A written agreement between parents or carers of children about the payments to be made to support their children is called a child support agreement. Child support can be made in all sorts of ways, e.g. direct payment of a set amount to one of the parents/carers into their nominated bank account each week, payment to a school for their fees, payment to medical funds for health insurance, or payment to providers of extra-curricular activities. All of these payments made on behalf of the children can be used to partially or completely offset the child support you might be liable to pay.
“Binding” Child Support Agreements
For the written agreement described above to be legally binding each party must have received independent legal advice about the advantages and disadvantages of entering into the agreement, prior to entering into the agreement. It is not necessary to ask the Child Support Agency to prepare an assessment of the payer and it is possible to enter into an agreement which describes a party paying child support to another party which is less than the amount assessed by the Child Support Agency, although we do recommend that you access the Human Services website to give you some guidance about the child support payable if you were assessed by the Child Support Agency. Except where the agreements are set aside as described below, the agreements only expire on the youngest child reaching the age of 18, or entering into a de facto relationship. You should also each receive a copy of the agreement once it has been signed.
It is difficult to set aside a binding child support agreement – agreements can only be set aside if obtained by fraud, or if exceptional circumstances have arisen since entering into the agreement, such that a parent/carer will suffer hardship if the agreement is not set aside. Exceptional circumstances are generally only met where something has happened which is unexpected, such as one of the parties has substantially increased their care of the children.
“Limited” Child Support Agreements
Limited child support agreements are also written agreements, but are more flexible than binding child support agreements. They generally involve “non-periodic”, or irregular payments made directly to a parent/carer, or on behalf of children to third-party providers such as schools and medical funds. There must be a child support assessment already in place and the annual amount payable must be equal to or more than the mount assessed. You are not required to get legal advice before entering into a limited child support agreement.
Limited child support agreement are easier to set aside and can be done at the election of one of the parties after the expiration of three (3) years. Agreements can also be set aside, when one of the parties’ incomes has decreased by more than 15%.
Lump Sum Child Support Agreements
It is possible to have child support paid in a lump sum, where the payer has repeatedly failed to make periodic payments, although courts are reluctant to exercise that power, for fear that the money might be spent immediately and not be properly allocated for the long term benefit of the children.
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