Child Support is a significant issue for separating parents. Considering how our notions of caring for and supporting our children have changed over the years, I was reminded of that old nursery rhyme of the old woman who lived in a shoe:
she had so many children she didn’t know what to do; she gave them soup without any bread and spanked them all soundly and sent them to bed.
We are so much more caring and aware of the need for adequate support for our children since the days of George II where this nursery rhyme is said to have originated.
These days, that old woman would have been charged with child abuse. We would be asking why she hadn’t been to the Child Support Agency to get assistance from the children’s father for their support.
Child Support Agencies
Not all separating parents require the assistance of the Child Support Agency to assess and enforce arrangements for financial support for the children.
Many parents make private arrangements to provide an appropriate level of financial assistance for their children under the age of 18 or remaining in full-time education without the intervention of an agency. These arrangements allow the parents to be in control of what level of support is needed for the children and what expenses each of the parents will meet.
Many parents enter into these arrangements on a formal basis, by utilising either a Limited Child Support Agreement or a Binding Child Support Agreement.
The difference between the two types of agreements is quite significant. In a limited agreement — which will only last for a three year period — there must be a Child Support Assessment in place and the amount agreed may not be less than the assessment. The agreement must be a written agreement and both parents must sign. There is no requirement for each party to obtain legal advice beforehand.
The document has no effect until it is registered with the Registrar of the Child Support Agency.
Either party can terminate the agreement after three years or if the notional assessment by the Registrar changes by more than 15 per cent. Either party may then elect to end the agreement. The agreement may also be terminated by entering into another Limited Agreement or entering into a Binding Child Support Agreement, perhaps if parental circumstances have changed; either through changed care arrangements, or a change to taxable income. A Court Order may also terminate the agreement. If no new agreement is in place, then support obligations will continue in the amount assessed by the registrar.
Binding Child Support Agreement (BCSA)
A BCSA is useful where each parent wants certainty over the level of and kind of financial support for their children. Binding Agreements require each party to receive legal advice, must be a written agreement signed by both parents and each parent’s legal advice should address the effect of the agreement on their rights and the advantages and disadvantages about how the terms of the agreement will impact upon them at the time they entered the agreement.
Binding Child Support Agreements are complex and designed to give the parties control over their financial arrangements. It’s not a requirement that there be a Child Support Assessment in place and the level of support may be any amount both parents agree. It may be less or it may be higher than an administrative assessment. It may include provision for yearly increases and a provision for one parent to meet certain expenses for the children, such as uniforms or school fees at a particular school.
Child Support Agreements, either limited or binding, should not be taken to be an “easy fix”. They are legally enforceable documents and may only be changed in most cases by future agreement between the parents or by complex court processes. Any parents considering whether a Child Support Agreement may be suitable for their particular circumstances should get legal advice first.