Child Support Legislation Amendment (Reform of the Child Support Scheme - New Formula and Other Measures) Act 2006 (146 of 2006)
Schedule 5 Amendments relating to child support agreements and court orders (commencing on 1 July 2008)
Part 1 Main amendments
Division 3 Notional assessments
Child Support (Assessment) Act 1989
71 After Part 7
Insert:
Part 7A - Notional assessments
Division 1 - Preliminary
146A Simplified outline
The following is a simplified outline of this Part:
• If the Registrar accepts a certain kind of child support agreement, or the court makes a certain kind of order, the Registrar must make a provisional notional assessment of the annual rate of child support that would be payable for a day in a child support period if child support were payable under Part 5 instead of under the agreement or order.
• The notional assessment is used in the maintenance income test in working out a person's Part A rate of family tax benefit under the A New Tax System (Family Assistance) Act 1999.
• A parent may estimate their adjusted taxable income for the purposes of making a provisional notional assessment.
Division 2 - Notional assessments
146B Provisional notional assessments
(1) The Registrar must make a provisional notional assessment in accordance with this section if:
(a) the Registrar makes an assessment under section 34B or section 93; or
(b) a court makes a statement under section 125, in an order under section 124, that an annual rate of child support payable is to be reduced.
(2) The Registrar must make a provisional notional assessment of the annual rate of child support that would be payable for a child for a particular day in a child support period, by the liable parent to the carer entitled to child support, if that annual rate were payable under Part 5 (taking into account any relevant determination under Part 6A, or any relevant order under Division 4 of Part 7) for the child for that day instead of under the agreement or order.
(3) The Registrar must serve notice in writing of the provisional notional assessment on the liable parent and the carer entitled to child support.
(4) The notice must specify in respect of the provisional notional assessment the matters that are required under section 69 and subsection 76(2) in respect of an administrative assessment.
(5) The notice must include, or be accompanied by, a statement to the effect that:
(a) the liable parent or the carer entitled to child support can seek a variation of the provisional notional assessment in accordance with section 146C within 14 days of receiving the notice; and
(b) once the provisional notional assessment becomes a notional assessment under section 146E, the liable parent or the carer entitled to child support may, subject to the Registration and Collection Act, object to the particulars of the notional assessment; and
(c) if aggrieved by a later decision on an objection to those particulars, the liable parent or the carer entitled to child support may, subject to that Act, apply to the SSAT for review of the later decision.
146C Variation of provisional notional assessments
(1) A liable parent or carer entitled to child support (the applicant ) may seek a variation of a provisional notional assessment within 14 days of receiving a notice under section 146B in respect of the provisional notional assessment by doing one or more of the following:
(a) by notifying the Registrar of a change to the percentage of care that the liable parent or the carer entitled to child support has for the child for the particular day in the child support period in respect of which the provisional notional assessment is made;
(b) by making an application under section 146D for a determination under Part 6A (departure determinations);
(c) if the applicant is a parent of the relevant child - by making an election under subsection 146G(1) (estimate of adjusted taxable income).
Note: A person who does not receive a notice that is served on the person is taken to have received the notice 14 days after the notice was served (see subsection 146E(2)).
(2) The Registrar may vary the provisional notional assessment of the annual rate of child support that would be payable for the child for the particular day if:
(a) an applicant seeks a variation in accordance with subsection (1); and
(b) any one or more of the following applies:
(i) if paragraph (1)(a) applies - the Registrar determines a different percentage of care for the parent or the carer for the child for the particular day under Division 4 of Part 5;
(ii) if paragraph (1)(b) applies - the Registrar makes a determination in respect of the child under section 98S;
(iii) if paragraph (1)(c) applies - the Registrar does not refuse to accept the election under section 146H.
(3) The Registrar may refuse to vary the provisional notional assessment if:
(a) the liable parent or the carer entitled to child support seeks a variation to the provisional notional assessment in accordance with subsection (1); and
(b) any of the following applies:
(i) if paragraph (1)(a) applies - the Registrar does not determine a different percentage of care for the parent or carer for the child for the particular day under Division 4 of Part 5;
(ii) if paragraph (1)(b) applies - the Registrar refuses to make a determination in respect of the child under section 98S;
(iii) if paragraph (1)(c) applies - the Registrar refuses to accept the election under section 146H; and
(c) if the liable parent or carer entitled to child support seeks a variation by doing more than one of the things mentioned in subsection (1) - the Registrar has not already varied the provisional notional assessment under subsection (2).
(4) The liable parent and the carer entitled to child support are not entitled:
(a) to make an application to the SSAT under section 80 of the Registration and Collection Act; or
(b) to make an application to a court under section 116;
in respect of the making of, or refusal to make, a determination under Part 6A.
Note: Instead, once the provisional notional assessment becomes a notional assessment, an objection can be made to the particulars of the notional assessment under section 80 of the Registration and Collection Act.
146D Departure determinations in respect of provisional notional assessments
(1) A person may, by written application, ask the Registrar to make a determination under Part 6A (departure determinations) if:
(a) a provisional notional assessment has not yet become a notional assessment under section 146E; and
(b) the person is of the view that, because of special circumstances that exist, the provisions of this Act relating to administrative assessment of child support should be departed from for the purposes of making the provisional notional assessment; and
(c) the person has not previously applied under this section in relation to the provisional notional assessment.
(2) If a person makes an application under subsection (1), Division 2 of Part 6A applies as if:
(a) references in that Division to an administrative assessment were references to the provisional notional assessment; and
(b) section 98JA did not apply.
