Parents who separate or divorce, will have to consider the continued financial wellbeing of their children when their relationship breaks down. This article looks at the financial aspects of separation and looks to answer the very debated question: what does Child Support cover?
Broadly speaking, Child Support, governed by the Child Support Agency (the ‘CSA’) and the Child Support (Assessment) Act, aims to provide ongoing financial support for children of separated parents until the child or children reach the age of 18.
Child Support aims to cover the following broad expenses:-
- Housing costs;
- School costs;
- Medical costs;
- Extra-curricular activities; and
How parents reach an amicable solution as to how much child support is to be paid by either party to the other, depends on the state of the relationship after its breakdown. In most cases there will be a payer and a payee – the former typically calculated to have more income and/or less time with the children and the latter with less income and more direct time with the children.
The Child Support Agency
Usually, the first port of call for parents is the CSA who provide online estimators to calculate how much Child Support needs to be paid.
The Child Support Agency has designed a formula that takes into account each parents circumstances to determine what amount of child support is to be paid.
The CSA use a calculator that takes into consideration the following items:-
- The number of dependent children the payer and payee parent has
- How old the children are (Child Support continues until 18)
- How much time each parent cares for the children
- The income of each of the parents
The formula does not include an allowance for private school fees or health insurance premiums.
Once a final figure is reached for how much child support should be provided, parents then have the choice to pay the agreed figure directly to the payee privately or they can use CSA services. The CSA can provide CSA Collect whereby the child support agency collects and transfers payments between the parties.
If you believe that your child support contributions (or receipt) is unfair, you can either use your legal team or apply to the CSA to consider special circumstances that might include:-
- The child support assessment does not reflect the true financial position of either party – one party has not disclosed their real financial position
- Accessibility and cost of spending time with a child needs evaluation – separated parents who live miles away and thereby cannot spend as much time with their children and/or travel costs are prohibitive
As discussed earlier within this article, child support covers the main areas of food, housing, school, medical, extra-curricular fees and clothing but there will naturally be items that sit outside these categories and these will require further negotiation.
However, the Child Support (Assessment) Act also provides for two types of agreements that set or alter the amount of child support to be paid which can also to take things into account such as:
- payment of private school fees;
- payment of uniforms, books and extra-curricular-activities;
- payment of private health insurance;
- additional costs due to the ‘special needs’ of a child.
The two types of Private Child Support Agreements include:
- Limited Child Support Agreements; and,
- Binding Child Support Agreements.
In order to be enforceable, private child support agreements need to meet very specific legal requirements. To learn more about these requirements, view our FAQs or alternatively you may contact us to discuss your matter.