What types of child support are available?
We often encounter clients who wish to know whether seeking child support payments also means that the children’s health insurance, or school fees paid by the other parent will now stop being covered. There seems to be a common misunderstanding that child support must be paid in cash. Child support can be provided in cash and non-cash benefits.
Broadly, there are three types of child support arrangements commonly used by parents:
Informal agreement between the parents – this is not enforceable, however provides the greatest amount of flexibility;
Child Support Assessment by the Child Support Agency – this is calculated by the Child Support Agency ; using the parent’s income and time spent with the child among other factors;
Private Child Support Agreement – this is the perfect midpoint between an informal arrangement and a child support assessment, and allows for both flexibility in method of support and registration with the child support agency.
With respect to private child support agreements, payments can be periodic or non-periodic items, such as school fees or health insurance. If you have chosen to register your private agreement with the child support agency, you will be able to claim a portion of the value of the non-cash benefit towards the minimum amount of child support that the agreement must provide for.
Private Child Support Agreements can be made in two different way:
Binding Child Support Agreement; and
Limited Child Support Agreement.