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Child support and child maintenance trusts

There are many ways that child support can be assessed and paid.  The basic Child Support Agency formula applies various details from the Australian Tax Office and information provided by the parents.  If parties consider special circumstances apply so that the formula is unjust, objection can be made to the Child Support Registrar and appeals from the Registrar’s decision are also available.

An adult child (or their primary carer) may, for reasons of health or study, also be able to apply for ongoing “adult child maintenance” payments from a parent.

A Limited Child Support Agreement can be entered into between parents which does not require legal advice or certification and will be binding for up to three years, save in various “significant” circumstances.  A Binding Child Support Agreement can also be entered into between parties.  These require certified legal advice and, if properly made, can only be overturned in exceptional circumstances.

One of the regular complaints about child support is that it is paid out of the payer’s after-tax income.  This need not be the case.  If the parties set up a Child Maintenance Trust to pay child support, child support can be paid from, for example, income from a business.  Child support payments can be made as assessed by the child support formula, or higher than the formula assessment, sometimes with much more favourable net tax outcomes for the payer.

Aitken Partners has Accredited Specialists in Tax Law and Family Law who can assist you in all areas regarding child support, Child Maintenance Trusts and adult child maintenance.  Few firms have this varied experience and we welcome any queries you may have regarding such matters.

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