146E Notional assessments
(1) A provisional notional assessment becomes a notional assessment :
(a) 14 days after the notice of the provisional notional assessment is received by all the parties under section 146B; or
(b) if a liable parent or a carer entitled to child support seeks a variation to the provisional notional assessment in accordance with section 146C - on the day on which the Registrar varies, or refuses to vary, the provisional notional assessment under that section.
(2) For the purposes of this section and section 146C, if a person does not receive a notice served under section 146B before 14 days after the day on which the notice was served on the person by post at the person's last known address, the person is taken to have received the notice on the 14th day.
(3) To avoid doubt, subsection (2) applies whether the person receives the notice after the time referred to in that subsection or does not receive the notice at all.
(4) After a provisional notional assessment becomes a notional assessment, the Registrar must serve notice in writing of the notional assessment on the liable parent and the carer entitled to child support.
(5) The notice must specify in respect of the notional assessment the matters that are required by section 69 and subsection 76(2) in respect of an administrative assessment.
(6) The notice must include, or be accompanied by, a statement to the effect that:
(a) the party may, subject to the Registration and Collection Act, object to the particulars of the notional assessment; and
(b) if aggrieved by a later decision on an objection to those particulars, may, subject to that Act, apply to the SSAT for review of the later decision.
(7) A contravention of subsection (5) or (6) does not affect the validity of the notional assessment.
146F Later provisional notional assessments
The Registrar must make a new provisional notional assessment under section 146B:
(a) if the relevant child support agreement or court order continues in force for more than 3 years - at the end of the 3 year period after the most recent notional assessment relating to the agreement or order was made; or
(b) if the relevant child support agreement was a limited child support agreement - on the request of a party to the agreement; or
(c) in any case - if the amount of child support that is payable under the relevant child support agreement or court order for a day in the child support period changes by more than 15% from the previous day.
Division 3 - Estimating adjusted taxable income for notional assessments
146G Estimating adjusted taxable income for purposes of notional assessments
(1) Before a provisional notional assessment relating to a child becomes a notional assessment under section 146E, a parent of the child may elect that, for the purposes of making the provisional notional assessment, the parent's adjusted taxable income for the 12 month period beginning on the particular day in the child support period in respect of which the provisional notional assessment is made is the amount estimated by the parent.
(2) However, a parent may not make an election under this section in relation to a child if an order or determination referred to in paragraph (a) of the definition of income amount order is in force in relation to the parent and the particular day in the child support period in respect of which the provisional notional assessment is made.
Election must be for amount less than adjusted taxable income for last relevant year of income
(3) The parent may make an election relating to a child only if the amount that he or she estimates under subsection (1) is not more than 85% of the total of the parent's adjusted taxable income for the last relevant year of income for the child support period.
How election is made
(4) The parent makes the election by giving notice of it to the Registrar in the manner specified by the Registrar. The notice must specify the amount the parent estimates to be his or her adjusted taxable income.
146H Registrar may refuse to accept election
(1) The Registrar may refuse to accept the parent's election if the Registrar is satisfied that the amount the parent estimated under subsection 146G(1) is likely to be less than the actual amount that would be the parent's adjusted taxable income for that 12 month period.
Note: If the Registrar refuses to accept the election, he or she may refuse to vary the provisional notional assessment under subsection 146C(3).
(2) In making the decision as to whether to refuse the election, the Registrar:
(a) may act on the basis of information that the Registrar has received or obtained as to the financial circumstances of the parent; and
(b) may, but is not required to, conduct an inquiry into the matter.
(3) Except for the purposes of Parts VII, VIIA and VIII of the Registration and Collection Act (dealing with objections and appeals), if the Registrar refuses to accept an election, the election is taken never to have been made.
146J Effect of election
(1) If a parent makes an election under subsection 146G(1) relating to a child, then, for the purposes of making the provisional notional assessment, the parent's adjusted taxable income is the amount the parent estimated.
(2) Subsection (1) has effect subject to any order or determination referred to in paragraph (a) of the definition of income amount order that is made after the making of the election that applies in relation to the parent and the particular day in the child support period in respect of which the provisional notional assessment is made.
(3) The Registrar must take such action as is necessary to give effect to subsection (1) in relation to the provisional notional assessment that has been made in relation to the parent and the child (whether by varying the provisional notional assessment or otherwise).
146K Revocation of election
(1) Before a provisional notional assessment becomes a notional assessment under section 146E, a parent who has made an election under subsection 146G(1) in relation to a child may, by notice given to the Registrar, revoke the election.
(2) A notice given to the Registrar must be given in the manner specified by the Registrar.
Note: Section 150A provides for the Registrar to specify the manner in which a notice may be given.
146L Effect of revocation
(1) If a parent who made an election under section 146G relating to a child revokes the election and substitutes a new election before the provisional notional assessment becomes a notional assessment under section 146E, then, for the purposes of making the provisional notional assessment, the parent's adjusted taxable income is the amount the parent elected in the new election.
(2) Subsection (1) has effect subject to any order or determination referred to in paragraph (a) of the definition of income amount order that is made after the making of the election that applies in relation to the parent and the particular day in the child support period in respect of which the provisional notional assessment is made.
(3) The Registrar must take such action as is necessary to give effect to subsection (1) in relation to the provisional notional assessment that has been made in relation to the parent and the child (whether by varying the provisional notional assessment or otherwise).
(4) This section does not prevent:
(a) the Registrar making a determination under Part 6A; or
(b) a court making any order under Division 4 of Part 7; or
(c) the making, and acceptance by the Registrar, of a child support agreement that includes provisions that have effect, for the purposes of Part 5, as if they were such an order made by consent.