage of care Cost percentage
0 to less than 14% Nil
14% to less than 35% 24%
35% to less than 48% 25% plus 2% for each percentage point over 35%
48% to 52% 50%
More than 52% to 65% 51% plus 2% for each percentage point over 53%
More than 65% to 86% 76%
More than 86% to 100% 100%

Example:

  • A percentage of care of 11% equates to a cost percentage of 0%.
  • A percentage of care of 19% equates to a cost percentage of 24%.
  • A percentage of care of 40% equates to a cost percentage of 35%.
  • A percentage of care of 50% equates to a cost percentage of 50%.
  • A percentage of care of 60% equates to a cost percentage of 65%.
  • A percentage of care of 81% equates to a cost percentage of 76%.
  • A percentage of care of 88% equates to a cost percentage of 100%.

Child support percentage

A parent's child support percentage represents the share of the costs of the child they are required to meet, based on their share of income, less their contribution to the costs of the child provided directly through care.

Each parent's child support percentage is worked out by subtracting the parent's cost percentage from their income percentage (2.4.7) (section 55D(1)). A parent's child support percentage is taken to be nil if the amount worked out is negative (section 55D(2)).

If a parent's child support percentage is positive, they are not meeting their entire share of the costs of the child (based on their share of the income) through care and must transfer that percentage of the costs of the child to the other parent by paying child support.

If a parent's child support percentage is negative, they are meeting more than their share of the costs of the child that they are required to meet through care, based on their share of the combined income. They are therefore entitled to receive child support, provided the other parent does not have more than 65% care of the child. See 2.1.1 for information about eligible carers.

Non-parent carers with a care percentage of at least 35%, do not have child support percentages, as their income is not used in child support assessments, and they can only ever receive child support. If there is more than one carer for a child, a non-parent carer's cost percentage can be used to distribute child support between the carers. See 2.4.8 for information about assessments with non-parent carers.

See 2.4.7 for an example of the basic formula, including the use of care, cost and child support percentages in steps 4, 5 and 6.

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