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What does child support cover and do I need to pay a lot more? Child support blackmail

I have a few questions after some back ground info on my situation.

My wife and I separated 5 months ago after all trust was gone in our relationship. I had lied and not been open and truthful to her about our financial situation. She was at home with 2 babies under 2 and I couldn't bring myself to be honest about our situation and in turn bring more stress into her. Silly I know but it was all I could think of at the time (given that by mid December all of our major financial worries will be finalised).

What does child support cover? My wife wants what she thinks she deserves - that being the assesment as made by CSA plus an extra $130 per fortnight plus me to pay for exactly half of all expences other than rent and food for our 3 children. (These expenses include day care, primary school fees, clothing, afternoonand weekend sport and and activities).

I am slowly finding myself being blackmailed by her sob story of having no money to properly support the kids when I know for a fact after I have paid her child support she ends up with exactly the same amount of cash in her pocket as I do yet I am the one paying off our joint debts.

I am asking what does child support cover?

What have others done to resolve child support issues?

How hard is it to get a change of assesment made by the CSA?
If your wife is caring for young children and does not have any assets like a home etc.. and does not work them she will be getting the parenting payment single plus all related benefits like rent assistance, cheap car license medical etc…

If she has more than 65% care of the children then she will also get 100% of Family Tax Benefits. Child Support is meant to be for the children.

There is no real need for you to be paying anything extra unless the children have special needs, however your property settlement will have a great deal of influence on what you both believe to be a fair deal in regards to child support. If I was you I would not pay any extra monies until the property settlment has been finalised.

It is adviseable to consider child support when working out your property settlement as the it may keep you poor for the rest of your life after having lost 75% of your assets in the property settlement.

Resolving child support issues is not easy and the C$A is not on your side. They are more than just a collection agency and will try to squeeze as much as they can out of you having no regard for you or your children's interest.

The best way to deal with them to work through the appeals process the bext way you can to get to a court.
Liar no more said
I am asking what does child support cover?
As fairgo has said basically everything unless there are special circumstances. However saying that it is quite clear that it in fact pays for a great deal more at modest income levels. I have been on both sides of the fence, originally a payer and now, in theory a recipient and without receiving any CS but now having primary care there is a very noticeable positive financial difference.  
Liar no more said
What have others done to resolve child support issues?
Perhaps above answers this for my situation. In you situation as an newcomer to separation you may be able to take advantage of the ability, in the first three years, as recognition of the need to get your life back on track, you can work extra and earn more. If you wish to know more in regard to this, then check out the link to the relevant section of the CSA Guide.

The CSA Guide - 2.5.2: Additional income earned post separation
Liar no more said
How hard is it to get a change of assesment made by the CSA?
It can be very easy, as easy as doing nothing as the registrar (The CSA) can under some circumstances initiate a change of assessment on their own. In general from what I have experienced a major factor in how hard/easy a COA can be obtained is how much money can be claimed as having been collected or transferred (this equates to savings in FTB at the rate of 50c for a $1 collected or transferred).

If a change of assessment is likely to result in a reduction of money collected or transferred then you would very unlikely lose a bet that it would be far harder. Perhaps you should explain why you are asking this question, we could then perhaps provide some idea of what may happen.
Thanks for the advice so far. I will be putting a stop to my extra over payments in early January (I am putting it off so our first christmas as a seperated family can go as smoothly as possible). I am more concerned about the extra over expenses that my wife is asking me for. She says that we have equal share of raising our children and all expenses (clothing, schooling, including childcare when she has the children, all activities etc) should be shared equally.

I think child support should cover these?

what are my rights here in refusing to pay?

If I am paying child support and paying for half the expenses I will never be able to put together a home for our children for when that stay with me?

I am currently living in my mothers spare room and have been "Given" my clothes and basically anything she doesn't want from the house (DVD's etc)but as she puts it "you are not entitled to any furniture or anything other than your tools but don't even think about anything else"
LiarNoMore, basically unless there are special circumstances CS as assessed by the CS pays for everything. Exceptions are as per the change of assessment and there are 10 reasons. Below is an extract from the CSA's guide regarding the 10 reasons.

As for possessions(property) then I think that the best advice would be to look to taking the matter to court, as it is quite likely that you are entitled to a share of the possessions. Very briefly the process will most likely require an attempt at mediation, which may result in an agreed upon settlement (however this would appear to be unlikely considering what you have said that the other parent has said). If full agreement isn't reached at mediation, then it would be of to court.  I would strongly suggest that you have a look at the SRL-Resources and consider joining, you may then be able to get assistance to help you represent yourself in court.

Note that you would likely be going to court for both property and for contact. Note that anytime during the process you can both consent to orders.

CSA Guide - 2.6.2: What are the reasons for a change of assessment? said

2.6.2: What are the reasons for a change of assessment?

Version 2.1, Last updated 3 August 2009 5:00pm
Information in this version of The Guide applies from 1 July 2008
Refer to the previous Scheme Guide for information until 30 June 2008

Context

The 10 reasons for a change of assessment application are listed in the Assessment Act.

Legislative references

Sections 98C and 117 Child Support (Assessment) Act 1989

Contents

CSA can only change an assessment if one or more of 10 listed reasons is established 'in the special circumstances of the case' (sections 98C and 117(2)).

There are 10 reasons for a change of assessment (section 117(2)).

Reason 1. The costs of maintaining a child are significantly affected by high costs of enabling a parent to spend time with, or communicate with, the child.

Reason 2. The costs of maintaining a child are significantly affected by high costs associated with the child's special needs.

Reason 3. The costs of maintaining a child are significantly affected by high costs of caring for, educating or training the child in the way both parents intended.

Reason 4. The child support assessment is unfair because of the child's income, earning capacity, property or financial resources.

Reason 5. The child support assessment is unfair because the payer has paid or transferred money, goods or property to the child, the payee, or a third party for the benefit of the child.

Reason 6. The costs of maintaining a child are significantly affected by the high child care costs for the child (and the child is under 12 years of age).

Reason 7. The parent's necessary expenses significantly affect their capacity to support the child.

Reason 8. The child support assessment is unfair because of the income, earning capacity, property or financial resources of one or both parents.

Reason 9. The parent's capacity to support the child is significantly affected by:

    * their legal duty to maintain another child or person,
    * their necessary expenses in supporting another child or person they have a legal duty to maintain
    * their high costs of enabling them to spend time with, or communicate with, another child or person they have a legal duty to maintain.

Reason 10. The parents responsibility to maintain a resident child significantly reduces their capacity to support the child support child.

Prior to 1 July 2008, Reason 10 applied in cases where the child support assessment was unfair because the paying parent earned additional income for the benefit of a resident child.

If one of the reasons for a change of assessment is established, CSA must also consider whether changing the assessment would be 'just and equitable' and 'otherwise proper' (section 98C(1)).

You would be advised to start keeping a diary and if possible getting evidence of what the other parent is saying (jot down all of her remarks if spoken with date and time and mood in which they were said, better if you can get the other parent to write or use email). It is also very important that you are civil at all times.

You mention having nothing, the new legislation does allow parent's a period in which they can earn up to 30% extra than normal to assist them getting back on their feet. If you're able to work extra, then this may be an option that you could take advantage of.

Here's the relevant section of the guide that covers this.


The CSa Guide - 2.5.2: Additional income earned post separation said

2.5.2: Additional income earned post separation

Version 2.2, Last updated 13 October 2008 5:00pm
Information in this version of The Guide applies from 1 July 2008
Refer to the previous Scheme Guide for information until 30 June 2008

Context

A parent can apply to have extra income earned following separation excluded from their child support assessment.

Legislative references

Section 44 Child Support (Assessment) Act 1989

Explanation

What are the requirements for excluding additional income?

Additional income

The ordinary course of events

30% limit for reduction of adjusted taxable income

3 year limit on excluding additional income

When does a determination to exclude additional income apply?

Special Circumstances

Estimates of Income

Income or annual rate set

Non-ATO Incomes

Parents with more than one child support case

Parents who reconcile and re-separate

Non-parent carers

Revoking election to exclude additional income

Review rights

A parent can apply to have additional income that was earned after separation excluded from their adjusted taxable income for child support purposes in certain circumstances. A parent may apply to have additional income excluded, regardless of whether they pay or receive child support.

The exclusion of additional income post separation is limited to the first three years after the parents last separated before the start of the child support case.

What are the requirements for excluding additional income?

Parents of a child may apply to have additional income (earned, derived or received after separation) excluded from their adjusted taxable income for the calculation of their child support assessment.

The requirements for excluding this additional income are:

    * the parents must have lived together on a genuine domestic basis for at least six months (section 44(1)(a));
    * the last separation of the parents occurred before the application for administrative assessment was made (section 44(1)(b)(ii));
    * the last separation of the parents occurred within the last three years (section 44(1)(b)(i));
    * at the time of the application, the parents remain separated (section 44(1)©);
    * the income must have been earned, derived or received in accordance with a pattern of earnings that was established after separation with the other parent (section 44(1)(d)(i)); and
    * the income must be of a kind it is reasonable to expect would not have been earned, derived, or received by the parent in the ordinary course of events (section 44(1)(d)(ii)).

Additional income

Parents may earn additional income from a variety of sources, including for example, from overtime, a second job, a career change to a higher paying job, or from investment income. For a self employed person, additional income may be earned, derived or received through extending the opening hours of their business, increasing production or developing new markets or new products (to a greater extent than before separation). The parent must be able to show that the change that resulted in the additional income being earned happened after separation (section 44(1)(d)(i)).

The ordinary course of events

Not all additional income that is earned, derived or received after separation will qualify for exclusion from a parents adjusted taxable income. The new pattern of earnings must have been established after separation and would not have been reasonable to expect that income in the ordinary course of events (section 44(1)(d)(ii)).

Income that parents would have been reasonably expected to earn in the ordinary course of events can not be excluded from their adjusted taxable income. For example, it is within the ordinary course of events that parents will earn additional income through regular pay rises, or seasonal variations in income.

However, income that parents earn outside the ordinary course of events is able to be excluded from their adjusted taxable income. This could include income from overtime or second jobs taken on after separation, promotions or a shift to a higher paying job. However, moving from an unemployment benefit to employment is considered within the ordinary course of events. Any income to be excluded must have been earned in a pattern established after separation.

30% limit for reduction of adjusted taxable income

The exclusion of post separation income can not reduce a parents adjusted taxable income by more than 30% (section 44(3)(a)). If excluding all the additional income earned post separation would reduce the adjusted taxable income by more than 30%, CSA can only reduce the adjusted taxable income by 30%.

Example

F has an income of $30,000 at the date of separation from M. After separation Fs income increases to $60,000 as F takes on a second job. Fs child support liability is assessed on $60,000, as that was Fs income for the last relevant year of income. F can apply to have the additional income of $30,000 earned post separation excluded from their adjusted taxable income of $60,000, the extra $30,000 being additional income earned post separation. If Fs application is successful, Fs current income used in the assessment, $60,000, can only be reduced by a maximum of 30%, or $18,000. Therefore, Fs adjusted taxable income would be set at $42,000. F has $18,000 excluded from their income before the self-support component is deducted and Fs children receive child support based on an adjusted taxable income for F of $42,000.

Example

M has an income of $35,000 at the date of separation from F. After separation Ms income increases to $47,000 as M changes jobs. Ms child support liability is assessed on $47,000, as that was Ms income for the last relevant year of income. M can apply to have the additional income of $12,000 earned post separation excluded from their adjusted taxable income of $47,000.

If Ms application is successful a maximum of 30% of Ms current income could be excluded. However, 30% of $47,000 is $14,100 and a reduction of $14,100 would result in an adjusted taxable income of $32,900, a lower amount than the separation income. Therefore the adjusted taxable income would be set at $35,000, the separation income.

Three year limit on excluding additional income

Post separation income can not be excluded for more than three years from the date of separation (Section 44(3)(b)).

When does a determination to exclude additional income apply?

If CSA accepts an application to exclude additional income earned after separation this will ordinarily apply from the date the application was made. However, it can apply from the start of the child support period in which the application is lodged if there are special circumstances.
Special Circumstances

Whether there are special circumstances to justify backdating the exclusion of additional income will depend on the facts in each particular case. Generally CSA will be satisfied special circumstances exist where the parent was prevented from applying earlier but did apply in a timely way once they were able to, generally within 28 days.

The following are the circumstances in which a parent will be considered to have been prevented from applying earlier:

    * The income was not yet used in the assessment;
    * The parent was not aware of the existence of the child support assessment;
    * The parent was not aware of the existence of the provision because it was not discussed in their initial contact with CSA (where child support essentials are communicated), because, for example, that contact occurred prior to 1 July 2008;
    * The parent was a victim of family violence;
    * The parent (or a family member) was ill or had an accident that stopped the parent from applying;
    * The parent suffered a personal trauma such as a death in the family or a natural disaster that caused damage to the their property;
    * The parent had communication difficulties because of, or including, isolation, illiteracy or poor English-language skills;
    * The parents were involved in negotiations over child support and/or other matters and applying may have compromised those negotiations;
    * There are other exceptional circumstances.

The exclusion will remain in place until the end of the child support period. However, it will end sooner if the three year time limit (since separation) expires within the child support period.

A new application can be lodged for the next child support period if the other requirements are met and the three year time limit has not expired.

Estimates of Income

Parents who have lodged estimates of income may also apply for exclusion of post separation income (section 44(1)(d)). Where an estimate of income has been made, the CSA will consider excluding any additional income earned, derived or received in the remaining period for the purposes of the estimate of income, rather than additional income earned in the last relevant year of income.

Example

M had an income of $30,000 at the date of separation from F. Two months after separation Ms hours of work fall and they lodge an estimate of income of $20,000. Four months later M starts in a new job paying $38,000, M lodges a new estimate for that amount and the assessment is amended to use that amount.

M may also make an application to have the additional income earned post separation excluded from the new assessment. If CSA is satisfied that the section 44 requirements are met, CSA may make a determination that Ms adjusted taxable income will be $30,000 from the date of the application, as $8,000 is less than 30% of Ms estimated income of $38,000 (30% is $11,400). Ms adjusted taxable income could be set at $30,000, the separation income.

For more information about estimates of income, see 2.5.1 Estimates of Income.

Income or annual rate set

Where a parents annual rate or income for child support purposes is set by a court order, child support agreement, or change of assessment decision, the parent is able to apply for post separation income to be excluded from their adjusted taxable income. However, the income exclusion cannot start until after the court order, child support agreement, or change of assessment decision ceases to have effect. If the court order, child support agreement, or change of assessment decision covers the entire child support period, the application would be refused (section 44(5)).

Non-ATO Incomes

When a parents child support assessment is based on a non-ATO income, the parent may still be able to make an application to have post-separation income excluded from that income, provided that CSA is able to clearly identify the income that has been earned post-separation.

Where the income is a client supplied taxable income or an income that has been derived from information provided by the ATO, Centrelink or employers, it may be possible for CSA to identify additional income that has been earned post-separation. In those cases, CSA will check the income that is being used and make a decision as to whether the components of the income can be identified.

Where the components of the income cannot be ascertained, or where the income being used is a default income of at least 2/3 MTAWE, post-separation income will not be able to be identified and so cannot be excluded.

Parents with more than one child support case

Additional income earned after separation that has been excluded reduces the adjusted taxable income of the parent in only the child support case between the parents who separated - not any other case the parent may have (section 44(1)).

Parents who reconcile and re-separate

Reconciling and re-separating allows a new application for exclusion of post separation income only if during the last reconciliation the parents lived together in a genuine domestic relationship for at least six months (section 44(1)(a) and section 44(1)(b)). The additional income must have been earned after the last separation.

Non-parent carers

Parents with a child support case involving a non-parent carer are able to apply to exclude additional income earned after separation. The separation must have been between the parents of the child, not a parent and the non-parent carer.
Revoking election to exclude additional income

Once an election to exclude additional income has been accepted, it cannot be revoked. Therefore, if the parents no longer want the exclusion to apply they would need to make a child support agreement setting the relevant parents income at a higher level or specifying an annual rate of child support.

See Chapter 2.7.1 for more information on child support agreements.

Review rights

CSAs internal review (objection) process allows parents to ask CSA to formally reconsider particular decisions made under child support legislation.

If CSA refuses an application for exclusion of post separation income CSA will give the parent written notice of the decision (section 44(5)). If a parent is dissatisfied with this decision they may object to the particulars of the unchanged assessment.

If CSA accepts an application for exclusion of post separation income CSA will give effect to the determination by amending any administrative assessment that has been made in relation to the child support period. A parent who is dissatisfied with that decision may object to the particulars of the amended assessment. See Chapter 4.1 for more information on objecting to CSA decisions.
As MikeT said definitely at the very least make diary notations with dates, times and comments made. Even better SMS messages or emails. I was in a similar situation to you. I was paying way more than required (as I later found out). I was giving more and more in the mistaken belief that the children were benefiting. Anyway the X applied to the CSA and the amount I was paying was less through them. My X was livid when I started paying the amount that the CSA demanded and nothing more. Of course there was still the haircuts, new shoes etc whenever I had access, but, it was a hell of a lot less than i was paying in the start.
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