Donate Child Support Calculator
Skip navigation

CSA and moving jobs

Moving from a Salaried job to Starting my own business

Hi All,

I am in the process of moving from a salaried job (15 years service and fed up with it) to starting my own business, this would result in a decrees in my Child Support Payments until the business picks ups.

Does any one have experience on how to go about estimating income?, informing CSA? etc, what has been CSA's response to this? would I still have to pay or accrue a debt till my business income equals my current salaried wage?

Thanks



Unfortunately the advice, based upon how the CSA have acted in regards to small businesses, is don't do it.

You could be the subject of what is often termed "change of assessment" (correct legal name is a departure from formula based assessment) and more specifically a reason 8 - a parent's income, property, financial resources, or earning capacity(what some have termed "Deem and Destroy"). Note that the registrar (the CSA) can initiate a reason 8. Recourse to corrective action is limited (you object, that is likely turned down, you take the matter to SSAT (Social Security Appeals Tribunal), they will likely make matters even worse (it is believed that SSAT is saturated with ex CSA staff who are very used to twisting the legislation to maximise what they collect in theory)., the last recourse is to take the matter to court but only on a matter of law.

The earning capacity if applied would very likely be met and if so at best the CSA would be likely to say that you have the capacity to earn what you were previously earning:


From 1 July 2006, the Registrar can only determine that a parent's earning capacity is greater than is reflected in his or her income used in the child support formula if all of the following three matters are satisfied:
The CSA Guide - Reason 8 - a parent's income, property, financial resources, or earning capacity 2.6.14 said
1. The parent is either:

    not working despite ample opportunity to do so (section 117(7B)(a)(i)); or
    has reduced his or her weekly hours of work to below full-time work (section 117(7B)(a)(ii)); or
    has changed his or her occupation, industry or working pattern (section 117(7B)(a)(iii));

AND

2. The parent's decision about his or her work arrangements is not justified by either:

    his or her caring responsibilities (section 117(7B)(b)(i)); or
    his or her state of health (section 117(7B)(b)(ii));

AND

3. The parent has failed to show that the decision about his or her work arrangements was not substantially motivated by the effect this would have on the child support assessment (section 117(7B)©.

However,
            the above is only 1 facet of reason 8. Basically even though not qualified as a judge or magistrate, they are given the powers of a judge or magistrate.

As for estimating income, if a change of assessment is in place you can't (income amount order is the result of change of assessment).

The CSA Guide - Income estimates for a year of income 2.5.1 said
When can a parent estimate their income?

An income estimate can be made if:

    there is no income amount order in force on the start day of the election or in the remainder of the financial year (sections 60(6) and 63(2A)); and
    in the case of a first election for a year of income  if the estimate is 85% or less than the persons adjusted taxable income for the last relevant year of income (section 60(1)(b)). The adjusted taxable income is based on the parents taxable income and must be:
        as advised by the Australian Taxation Office; or
        where the parent is a resident of a reciprocating jurisdiction, as advised by the relevant overseas authority (section 58C);
        a declaration by the parent of their adjusted taxable income which the Registrar is satisfied is correct (section 60(1)(b)(ii));
    later income estimate elections for a year of income can be made at any time within that year of income, and the amount estimated may be higher or lower than the previous estimate (section 62A).

Note: the components of a persons adjusted taxable income changed as of 1 July 2009 (see Chapter 2.4.4).


However, assuming that you are not subject to a change of assessment then the advice is to frequently submit income estimate amendments ensure that the last is accurate. If your estimate is lower than 10% of your actual taxable income then penalties will be applied. If it is higher then you can say goodbye to the overpayment.

I'd suggest a long and careful study of the relevant section of the guide. Here's some links:

The CSA Guide - Reason 8 - a parent's income, property, financial resources, or earning capacity 2.6.14
Income estimates for a year of income 2.5.1

With regard to your last question about accruing a debt, it is very likely that you would and that debt is a debt to the commonwealth and the CSA's top priority is to get that paid.
Wow, thanks MikeT for your comprehensive answer.

This is very disconcerting, but if you are not earning the money how could C$A keep over estimating???
at what point do C$A realise that you just dont have the money, does this means that are you not able to change jobs??,

what if I go for a stay order till I go through the process??

Surely this not the first time this has happen to people on this forum?

Has any one moved jobs?? … anyone …. ????
My ex moved from a 80k per year job to a 40k per year job. His ex put in a COA and claimed he had the capacity to earn 80k so should still be assessed on that higher amount.

Long story short but CSA found in our favor that the job change was not a deliberate ploy to reduce child support, so number 3 (of what MikeT posted above) could not be satisfied.

3. The parent has failed to show that the decision about his or her work arrangements was not substantially motivated by the effect this would have on the child support assessment (section 117(7B).

The only thing going for us was that my ex worked away and worked very long shifts, so we were able to claim the stress from this lifestyle was taking it's toll (our doctor backed this up). The ex took it to SSAT and we won there as well. 

I don't know anything about starting a business but am guessing you will need some kind of justification for lowering your income if your ex applies to have you assessed on your capacity to earn. Why are you fed up with your job?, is it causing any health effects that you could get a doctor to back up?

We acquired an 6k debt while we went through the process which took 10 months. When CSA found in our favor the debt was wiped. A stay order might be the go.  
Thanks Frenzy, did the doctor put your ex on a health plan? or just provided a medical certificate/letter? Can medical records be accessed by the SSAT??

Last edit: by halo_dad

Yes, I have moved from similar job to similar job.  How ever During the "Global Financial Crisis" a lot of work dried up meaning I went from 80k odd per year to 25k per year. They attempted to keep over estimating me on 80k until I made a big stink about it. They ended up contacting my employer and asking why I wasn't getting the same hours etc etc.  

Otherwise being terminated from your job is also another event that they cannot fight against. However they will and did ring my ex employer and tried telling them to re-employ me.   :lol:    I decided then to take 18 months of for some re-skilling and they had issues with that as well. They tried saying there was plenty of work in what I was doing, unfortunately they seem to be out of touch on what is happening in many industries at the moment.

But otherwise if you don't provide them with the information that they are going to accept as genuine for a reduction in income, they seem to just go for the line that you are trying to minimise your CS.
Then will Bill you at your former income.

Just keep jumping up and down till they listen.

Otherwise by the end of it go to your Dr and get him to do your BP, while you think about the craziness of the CSA  and I'd say your doctor will write you a certificate and recommend taking time off/career change because you'll be in a hypertensive state and moving towards a coronary.
CSA rang my partners former employer as well. They actually asked medical questions - which I found out later they had no right to ask! Employer told them basically to p/off.

Our Doctor filed in a medical cert that we found on the CSA website, stating that the long work hours, driving, work environment ect where likely to effect my partners mental and physical health in the long run. The Doctor did not go as far as to state that my partner could not keep working in that position/environment.

However, according to SSAT, even though he did not leave for health reasons as per number (2)(doctor would have had to say he could not work in that position due to such and such a condition) he had every right to consider his long term health, along with other factors, when deciding to change jobs.

So basically he used the Cert from the doctor to back his claim that he wasn't motivated to reduce child support, that-one of his reasons was a desire to protect his long term health.

My partners ex tried to get SSAT and CSA to send my partner to a Doctor for another opinion, they told her they have no legal right to do that. They cannot by law over ride medical opinion.
halo_dad said
Surely this not the first time this has happen to people on this forum?

Has any one moved jobs?? … anyone …. ????

  Halo dad, if you read some of my posts on this forum you will see how the CSA/SSAT and the FM courts have screwed me over because I am self employed.
If you and your ex-partner are communicating well then a private agreement may be the way to go. Your ex-partner need only contact child support to stop collections. Once contacted then child support are not able to collect anything. Collection is based only on a request to collect from the person with the children.
kalimnadancer said
If you and your ex-partner are communicating well then a private agreement may be the way to go. Your ex-partner need only contact child support to stop collections. Once contacted then child support are not able to collect anything. Collection is based only on a request to collect from the person with the children.
What reasons would a Payee want to make a private agreement when they would move from a position of some certainty and collection arm of Government doing the collecting. The number of private agreements is large and I often wonder what sort of deal is struck that would entice Payees to move away from Child Support collect.

In  respect to giving up a job to work from home or start a business that is fraught with great uncertainty and significant problems if a Change of Assessment arises as income determination often ends up with "is the amount to pay fair and reasonable" regardless of what you earn… .  Wait until the children have exited the CS scheme and you will have a stress free life. It may be different if you have any sort of arrangement with your ex, set out, written down and signed up that specifically includes CS. My experience is that once you go and start to acquire company assets such as new vehicles, plant and equipment, buildings etc regardless of what you borrow, the ex partner sees that as money you should have spent on CS and the inevitable COA will then cause a lot of grief. During that process the CS system will send all your financial information to the ex.


Executive Secretary - Shared Parenting Council of Australia
 Was my post helpful? If so, please let others know about the FamilyLawWebGuide whenever you see the opportunity
 
Thanks SPCA,

I was wondering I have 2 clauses inserted in our settlement which states :

" That other than as provided for in these orders, each party shall be sole owner the the exclusion of the other party of the following -
- any interest in any saving accounts, investments ore superannuation funds standing in their respective sole names;
-Any shareholding, debentures, units in unit trust, stocks or interest in any company standing in their respective sole names"
as at the date of the making of these orders.

"That each of the parties s solely liable and hereby indemnifies the other in relation to any debt, liability or claim in their respective names not otherwise referred to in these orders as at the date of these Orders."

what impact would this have on disclosure of information on the COA be? should I provide company asset details? where does CSA stand with with these orders for indemnification.  O_o
1 guest and 0 members have just viewed this.

Recent Tweets