Calculates your Australian Government Paid Parental Leave (PPL) payment, including the total amount, weekly rate, and number of payable weeks based on your income, due date, and how you plan to share the leave.
How Child Support is Calculated in Australia
Child support in Australia is administered by Services Australia and is calculated using a formula set out in the Child Support (Assessment) Act 1989. The aim is to ensure that both parents contribute financially to the costs of raising their children according to their respective capacities. The calculation considers each parent's income, the number and ages of the children, and the amount of care each parent provides.
The Key Components of the Formula
The formula involves several steps:
- Combined Child Support Income: The adjusted taxable incomes of both parents are added together.
- Cost of the Children: A basic cost is determined for the children based on their ages (0-12 or 13 and over) and the number of children. A multiplier is applied for multiple children.
- Self-Support Amount: An amount is deducted from each parent's income to represent the basic cost of supporting themselves. Only income above this amount is considered available for child support.
- Care Percentage: The percentage of nights each child spends with a parent in a year determines that parent's direct care costs. A higher care percentage reduces the cash support they may need to receive.
- Financial Resources: Each parent's income remaining after the self-support deduction is calculated. The proportion of the combined total resources each parent holds is determined.
- Cost Liability: Each parent's share of the combined resources is applied to the total cost of the children to find their financial responsibility.
- Transfer Amount: The final payable amount is the difference between a parent's cost liability and the cost of care they are already meeting. The parent with the higher liability after accounting for care typically pays the other parent.
Example Calculation
Consider Parent A with an income of $80,000 and Parent B with an income of $50,000. They have two children aged under 13. The children spend 14% of nights with Parent A and 86% with Parent B. The self-support amount is $28,640.
- Combined income: $130,000.
- Cost for two children (aged 0-12): $11,399 x 1.35 = $15,388.65.
- Parent A's care cost: 14% of $15,388.65 = $2,154.41.
- Parent B's care cost: 86% of $15,388.65 = $13,234.24.
- Parent A's available resources: $80,000 - $28,640 = $51,360.
- Parent B's available resources: $50,000 - $28,640 = $21,360.
- Combined resources: $72,720.
- Parent A's share: $51,360 / $72,720 = 70.6%.
- Parent A's cost liability: 70.6% of $15,388.65 = $10,868.39.
- Transfer from Parent A to Parent B: $10,868.39 (liability) - $2,154.41 (care cost) = $8,713.98 per year.
Therefore, Parent A would pay approximately $8,714 per year, or about $167 per week, to Parent B.
Common Scenarios
- Primary Carer with Lower Income: The higher-income parent, even with some care nights, will usually pay significant support to the primary carer.
- Shared Care (50/50): If incomes are similar, the transfer amount can be minimal or zero. If incomes differ, the higher-income parent may still pay the lower-income parent.
- High Care by Higher-Income Parent: If the higher-income parent has the majority of care nights, they may receive support from the lower-income parent, or no payment may be required.
Next Steps: Formalising Arrangements
Once you have an estimate, you may wish to formalise the arrangement. For a private agreement, a Parenting Plan can outline care and child support arrangements. If you need to formally request payments, a Child Support Demand Letter can be used. For a comprehensive agreement covering property and support, a Separation Agreement may be appropriate. Our calculator can help pre-fill relevant amounts in these documents.