Repayment of Child Support

Child support is a critical component of family law in Australia, designed to ensure that children receive adequate financial support from both parents, regardless of the relationship between the parents. Regulated by Services Australia, the system provides for the calculation, payment, and (where necessary), repayment of child support. This article explores the legal framework surrounding repayment of child support in Australia, including key legislative provisions, common scenarios triggering repayment obligations, enforcement mechanisms, and legal remedies available to parties in disputes.

Disputes over parentage

There is usually some certainty over the identity of a child’s birth mother, but there is sometimes doubt over the identity of the other parent. Broadly speaking, if a person is in a relationship with the birth parent at the time of the birth, or if they are listed as a parent on the birth certificate, then Services Australia will presume they are the parent. If the birth mother names someone as a parent, but they are not the spouse or on the birth certificate, there is a higher onus on the birth parent to establish parentage.

A person who receives an order to pay child support should make these payments, even if they have doubts about their parentage of the child. What they can do is dispute the order by applying to the court for a declaration that they should not be subject to assessment because they are not the child’s parent. This application must be made within 56 days of the date of service of the Registrar’s decision to impose child support obligations. In such cases, the court may order paternity testing. If the birth parent refuses to comply with the testing order, then the court may draw an inference that the testing result would not help their case. Should the court be satisfied that the person disputing parentage is not in fact the parent, it may grant a declaration that effectively voids the child support application. In that circumstance, the payer may be able to recoup previous child support payments.

In cases where a person has paid child support for someone that is not their child, the court will look at multiple issues when deciding whether to make an order for repayment, such as:

• whether the payer or payee suspected, knew, or ought to have known that the payer was not the parent,
• whether either party acted (or failed to act) in a way that caused the Registrar to accept the application for child support assessment,
• whether the payer delayed in applying for a declaration once they knew (or ought to have known) that they were not the child’s parent,
• whether there is the potential for child support to be obtained from the actual parent of the child,
• the payer and payee’s financial circumstances; and
• the nature of the relationship between the payer and the child.

It is unlikely that the court will order repayment of any voluntary child support made prior to an administrative assessment.

Overpayments

The amount of child support to be paid can either be agreed privately between the parents or can be calculated by Services Australia. Under the Child Support (Assessment) Act 1989, a child support assessment is based on:

1. the income of both parents
2. the percentage of care each parent provides to the child, and
3. the costs of raising a child, adjusted for the number of children involved.

When the amount of child support is set by Services Australia, there is the possibility that overpayments of child support might occur. Section 71 of the Child Support (Registration and Collection) Act 1988 permits recovery of overpaid child support. Repayments are typically pursued if the payer can demonstrate that they have paid more than their assessed liability. For instance, an overpayment may result from circumstances such as administrative errors, changes in the income of either parent, changes in the child’s living situation, or the arrival of new children for either parent.

Overpayment due to administrative errors

Administrative errors, such as incorrect income assessments or calculation mistakes may result in overpayment. For instance, if the payer is assessed to pay $1,000 per month but pays $1,200 due to departmental error, the overpaid $200 may be subject to repayment.

Changes in income or circumstances

Child support obligations are dynamic, reflecting changes in the financial or personal circumstances of either parent. For example, if a paying parent’s income decreases substantially, and they fail to update their details promptly, they might overpay based on an outdated assessment. Conversely, if a receiving parent earns significantly more than disclosed, a retrospective adjustment may lead to repayment obligations. In such cases, repayment is likely to be subject to whether the person who overpaid was liable for the error, by not reporting the change in income.

Retrospective amendments

Services Australia or the courts may amend child support assessments retroactively, usually upon the introduction of new evidence. For example, if a payer’s income was initially under-reported and corrected later, the receiving parent might be required to repay the additional amounts.

Parenting arrangement changes

If there are changes to the child’s care arrangements (such as the child spending more time in one parent’s home) this may alter the calculation of child support. As a result, payments made during the transition period may need adjustment.

Repayment enforcement and mechanisms

When there is a clear overpayment of child support, Services Australia typically takes steps to recover the excess amount. Services Australia has robust powers to recover overpayments including through administrative action, legal proceedings, and negotiation between parties. For instance, Services Australia might:

• deduct overpaid amounts from future child support liabilities,
• ask the receiving parents to repay overpayments, or
• garnish wages, tax refunds, or bank accounts of the receiving parent.

Where administrative recovery by Services Australia is insufficient or contested, the paying parent may initiate legal proceedings in the Federal Circuit and Family Court of Australia. The court assesses whether repayment is justified, considering the:

• circumstances leading to the overpayment,
• financial hardship repayment may impose on the receiving parent, and
• best interests of the child.

Negotiated settlements

Parties can also resolve repayment disputes between themselves. This usually involves negotiation or mediation, which may be facilitated by legal representatives or Services Australia officers. Negotiated settlements often focus on balancing fairness and the financial capacity of both parties.

Receiving parents faced with repayment claims may raise several defences, particularly if repayment would cause undue hardship or contradict the principles of equity.

The court and Services Australia officers will consider whether repayment would impose significant financial hardship on the receiving parent or jeopardise the welfare of the child. For example, a parent reliant on child support for essential living expenses might successfully argue against repayment, especially if that parent behaved reasonably in the circumstances.

For instance, if the paying parent delayed making a repayment claim, the defence of laches (delay causing detriment) may apply to prevent an order from repayment.

Repayment of child support in Australia usually requires either an administrative process or and court hearing. While the system aims to balance the rights and obligations of both parents, it must also prioritise the best interests of the child. Consult Go To Court Lawyers on 1300 636 846 for any legal assistance.