What happens to a child support debt? 

A registered child support debt is a debt incurred by a parent that has an active case with the child support agency.

Child support debts never go away, regardless of the age of the children. If you or your ex partner currently have a registered child support debt, this debt will stay until the debt has been paid or if the owing parent passes away (however, there are recovery methods). 

A child support debt is incurred when a paying parent fails to make the weekly, fortnightly, and monthly payments to either the receiving parent or to the child support agency. For the purposes of this article, it will discuss registered child support matters which are managed directly by the child support agency. 

Upon separation, if a private agreement is not reached, one or both parents will apply to the child support agency for an assessment based on each parents previous year income. 

For the purposes of calculating child support, each parent has a ‘Child Support Income’. This child support income includes your taxable income minus the Self-Support Amount minus the costs of any dependents. 

The steps within the formula used to calculate the amount of child support that will need to be paid are as follows:

• Step 1 – Child support income
• Step 2 – Combined child support income
• Step 3 – Income percentage
• Step 4 – Percentage of care
• Step 5 – Cost percentage
• Step 6 – Child support percentage
• Step 7 – Costs of the child
• Step 8 – Annual rate of child support for the chil

An example of this formula can be found on the Child Support Agency website here.

How a debt is incurred?

Once a case is registered with the child support agency, if no payment is received from the paying parent, a debt is incurred. These failed payments attract late payment fees, payable to the child support agency. The debt remains on your file with child support until the payment is received, regardless of the child’s age. 

Payments that remain in arrears may be deducted from the paying parents tax return once lodged. This means that your arrears may be deducted from your expected return. 

Alternatively, the child support agency is able to investigate and locate your current workplace and arrange payments, with your work’s payroll department, of the debt to be taken out of your pay before it reaches your account. 

What can I do if I have a debt?

There are many avenues you can utilise to address your child support arrears. The following list provides a few options to consider (but is not an exhaustive list): 

1. Firstly, if it is possible, pay any amount you have in arrears outright. This can be done by contacting the child support agency and arranging payment over the phone. 
2. You can make an “extraordinary payment” to the receiving parent. This can be done by transferring money to the receiving parents bank account. You will then need to advise child support of the payment and lodge any proof of payment.
3. Arrange a payment plan with the child support agency. 

There are many ways to pay off your child support debt, so forgetting about it is not an option. 

Speak to our friendly law team today to see if we are able to help you with your child support inquiries.