2.7.1 What is a child support agreement?

Context

A child support agreement is a written agreement between parents (and/or a non-parent carer) on the amount of child support to be paid, and how it will be paid.

On this page

The child support legislation allows parents to reach agreement on the amount of child support to be paid. A child support agreement has to meet the requirements of the legislation and has to include matters that can be dealt with in a child support agreement. There are 2 types of child support agreement, binding child support agreements and limited child support agreements. Once parents have made a child support agreement, either parent can apply to the Registrar to have it accepted.

• Children for whom child support agreements can be made
• People who can be parties to a child support agreement
• Binding child support agreements
• Limited child support agreements
• Agreements that cover periods both before and after 1 July 2008
• What can be in a child support agreement?
• Other requirements of a child support agreement
• Agreements with conditions and pre-requisites
• Alterations to a limited child support agreement
• Alterations to a binding child support agreement
• Child support agreements and notations
• Apportioning amounts payable under child support agreements
• WA ex-nuptial cases

Children for whom child support agreements can be made

A child support agreement must be in relation to a child for whom an application for assessment can be (or has been) made. If a child support agreement deals with other children the Registrar will disregard those children for the purposes of the assessment (CSA Act section 82).

People who can be parties to a child support agreement

A child support agreement must be between:

• 2 parents of a child who would be able to properly make an application for administrative assessment of child support for the child in relation to whom the agreement is made (CSA Act section 83, section 25), or
• one or both parents of a child, and a non-parent carer of the child, who would be able to properly make an application for administrative assessment of child support for the child in relation to whom the agreement is made (CSA Act section 83, section 25, section 25A). If both parents are assessed for child support, then they must both be parties to the agreement.

In determining whether an agreement complies with the legislation, the Registrar may act on the basis of the application for acceptance of the agreement, the documents accompanying the application and the agreement itself. The Registrar is not required to conduct any inquiries or investigations into the matter (CSA Act section 91).

Binding child support agreements

Binding child support agreements operate in a similar manner to financial agreements that separating parents might make in relation to property, superannuation and spousal maintenance.

Each party to a binding child support agreement must have received independent legal advice before entering the agreement. This legal advice must be provided by a legal practitioner who has been admitted by the Supreme Court of a state or territory of Australia and holds a current practicing certificate. Legal advice will not be considered independent in circumstances where:

• one party (as a qualified legal practitioner) has provided legal advice to the other party to the agreement
• one party (as a qualified legal practitioner) has provided legal advice to themselves, or
• the same legal practitioner has provided legal advice to both parties.

In such cases, the Registrar will determine that the agreement is not a binding child support agreement under CSA Act section 80C(2). The parent who asked for the agreement to be accepted may wish to withdraw the application for acceptance and re-apply once independent legal advice has been obtained. Alternatively, the applicant could ask for the agreement to be accepted as a limited agreement. However, the rules for the acceptance of a limited agreement are different and may prevent the acceptance of the agreement. See Limited child support agreements.

A binding child support agreement must:

• be in writing, and signed by both parents or the parent/s and eligible non-parent carer
• include a statement that each party has received independent legal advice as to the effect and advantages and/or disadvantages of the agreement, before it was signed, and
• include an annexure, for each of the parties to the agreement, signed by the person who provided the legal advice, which certifies that the advice was provided (CSA Act section 80C).

There is no requirement for an administrative assessment to be in place prior to the making or acceptance of a binding child support agreement, except in cases such as binding agreements that create lump sum payment obligations under the CSA Act section 84(1)(e). A child support agreement can only be made between the parents of a child or between the parents and any non-parent carer eligible to be paid child support (CSA Act section 83). Therefore if there is no existing administrative assessment, the Registrar must also be satisfied that the parties to the agreement are parents or eligible non-parent carers before a binding agreement can be accepted. See 2.1.3 for information about when the Registrar will be satisfied as to parentage or 2.1.1 for information about eligible carers.

A binding child support agreement cannot be varied (CSA Act section 80CA). To change a binding child support agreement, the agreement must be terminated and replaced with a new binding child support agreement. For further information on how a binding child support agreement can be changed or terminated, see 2.7.5. For information on how a binding child support agreement can be suspended, see 2.7.6.

A document that forms a property division order, parenting plan, maintenance agreement or financial agreement under the FL Act, can also be a binding child support agreement for child support purposes if it complies with the necessary requirements in the CSA Act section 80C, section 82, section 83, section 84 and section 85 (CSA Act section 84(5)).

Transitional agreements

These are child support agreements that were made and accepted by the Registrar prior to 1 July 2008 and continue to have effect from 1 July 2008. These agreements are considered to be binding child support agreements. However, some different rules apply to these agreements as compared with binding child support agreements made and accepted by the Registrar after 1 July 2008 discussed above.

Further details about these agreements can be found in 2.7.4.

Transitional agreements also have different requirements for termination from other binding child support agreements (2.7.5).

Termination agreements

A termination agreement is a binding child support agreement entered into by the parties for the specific purpose of terminating the effect of an existing binding child support agreement.

Each party to the termination agreement must have received independent legal advice before entering into the termination agreement.

Limited child support agreements

Limited child support agreements allow parents some flexibility to determine their own child support arrangements. Limited child support agreements do not require the parties to have received legal advice before entering into the agreement.

For a limited child support agreement to be accepted by the Registrar there must be a child support administrative assessment in place at the time an application for acceptance of the limited agreement is received by the Registrar. Also, for the agreement to be accepted, the agreement must be for at least the annual rate of child support that would otherwise be payable under the administrative assessment, payable by the same parent as under the assessment.

Where an agreement includes the provision of an 'in kind' benefit, the Registrar may need to assign a value to that benefit in order to determine whether the amount in the agreement is at least the annual rate of child support that would otherwise be payable under the administrative assessment.

A limited child support agreement must:

• be in writing, and signed by both parents or the parent/s and eligible non-parent carer
• have an administrative assessment in place at the time an application for acceptance of the limited child support agreement is received by the Registrar
• meet the conditions set out in the CSA Act sections 80E(2), 80E(3) or 80E(4)
  • if the child support agreement commences on the day on which the application for acceptance of the agreement is made to the Registrar, the annual rate of child support payable by the parent under the agreement on the day of the application must be at least the annual rate that would have been otherwise payable by that parent under the administrative assessment on that day (CSA Act section 80E(2))
  • if the child support agreement commences on a day after the application for acceptance of the agreement is made to the Registrar, the annual rate of child support payable by the parent under the agreement on the day the agreement commences must be at least the annual rate that would have been otherwise payable by that parent under the administrative assessment on that day (CSA Act section 80E(3)). If the agreement commences on a day in the future for which the annual rate is not yet known, the agreement cannot be accepted until the annual rate on that day is known
  • if child support is payable under the agreement for a period of time before the day on which the application for acceptance of the agreement is made to the Registrar, the amount payable under the agreement for the whole period must be at least the amount of child support that would be otherwise payable by that parent under the administrative assessment for that whole period (CSA Act section 80E(4)).

If, when considering the annual rate or amount of child support that would otherwise be payable by the parent under the administrative assessment, there is a decision pending (for example, a change in care or income) that would affect the rate of child support otherwise payable on the day the application is made for acceptance of the agreement, the applicable rate or amount that applies under the CSA Act sections 80E(2), 80E(3) or 80E(4) will be the rate or amount under the amended assessment. The Registrar will therefore finalise the relevant decision before applying the test under the CSA Act sections 80E(2), 80E(3) or 80E(4).

Limited agreements cannot usually reverse the paying and receiving roles of the parents, as the annual rate payable by the paying parent under the agreement must be at least the rate payable by that parent under the administrative assessment.

However, if each parent has the paying role in relation to one of their children, because of different care arrangements for the children, an agreement made in relation to one of the children may cause the overall roles to reverse after the higher agreement amount is offset against the assessment amount for the other child under the CSA Act section 67A.

A limited child support agreement cannot be varied (CSA Act section 80F). To change a limited child support agreement, the agreement must be terminated and replaced with a new limited child support agreement. For further information on how a limited child support agreement can be changed or terminated, see 2.7.5. For further information on how a limited child support agreement can be suspended, see 2.7.6.

A document that forms a property division order, parenting plan, maintenance agreement or financial agreement under the FL Act, can also be a limited child support agreement for child support purposes if it complies with the necessary requirements in the CSA Act sections 80E, 82, 83, 84 and 85 (CSA Act section 84(5)).

Agreements that cover periods both before & after 1 July 2008

(The information under this heading applies to ex-nuptial children residing in Western Australia from a later date than for other cases. See 1.3.2.40 for details of the date from which various provisions had effect for WA ex-nuptial cases.)

Some child support agreements lodged with the Registrar on or after 1 July 2008 will affect child support assessments for periods prior to 1 July 2008, as well as periods from 1 July 2008. In these circumstances, the child support agreement will be treated as 2 separate child support agreements, one for the period prior to 1 July 2008 and the other for the period from 1 July 2008.

The pre-1 July 2008 legislation will apply to the first child support agreement, for the period prior to 1 July 2008. The current legislation, as outlined in this topic, will apply to the second child support agreement, for the period from 1 July 2008 (item 16 of schedule 6 of the Families, Housing, Community Services and Indigenous Affairs and Other Legislation Amendment (2008 Budget and Other Measures) Act 2008). Rules about acceptance of the agreement in relation to the value of the agreement, where applicable, will be applied separately to the 2 agreements, rather than looking at the value for the entire period.

What can be in a child support agreement?

A child support agreement can only be made in relation to specific matters listed in the CSA Act.

A child support agreement must contain at least one of the following provisions (CSA Act section 84(1)):

• provisions under which a parent is to pay child support for a child to another person in the form of periodic amounts paid to the other person (CSA Act section 84(1)(a)) (periodic amounts to be paid to the other person)
• provisions varying the rate at which a parent is already liable to pay child support for a child to another person in the form of periodic amounts paid to the other person (CSA Act section 84(1)(b))
• provisions agreeing on any other matter that may be included in an order made by a court under Division 4 of Part 7 (CSA Act section 84(1)(c))
• provisions under which a parent is to provide child support for a child to another person otherwise than in the form of periodic amounts paid to the other person and those amounts are to reduce the annual rate of child support payable by the parent under the child support assessment (CSA Act section 84(1)(d)) (non-periodic payment provisions)
• provisions that a parent is to provide child support for a child to another person in the form of a lump sum payment (including by way of transfer or settlement of property) and that payment is to be credited against the parent's child support liability under the child support assessment (CSA Act section 84(1)(e)) (lump sum payment provisions)
• provisions under which a parent is to provide child support for a child to another person otherwise than in the form of periodic payments that are not non-periodic or lump sum payment provisions (CSA Act section 84(1)(f)) (other payments and benefits)
• provisions under which a parent's liability to pay or provide child support for a child to another person is to end from a specified day (CSA Act section 84(1)(g)) (a provision to end a child support liability).

If the agreement contains provisions of a type not set out above, the Registrar will disregard these provisions in making an assessment (CSA Act section 84(3)).

A single child support agreement can contain different provisions for different child support periods or different parts of child support periods (CSA Act section 84(2)).

For agreements made from 1 July 2018, the agreement is not a child support agreement if it provides for a party to pay child support to another party who is not an eligible carer of the child (CSA Act section 85(1)).

Periodic amounts to be paid to the other person

A child support agreement can provide for periodic amounts (regular amounts payable on a regular basis) to be paid to the other parent or non-parent carer.

These may be paid directly to the other parent or non-parent carer, to their bank account, or to a third party acting as the agent of the payee, such as a solicitor or trustee.

A periodic amount can be adjusted for the costs of living by either the child support inflation factor (2.4.2) or the CPI (3.4.3) or another adjustment factor identified by the child support agreement.

A provision that requires the payer to make payments to a third party (such as a school) on behalf of the payee is not a provision for a periodic amount to be paid to the other person. A provision of this kind may be a non-periodic provision (see example below).

Non-periodic payment provisions

Where a child support agreement provides for child support to be paid otherwise than in the form of periodic amounts it may state that the annual rate of child support payable under the administrative assessment is to be reduced by a specified amount or percentage (up to 100%), which represents the annual value of the child support payable under the agreement (CSA Act section 84(1)(d) and section 84(6)).

If the child support agreement does not specify how the amounts will reduce the child support payable, then they are not amounts under the non-periodic payment provisions in the CSA Act and will not reduce the annual rate of child support payable under the administrative assessment (see 'Other payments and benefits' below).

Lump sum payment provisions

Where a child support agreement provides for child support to be paid in the form of a lump sum:

• it must be a binding agreement
• it must state the lump sum payment is to be credited against the amount payable under the administrative assessment
• there must be an administrative assessment in force prior to the application for acceptance being made
• the amount of the lump sum must equal or exceed the current annual rate of the administrative assessment
• the lump sum will be credited at the rate of 100% of the child support payable (unless the agreement specifies a lesser percentage).

Note: The lump sum payment is credited against the payer's liability under CSRC Act section 69A (rather than reducing the annual rate of child support payable under the administrative assessment). As at 1 July each year, the remaining lump sum credit is indexed in accordance with changes in the CPI (5.3.3).

Other payments & benefits

A child support agreement may include provision for child support to be provided otherwise than in the form of periodic amounts, but not specify how that payment is to reduce the child support payable (CSA Act sections 84(1)(d) and 84(6)) nor specify that it is a lump sum payment that is to be credited against the child support assessment liability (CSA Act section 84(1)(e)).

An agreement may also include a provision for child support other than in the form of monetary payment, for example, the provision of goods or services.

If the provision does not meet the requirements of either a non-periodic payment provision (CSA Act section 84(1)(d) and section 84(6)) or a lump sum payment provision (CSA Act section 84(1)(e) and section 84(7)) it may satisfy the requirements of CSA Act section 84(1)(f).

If the agreement does specify the provision of goods, services, other payments or benefits then those arrangements will not have any effect on the child support assessment. The goods, services, payments or benefits conferred under the provision of the agreement will be in addition to any administrative assessment.

The additional goods, services, payments or benefits cannot be enforced or collected by the Registrar.

A provision to end a child support liability

A child support liability, whether started by child support agreement or formula assessment, can be ended by a child support agreement which provides for a liability to end from a specified day. The end date can be express or implied.

When the specified day arrives the Registrar will end the assessment from that day (a 'terminating event' under the CSA Act section 12(4)). A provision to end a child support liability does not prevent either parent from applying for an assessment in the future.

Other requirements of a child support agreement

The parties can sign the same child support agreement, or each sign separate copies of a child support agreement. Where the parties each sign separate copies, the terms of each copy must be identical.

If a child support agreement is made in the same document and deals with more than one child, the Registrar may treat it as if it contains separate agreements for each of the children (CSA Act section 87(1)).

If a child support agreement provides that child support is to be paid by or to both parents or 2 or more parties to an agreement, such as between parents and a non-parent carer/s, the Registrar has the discretion to treat it as if it contains separate agreements made in relation to the child or children by each of the parties, depending on the circumstances of the case (CSA Act section 87(2)). Whether a decision is made to treat the document as containing 2 separate agreements will depend on the facts of the case and the document being presented to the Registrar.

