Information for parents who receive Family Tax Benefit
Child support payments and family assistance are closely linked. The more child support
you receive, the less Family Tax Benefit you may receive. Similarly, if you receive
less child support you may be entitled to more Family Tax Benefit. This is important
to know, even if you arrange your child support privately with the other parent
or have a child support agreement.
Applying for child support
Parents have up to 13 weeks to work out parenting arrangements and apply for child
support after they separate, to avoid a reduction in their Family Tax Benefit Part
A payments. This gives parents enough time to get information, receive counselling
or agree about post-separation arrangements, including the negotiation of a parenting
plan.
If you don’t apply for child support for a child from a previous relationship,
you cannot receive more than the base rate of Family Tax Benefit Part A for that
child. This requirement is called the Maintenance Action Test.
Income from child support
Any child support you receive for children in your care, even if you arrange it privately
with the other parent, can affect your family assistance.
Your Family Tax Benefit is calculated according to how much child support you receive.
Called the Maintenance Income Test, this test reduces the amount of your Family
Tax Benefit Part A by 50 cents for every dollar you receive in child support above
a certain exempt amount, known as the Maintenance Income Free Area (MIFA).
If you have a child support agreement with a
previous partner, your Family Tax Benefit is worked out the same way except the
calculation may use how much child support would have been paid to you had the agreement
not been made.
The amount by which your Family Tax Benefit is reduced, under the Maintenance Income
Test, cannot exceed the maximum amount of additional Family Tax Benefit you receive
for your child support children. Children who are not child support children are
not included when working out the MIFA.
Child support and family assistance
Child support and family assistance work together to make sure the costs of the children
are being met by both parents. If you have a
child support assessment, each parent’s percentage of care determines
their entitlement to family assistance.
Learn more about percentage of care.
Help and information
To find out more about Family Tax Benefit: