5.3.1 Non-agency payments
Context
When the Registrar registers a child support liability for collection, the amounts payable become a debt to the Commonwealth and are payable to the Registrar (CSRC Act section 30). A carer liability is a debt to the Commonwealth under CSRC Act section 69B and is payable to the Registrar (5.5.5).
In some circumstances, the Registrar may credit payments made directly to a payee or to a third party against a child support liability registered for collection or a carer liability. The Registrar may also credit the value of non-cash payments or the provision of services in the same way. These credits are known as 'non-agency payments'.
Act references
CSRC Act section 71, section 71A, section 71B, section 71C, section 71D
CSRC Regs section 19
On this page
- What is a non-agency payment?
- Was the payment in respect of an enforceable maintenance liability or carer liability?
- Was a payment made?
- How is a non-cash payment valued?
- Was the payment intended to be in lieu of child support payment or carer debt?
- Election to have a non-agency payment made to a third party credited towards less than 100% of the relevant liability
- Credit against future liabilities
- Prescribed non-agency payments
- Discretion to refuse to credit an amount
- Objections
- Other options
- What happens to a credit if the liability is no longer payable to the Registrar or an assessment has ended?
What is a non-agency payment?
A non-agency payment is one of the following types of payment.
- A payment made directly to a payee of an enforceable maintenance liability or to a payee of a carer liability (CSRC Act section 71)
- A payment to a third party in discharge of a debt owed by the payee or payer of the enforceable maintenance liability or carer liability, or both (CSRC Act section 71A)
- A non-cash transaction, such as a transfer of property or the provision of services, taken to be an amount paid under the enforceable maintenance liability or carer liability (CSRC Act section 71B)
The Registrar can credit a non-agency payment to a child support debt or carer debt if, at the time the payment was made, the payer and the payee both intended that it was a payment towards the enforceable maintenance liability or the carer liability, except if the liability is an agency reimbursement liability (CSRC Act sections 71(3), 71A(4)).
The legislation also provides for prescribed payments under CSRC Act section 71C. If the payment was of a kind specified in section 19 of the CSRC Regs (known as a prescribed payment), the Registrar can credit the payment up to a maximum amount that is equal to 30% of the amount payable under the payer's child support liability for the period, only if:
- the payer of an enforceable maintenance liability has made one or more payments to the payee of the liability or to another person
- the payment is a payment of the kind specified in section 19 of the CSRC Regs
- the sum of those payments exceeds the sum of all such payments previously credited under this section against the liability for all past periods
- at the time the payment was made, the payer has less than 14% care of all of the children to whom the relevant administrative assessment relates
- at the time the payment was made, the child support liability was not being fully or partially met by a lump sum credit (CSRC Act sections 69A, 71C(2) and 71C(5)(b)), and
- the liability is not a recovery order or spousal and de facto maintenance order (CSRC Act section 71C(5)(a)), or a registrable overseas maintenance liability (CSRC Act section 71C(6)).
Further information about prescribed non-agency payments is provided under prescribed non-agency payments.
Was the payment in respect of an enforceable maintenance liability or carer liability?
The Registrar can credit payments if the payment was made in respect of an enforceable maintenance liability or a carer liability. This includes non-agency payments made for arrears on ended cases.
Example: Blythe is liable to pay child support to the Registrar from 1 April 2020, which is the date that Trevor applied for collection. On 13 April 2020, Blythe asks the Registrar to credit $200 paid directly to Trevor on 30 March 2020. Blythe and Trevor intended the payment to be for child support for April. The Registrar cannot credit the payment under section 71 of the CSRC Act. At the time of payment, there was no enforceable maintenance liability and the payment was a private payment to the payee.
Example: Morris was liable to pay child support of $200 per month to the Registrar until Petra opted for private collection on 1 May 2020. At that time, Morris had an overdue child support amount of $800, which remained enforceable. On 2 June 2020, Morris asks the Registrar to credit $600 paid directly to Petra on 1 June 2020. Morris and Petra intended the payment to be for child support for the month of May and for overdue child support. At the time of payment, Morris had a liability of $200 for May, which was not enforceable as the liability was raised during the private collect period. The remaining $400 of the payment can be credited against the overdue amount under section 71 of the CSRC Act, as the overdue amount is an enforceable maintenance liability. After the Registrar has credited the $400 against the overdue amount, Morris now has a remaining enforceable maintenance liability of $400.
The Registrar cannot credit a non-agency payment against a liability that is an agency reimbursement liability (3.6.2) (CSRC Act sections 71(3) and 71A(1A)).
Was a payment made?
The Registrar can only credit a non-agency payment if the amount has actually been paid or transferred. The Registrar will not credit the value of goods that the payer intends to transfer at a later time, or where the payer has allowed the payee use of those items.
Example: Cosmo, the payer, advises the Registrar that he has given his car to Margit, the payee, and that he wants the value of the car to be credited against his child support liability. Margit advises the Registrar that she agrees to the credit, but mentions that the car is still registered in Cosmo's name because he cannot transfer the ownership while he is paying it off. The Registrar does not credit the value of the car, because Cosmo still owns it. The Registrar suggests that Cosmo and Margit discuss a value for the use of the car and, if they can reach agreement, ask the Registrar to credit this on an ongoing basis.
If a payer and payee disagree about whether a cash payment was made, or on the amount of the payment, the Registrar will ask for evidence of the payment. The Registrar will decide, on the basis of all the evidence, whether or not a payment was made and the value of the amount paid.
Acceptable evidence includes bank statements, cheques or receipts. The Registrar will also consider oral or written statements provided by both parents.
Example: Jordan, a payer, advises the Registrar that they paid $350 directly to the payee, Flora. When the Registrar asks Flora to confirm the payment, Flora denies receiving it. Jordan then supplies a bank statement, which shows a direct debit from Jordan's account to an account at the same branch. The Registrar contacts Flora to discuss this evidence. Flora admits she received the payment, but says she believed it was from another source.
Example: Alex and Vincent agree that Alex, the payer, will pay $200 per month towards Vincent's monthly loan repayments and that Alex's payment is intended to be payment for child support. Vincent then supplies a bank statement and advises the department that Alex has been regularly redrawing funds of $100 per month from the loan account. The department contacts Alex, who agrees that payments have been withdrawn. The Registrar determines that payments of only $100 per month have been made as non-agency payments.
How is a non-cash payment valued?
Where parents agree about the value of a non-cash payment (for example, a transfer of property or a service provided), the Registrar will use this agreed value (CSRC Act section 71B(2)(a)).
Where parents cannot agree about a value, the Registrar will decide an amount (CSRC Act section 71B(2)(b)). The Registrar will first try to negotiate an agreed amount with both parents. If this fails, the Registrar will request further information from the parents to determine a value.
Further information could include an independent valuation from a professional valuer (for real estate, etc.), or a letter from a local real estate agent estimating the market value of the property when it was transferred, or a local council valuation. Where the non-cash payment involves the transfer of a motor vehicle, the information sought could include a valuation from a car yard or local garage, or a list of prices showing the approximate value of an equivalent model. The Registrar can seek a receipt for items recently purchased.
Was the payment intended to be in lieu of a child support payment or carer debt?
The Registrar will accept a parent's advice that a payment received or the value of goods or services provided by the other parent were intended as a payment towards child support or a carer debt.
Where the parents disagree, the Registrar will seek evidence from both parents and decide, on the basis of that evidence, whether the relevant intention existed when the payment was made.
The Registrar will seek oral statements (or written, if either parent cannot be contacted by telephone) from both parents about their intention at the time the payment was made and the circumstances surrounding the payment. Before making a decision, the Registrar will discuss the evidence with both parents, so that they have an opportunity to respond or expand on their statements.
If the Registrar cannot obtain a statement from one of the parents, the Registrar will consider a statement made by the other parent and any other available evidence.
In making a decision, the Registrar will take into account the following factors:
- Whether the parents have agreed that previous payments made in similar circumstances were for child support, as this may indicate the same intention in relation to the present payment.
- The circumstances in which the payment was made. For example, where a payer has made payments or provided goods as part of a contact visit, this may have occurred without the prior knowledge or consent of the payee.
- Any documents that support the case of either parent. For example, if there were legal proceedings in progress at or before the time of the payment, there may be relevant documents which refer to payments made by the payer to the payee or a third party.
- Sometimes the notations on a court order will refer to the payment of expenses. While notations are not part of the court order, they may support the proposition that a parent has agreed that they are separately or jointly responsible for certain payments.
- Whether one of the parents has previously stated that payment was to be credited, but subsequently changed their statement. The Registrar will examine both statements to determine what their intention was at the time the payment was made.
Example: The payer Marta advises of payments of $2,500 for school fees and clothing. Marta claims a credit for that amount under CSRC Act section 71A.
Scenario 1: The payee Toni agrees that the amounts were paid with the intention that they be credited against Marta's child support liability. The Registrar credits the total amount of $2,500.
Scenario 2: Toni states that only an agreed amount of $2,000 was intended to be credited against Marta's child support liability. Toni says that Marta agreed to pay $500 to cover half the cost of school uniforms and that this amount was in addition to Marta's usual child support. Marta is contacted and confirms that arrangement. The Registrar credits an amount of $2,000, a partial credit of the original $2,500 claimed.
Scenario 3: The payee Toni states that the amount should not be credited, as the payments were additional to Marta's ongoing child support liability. Toni claims that there was no agreement or intention on Toni's part that the school fees and clothing would be in lieu of child support payments to the Registrar. Toni later sends in a copy of their property settlement, which included a clause that Marta would pay all school fees and associated costs until their child turns 18 years of age. The amount is not credited. (Note: The Registrar's discretion to refuse to credit this as a prescribed payment under section 71D of the CSRC Act would also be exercised).
Example: The payer Owen asks for payments totalling $300 to be credited. The total is made up of several amounts including a trip to the zoo, computer games and a pair of sports shoes.
The payee Morgan states that the payments were not intended as child support payments and that the child already had a perfectly good pair of sports shoes. Morgan states that there has been no discussion regarding footwear and the child has said that the shoes were a birthday present from Owen. Morgan contends that the trip to the zoo and computer games were also birthday presents.
Owen then agrees that some items were for the child's birthday but contends that the cost of the shoes ($150) should be credited as the child needed them.
There is no evidence that Morgan intended that the shoes were to be credited as child support. The amount claimed is not credited. Owen is advised that Morgan's agreement should be sought before purchasing similar items in the future.
Election to have a non-agency payment made to a third party credited towards less than 100% of the relevant liability
Parents can apply to have an amount paid to a third party credited against an enforceable maintenance liability or a carer liability (CSRC Act section 71A).
For amounts paid against an enforceable maintenance liability on or after 1 July 2008, the payer and the payee can agree to specify a percentage (that is less than 100%) at which the ongoing liability will be met by the third party non-agency payment (CSRC Act section 71A(2)). The percentage agreed to by the payee and payer cannot be changed after the non-agency payment has been accepted.
The agreed allocation percentage does not affect the overall amount to be credited. Rather, the agreed allocation percentage changes the rate at which the amount is credited against the liability. The third party non-agency payment will be applied against the ongoing liability at the specified percentage as the liability is raised each month until the credit is fully allocated.
Example: The payer Lee applies for a third party payment of $500 to be credited to his account. The payee Taylor states that she agrees that the payment was made in lieu of child support, however, she requires some periodic child support payments while the credit is being absorbed. Lee and Taylor agree to have the payment applied at the rate of 50% of the ongoing liability, and payer Lee will pay the other 50% of the ongoing liability, so that Taylor will still receive 50% of her child support as periodic payments.
If the parents cannot agree to a lesser percentage, the third party non-agency payment will be applied against 100% of the liability.
Example: Payer Olivia applies for a third party payment of $500 to be credited to her account. The payee Dennis states that he agrees that the payment was made in lieu of child support, however, he requires some periodic child support payments while the credit is being absorbed. Dennis asks for it to be applied at the rate of 50% of the ongoing liability. Olivia does not agree, therefore, the credit is applied against 100% of the liability.
If a non-agency payment is to be credited against 100% of the liability, it is applied against any child support outstanding and the remainder against future liabilities during the same child support enforcement period as they are raised.
For amounts paid against a carer liability, the payer and the payee can agree to specify a percentage (that is less than 100%) at which the liability will be met by the third party non-agency payment (CSRC Act section 71A(2)). The percentage agreed to by the payee and payer cannot be changed after the non-agency payment has been accepted.
Example: Sam, the payer of the carer liability, applies for a third party payment of $500 to be credited against the $500 carer liability that she owes to Ewan, the payee of the carer liability. Ewan states that he only agrees that the payment was made in partial satisfaction of the carer liability, as he requires an amount of cash to meet his other expenses. Sam and Ewan agree to have the third party payment applied at the rate of 60% of the carer liability and Sam pays the remaining 40% to the Registrar in cash, which is then disbursed to Ewan.
Credit against future liabilities
Where an amount (whether cash, property or provision of services) is credited as a non-agency payment satisfying an enforceable maintenance liability, any remaining excess amount can be applied against future amounts payable under the same enforceable maintenance liability during the same child support enforcement period, where this is consistent with the expressed intention of both the payer and the payee.
See prescribed non-agency payments for information about how uncredited amounts can be applied for these types of payments.
Where an amount is credited as a non-agency payment satisfying a carer liability, any remaining excess amount is disregarded and cannot be applied against future carer liabilities or enforceable maintenance liabilities.
Prescribed non-agency payments
The Registrar can credit certain payments towards a payer's child support liability regardless of the intention of the parents at the time the payment was made (CSRC Act section 71C), except if:
- the liability is an overseas maintenance liability (CSRC Act section 71C(6))
- the liability is a recovery order, or for spousal or de facto maintenance (CSRC Act section 71C(5)(a))
- at the time the payment was made, the payer had at least regular care of any of the children to whom the relevant administrative assessment relates (CSRC Act section 71C(1)(ba)), or
- at the time the payment was made, the child support liability was being fully or partially met by a lump sum credit (CSRC Act section 71C(2)) (refer to 5.3.3).
Credit can be given up to a maximum of 30% of the liability, provided:
- the balance of child support is paid as it becomes due and payable
- the payer has less than 14% care of all of the children to whom the relevant administrative assessment relates at the time the credit is being applied (CSRC Act section 71C(1)(d)), and
- the child support liability is not already being met by a lump sum credit (CSRC Act section 71C(5)(b)).
The balance can be paid in cash or in the form of a non-agency payment credited under CSRC Act sections 71 or 71A, or from money credited from another source such as a tax refund or payment from a third party.
The Registrar can only credit amounts paid on or after 1 July 1999.
The types of payments that can be credited in this way are prescribed by regulation (CSRC Act section 71C(1)(b) and CSRC Regs section 19). They are:
- child care costs for the child who is the subject of the enforceable maintenance liability
- fees charged by a school or preschool for that child
- amounts payable for uniforms & books required by a school or preschool for that child
- fees for essential medical and dental services for that child
- the payee's share of amounts payable for the payee's home, and
- costs to the payee of obtaining & running a motor vehicle, including repairs & standing costs.
If the payer satisfies the conditions and the prescribed non-agency payment is accepted, the Registrar can credit up to 30% of the current liability from the date of notification of the payment. If the amount of the payment is more than 30% of the enforceable maintenance liability in a given month, the excess amount will be retained as an 'uncredited' amount. This uncredited amount can be applied against the payer's enforceable maintenance liability in a later month provided the conditions for payment are again met, and can be carried over to a different child support enforcement period as long as it relates to the same liability.
The Registrar cannot credit an uncredited amount towards any child support arrears that accumulated prior to the payer notifying the Registrar of the prescribed payment. An uncredited amount can be applied to arrears that accumulate after the notification, but only when at least 70% of the liability is satisfied by cash or a non-agency payment credited under CSRC Act section 71 or 71A.
Example: A payer has a current liability of $100 per month and owes $3,000 in arrears.
In August 2013 the payer notifies the Registrar of a prescribed payment of $2,000 made that month, however, has not made any payments directly to the payee or to the Registrar.
As a result, the payer still owes $3,000 and has an uncredited amount of $2,000. This is because the prescribed payment cannot be applied to the arrears ($3,000), which accumulated prior to notification of the payment, and at least 70% of the current liability ($100) has not been paid.
If the payer pays $70 in cash (or has an equivalent amount credited as a non-agency payment under CSRC Act sections 71 or 71A) by the due date for August 2013 (7 September 2013), then $30 from the $2,000 uncredited amount is credited towards the current liability of $100. The arrears of $3,000 remain. The uncredited amount is reduced to $1,970.
If the payer does not pay for the months of August, September, October and November but pays $280 on 7 December 2013 (being 70% of the liabilities for August, September, October and November 2013), then $120 of the uncredited amount can be credited (that is, 4 × $30, leaving a balance of $1,880) and the arrears remain at $3,000.
If the payer instead pays $1,000 on 7 December 2013, $280 of the cash payment (70% of the liability) is applied to the liabilities raised for August, September, October and November (that is, $400) and $120 of the uncredited prescribed payment would be credited to the account. This leaves an uncredited balance of $1,880 and the cash payment in excess of 70% of the liabilities, being $720, is credited against the original arrears of $3,000.
If a retrospective variation is made to a liability, whether it results in an increase or a decrease, the amount credited from a prescribed payment remains unchanged despite the fact that the percentage of the prescribed payment has changed.
If the Registrar is collecting child support through employer withholding, the amount deducted will be adjusted to take into account the prescribed payments. If the prescribed payment constitutes 30% of the payer's liability for 2 months or less then the excess cash will be refunded. If the prescribed payment constitutes 30% of the liability for a period greater than 2 months, the payer will be given the option of having their deductions reduced or given a cash refund.
Payees who are in receipt of FTB Part A above the base rate need to be made aware that when the Registrar notifies the Secretary of a prescribed payment, the payment will be included in the MIT used to calculate FTB, even though it remains 'uncredited' for the Registrar's purposes. The whole amount will be assessed on the day that the payment was made to the third party or received by the payee.
Regular care of children and/or liability being met by a lump sum credit at the time the prescribed payment was made
From 1 July 2008, a payer cannot claim a credit under CSRC Act section 71C when, at the time the payment was made:
- they had at least 14% care (more than below regular care) of any of the children to whom the administrative assessment relates, and/or
- the child support liability is being fully or partially met by a lump sum credit (5.3.3).
If a parent applies to have a prescribed non-agency payment credited, and the above circumstances did not exist at the time the payment was made but exist at the time of the application, the application will be accepted. However, the payer will not receive the benefit of the 30% credit against their monthly liability until those circumstances again cease to exist.
Example: The payer Samuel asks for a payment of $1,000 to be credited as a prescribed non-agency payment on 20 November 2019. The payment was for school fees for Samuel and Yuki's children and was made on 8 July 2019, at which time Samuel had below regular care of both children. Samuel currently has below regular care of one of the children and regular care of the other child.
The amount claimed is accepted as a prescribed non-agency payment, as Samuel had below regular care of both children at the time the payment was made. However, Samuel will not currently receive the 30% credit against his ongoing liability as he now has regular care of one of the children. If, in the future, Samuel again has below regular care of both children he will start to receive the 30% credit against his ongoing liability.
Payments made prior to 1 July 2008 but advised to the Registrar on or after 1 July 2008 will be accepted and credited, regardless of the level of care the payer has of any of the children at the time of applying for the prescribed non-agency payment to be accepted.
Child care costs for the child who is the subject of the enforceable maintenance liability
A payer can claim credit for amounts paid for child care, less any child care subsidy or additional child care subsidy that is deducted from the child care fees.
Fees charged by a school or preschool for a child who is the subject of an enforceable maintenance liability
This can include school fees and levies, but not payment for non-compulsory camps, excursions, additional tuition or boarding costs. A school is an institution that mainly provides primary or secondary education.
It includes an institution providing technical and further education where the payment is for a course of secondary education.
Amounts payable for uniforms & books required by a school or preschool for a child who is the subject of an enforceable maintenance liability
From 12 April 2001, a payer can claim credit for books and uniforms required by a school that the payer has obtained from any source. (The Registrar could previously only credit an amount paid for uniforms and books that the payer purchased from the child's school or preschool.) Amounts payable for books includes textbooks and exercise books but not stationery, computers, etc. Amounts payable for uniforms includes a school bag if prescribed by the school.
Fees for essential medical & dental services for a child who is the subject of an enforceable maintenance liability
Essential medical and dental services are not limited to those services provided in an emergency.
A payer can claim only their actual costs. The Registrar will credit only the net amount after any rebate the person can claim from Medicare or a health insurance fund.
Prescribed payments include essential consultation fees for services provided by medical and dental practitioners, treatment by specialists, eye testing, X-rays, pathology tests, examinations and certain 'out-of-hospital' surgical procedures by Medicare approved practitioners. The cost of medication associated with essential treatment is also included, as well as equipment such as crutches or a vaporiser.
Prescribed payments include 'in-hospital' costs either as a public patient, or as a private patient in a public or private hospital. Costs can include accommodation and items such as theatre fees, anaesthetist costs, pathology, X-rays and medicines.
Prescribed payments may also include fees for medical or dental services not covered by Medicare, if they are essential for the child in the opinion of a practitioner approved by private health funds. These services include:
- emergency ambulance services
- physiotherapy
- speech and eye therapy
- chiropractic services
- podiatry
- psychological services
- optometry and repairs.
The Registrar will not allow a credit for fees for surgery or dentistry performed solely for cosmetic reasons. Where there is doubt, a parent can ask the service provider for more information.
Examples: The cost of a nose reconstruction carried out by a cosmetic surgeon purely for cosmetic reasons would not be acceptable as a 'prescribed' payment. However, the cost of a nose reconstruction which alleviated a breathing difficulty or was performed following an accident would qualify.
The cost of orthodontic work performed solely for cosmetic reasons will not qualify as a prescribed payment. However, if a general practitioner or orthodontist indicated that the work was necessary for the child's psychological wellbeing or essential dental health, it may be justified.
The payee's share of amounts payable for the payee's home
This includes:
- the payee's share of amounts payable for rent or a security bond for the payee's home
- the payee's share of amounts payable for utilities, rates or body corporate charges for the payee's home, and
- the payee's share of repayments on a loan that financed the payee's home.
Payments for utilities include gas, electricity, water and telephone, including the home phone portion of any phone / internet / mobile package.
Prescribed payments can only be made in relation to a home in which the payee lives and for which the payee is jointly or solely responsible. However, a bill for utilities does not need to be in the payee's name.
Prescribed payments can only be made for repayments on a loan that financed the payee's home where the payee is named on the mortgage documents and is liable for repayments on the loan.
Where the payer makes payments for the payee's home, for which they and the payee are jointly responsible, the Registrar will credit only the payee's share. In the absence of evidence to the contrary, this will be half the total amount.
Example: The parents separate in March 2019 and the payee continues to live in the home they shared. The home has gas connected, which is in the payer's name because the payer had originally organised the connection when they had moved into the home. The payer pays a gas account (which is in the payer's name) of $500 in November 2019, which covers the period from 1 July 2019 until 30 September 2019. The payee and children were residing in the home and thus solely benefited from the payment of the gas bill. The payer applies for credit of this $500 as a prescribed non-agency payment. The Registrar will credit this amount.
Example: Payer Theo and payee Nenne hold equal shares in the home in which Nenne continues to live. Theo applies to have payments for electricity and council rates credited as prescribed non-agency payments. Both bills have been issued in Theo's name. As Theo and Nenne are jointly liable for payment of council rates, the Registrar will credit 50% of the payment, being Nenne's share of the payment. As Nenne is solely liable for payment of the electricity account, the Registrar will credit 100% of the account as a prescribed payment.
The Registrar can only credit a prescribed non-agency payment if the amount has actually been paid or transferred. If a payer and payee disagree about whether a payment was made, or the amount of the payment, the Registrar will ask for evidence of the payment. The Registrar will decide, on the basis of all the evidence, whether or not a payment was made and the amount paid.
Example: Caspar, a payer, advises that they are paying monthly repayments of $500 on a mortgage for the home in which the payee Ariel lives. As Ariel is named on the mortgage documents as having an equal share in the property, the Registrar agrees to credit the payee's share of the loan repayments ($250) as prescribed non-agency payments. Ariel then supplies a bank statement and advises that Caspar has been regularly redrawing funds of $200 per month from their mortgage account. The Registrar contacts Caspar who agrees that payments have been withdrawn. The Registrar determines that payments of only $300 per month have been made and will credit the payee's share ($150).
Costs to the payee of obtaining & running a motor vehicle, including repairs & standing costs
For vehicle costs to be considered as prescribed non-agency payments, the payee must have an obligation to pay the costs of obtaining and running the motor vehicle. This includes payments that are necessary to keep the vehicle on the road and to maintain its safety. For example, for service, repairs, tyres, registration and compulsory insurance premiums, as well as non-compulsory insurance premiums where the payee is an existing contributor. If the payee is a party to a loan or lease agreement for a vehicle, the costs may include the payee's share of lease payments or loan repayments.
Example: Goran, the payer, pays leasing costs for a leased car that is used by Riley, the payee. The lease agreement is between Goran and the lease company. As Riley is not a party to the lease agreement, they have no legal obligation for the leasing costs of the car. Goran's costs cannot be a prescribed non-agency payment because Riley has no legal obligation to pay for the costs of obtaining the motor vehicle.
Example: Blake, the payer, lets Skye, the payee, use one of his cars to shuttle their children to and from school, after school activities, medical appointments and other day-to-day activities. Blake owns the car and it is registered and insured in his name. Blake's costs of running the motor vehicle cannot be a prescribed non-agency payment because Skye has no legal obligation to pay those costs.
Discretion to refuse to credit an amount
The Registrar can refuse to credit a non-agency payment claimed under CSRC Act sections 71, 71A or 71C if the Registrar is satisfied that, in the circumstances of the particular case, the amount ought not to be credited (CSRC Act section 71D).
The Registrar may refuse to credit an amount in certain circumstances, including, but not limited to, the following:
- The payee's agreement to credit an amount paid to a third party or payment made as a transfer of property was obtained through coercion or harassment. (However, where the Registrar is informed about this after the payment has been credited, it will be necessary for the payee to object to the Registrar 's decision to credit the amount.)
- The payer is claiming a credit under CSRC Act section 71C for an expense they regularly meet that was taken into account in a change of assessment decision. For example, the Registrar or a court has reduced the annual rate (or refused to increase it) because the payer usually pays school fees, medical expenses for the child, mortgage or rent payments or any other prescribed payments.
- The payer is claiming credit under CSRC Act section 71C for an expense which they have undertaken to pay in addition to their liability as specified in an agreement between the parents (this does not have to be a child support agreement).
- The payer is claiming credit under CSRC Act section 71C for an expense that they are responsible to pay under the terms of a court order.
- The payer is claiming credit under CSRC Act section 71C for expenses for the child for which they are separately responsible. For example, the payer claims credit for child care costs for the days when the child resides with the payer. If the payer claims credit for a payment for which they and the payee are jointly responsible, and the amount does not relate to the payee's home, the Registrar has no basis of apportioning the payment and must credit the full amount. However, if there is evidence that the parents have explicitly agreed about how much each party will pay, the Registrar will apportion responsibility according to their agreement.
- The payer is claiming a credit under CSRC Act section 71C for loan repayments and they have a history of regularly withdrawing funds from the loan account using its redraw facility.
Example: Oliver, a payer, advises that they have recently paid $2000 towards private school fees for the child. Annalise does not agree that the parties intended this payment to be in lieu of child support. The Registrar agrees to credit this as a prescribed non-agency payment. Annalise then supplies emails in which Oliver agreed to take over payment of the private school fees in full. Oliver confirms the arrangement was made because Annalise could no longer afford to pay the fees and was going to remove the child from private education. The Registrar determines that in the circumstances Oliver is separately responsible for payment of the school fees and refuses to credit the amount.
Example: Basil, a payer, advises that they have paid $1,000 in orthodontic expenses for essential dental treatment for the child. Rodya does not agree that the parties intended the payment to be in lieu of child support. The Registrar agrees to credit the entire amount as a prescribed non-agency payment. Rodya then supplies a written payment plan which shows the parties agreed for Basil to pay 60% and Rodya to pay 40% of the orthodontic costs, and receipts showing that $1,000 was the total out-of-pocket expense. The Registrar determines that payment of only $400 should be credited, as Basil was responsible for payment of the other $600.
Objections
A payee can object to the Registrar's decision to credit a non-agency payment under CSRC Act section 71, 71A or 71C (CSRC Act section 80).
A payer and a payee can object to the Registrar's decisions to refuse to credit all or part of a non-agency payment under CSRC Act section 71, 71A or 71C (CSRC Act section 80).
Other options
If a non-agency payment is not credited, there may be other options available to the payer, such as:
- applying for a variation to a court ordered liability (2.8.1 and 4.3.2)
- applying for a change of assessment under CSA Act Part 6A (2.6)
- applying for a departure order under CSA Act Part 7 Division 4 (4.3.2)
- applying for an order under CSA Act Part 7 Division 5 to have non-periodic or payments to third parties credited against an assessment (4.3)
- making a child support agreement under CSA Act Part 6 providing for non-periodic amounts or payments to third parties to be credited against an assessment (2.7).
What happens to a credit if an assessment has ended or the enforceable maintenance liability is no longer payable to the Registrar?
Note: The information below relates to non-agency payments only. It does not apply to uncredited amounts for prescribed non-agency payments under CSRC Act section 71C, which can be carried over to a new child support enforcement period for the same liability.
If an enforceable maintenance liability or assessment ends with uncredited non-agency payments, these amounts will be disregarded. An uncredited amount paid within one child support enforcement period cannot be applied to future amounts that become payable in a different child support enforcement period. For example, uncredited non-agency payments cannot be carried over where:
- the parents make an election to end collection, and later make an application to resume collection
- a parent moves to a non-reciprocating jurisdiction, and later returns to Australia or a reciprocating jurisdiction, or
- parents re-separate after a period of reconciliation.
Uncredited non-agency payments also cannot be carried over where there is a change in circumstances (for example, change in care or income) which creates a role reversal. A role reversal results in the payee becoming the new payer, and the payer becoming the new payee. An uncredited amount paid in respect of an enforceable maintenance liability cannot be credited towards a carer liability, and vice versa.
If a subsequent role reversal occurs and a parent returns to their previous role, an earlier uncredited amount cannot be credited towards their new liability as it is associated with a different child support enforcement period.
When the Registrar receives an election to end collection, the parents will be notified if there are any uncredited non-agency payments on the child support account. Similarly, the Registrar will notify the parents of any uncredited non-agency payments on the child support account when the Registrar requires the child support payee to make private arrangements to collect their child support.