Agreements with conditions & pre-requisites

The commencement of a child support agreement may be contingent on finalisation of certain family law matters in the Federal Circuit and Family Court of Australia. Alternatively, the rate of child support payable under the agreement may be conditional upon those matters being finalised.

If an agreement contains conditions or pre-requisites, the parties will need to provide evidence to the Registrar to confirm that the condition or pre-requisite has been met. If evidence is not provided, the Registrar may determine that the agreement does not contain a relevant provision for the payment of child support (CSA Act section 84(1)), that the agreement is not 'properly made' and refuse to accept the agreement.

The Registrar may accept an agreement which states the rate of child support payable under the agreement will vary depending on whether a condition or pre-requisite has been met.

Alterations to a limited child support agreement

Parties must sign identical documents to make a valid child support agreement. Any alterations must be initialled by both parties to show that they were made before the agreement was signed.

If an alteration is not initialled, or is only initialled by one party, and the parties confirm the alteration was made before the agreement was signed, then the parties have signed identical documents and the altered agreement is valid. If an alteration was made after one, or both parties signed the agreement and they want the altered agreement to have effect, any alterations must be initialled by the parties and the agreement signed again for the altered agreement to be valid.

If an alteration is not initialled, or is only initialled by one party and there is a dispute between the parties as to whether the alteration was made before or after an agreement was signed, the Registrar must decide whether they signed an identical document. If both parties signed an identical document before an alteration was made, the Registrar can accept the original agreement without taking account of the alteration. If the alteration was made after the agreement was signed by one party but before it was signed by the other, the parties did not sign the same document and there is no agreement between them.

Alterations to a binding child support agreement

Alterations to a binding child support agreement can only be made with legal advice, statements and certificates being obtained by both parties before they initial any changes.

Child support agreements & notations

An order for a change to the assessment made by consent under CSA Act Part 7 can sometimes contain notations, notes or annotations to draw attention to actions the parties have taken or will take in the future. Notations are not orders and cannot be registered as court ordered variations to an assessment. However, they can form a child support agreement if:

• they are signed by both parties (the usual provisions for limited and binding agreements apply), and
• the wording of the notation expresses an agreement that child support of a kind listed in the CSA Act section 84 is payable to the other person.

A notation that says the parties intend to make a child support agreement is not a child support agreement.

Recitals

A child support agreement may contain information in the form of recitals. Recitals are usually statements setting out the facts and background to the making of the agreement and often include a statement indicating the intention of the parties. Recitals are often helpful when interpreting the agreement if there is any ambiguity in the clauses and words used in the operative clauses. While recitals do not form part of the operative clauses of an agreement, the agreement can state that they are to form part of the agreement.

Apportioning amounts payable under child support agreements

From 1 July 2018, where a child support agreement:

• is made in the same document in relation to 2 or more children, and
• does not explicitly provide the amount payable under the agreement in relation to each of the children and it is not possible to work out the amount payable

the agreement is taken to provide that the total amount payable under the agreement in relation to each child is worked out using the following formula (CSA Act section 86A).

• Total amount payable under the agreement ÷ The number of children to whom the agreement relates

Apportioning under the CSA Act section 86A only applies in relation to any event that causes an agreement to cease to relate to a child, occurring on or after 1 July 2018. An agreement ceases to relate to a child where there is a suspension or termination of the agreement in relation to that child, or where the agreement ceases to be in force because of a terminating event (for example, the child turns 18).

If the agreement ceases to relate to a child, the amount worked out using the formula continues to apply in relation to each of the remaining children under the agreement (CSA Act section 86A(3)).

For agreements made before 1 July 2018, the total amount payable under the agreement is the total amount payable immediately before 1 July 2018. The total number of children the agreement relates to is the number immediately before 1 July 2018. The apportioned amounts for agreements made before 1 July 2018 is preserved.

WA ex-nuptial cases

The information on this page applies to WA ex-nuptial children. For information on when provisions apply for WA ex-nuptial cases, see 1.3.2.40 for changes to the CSA Act.