FAQ: How do you work out what my income is?
Several types of income are taken into account when working out child support payments for both parents. We add up these amounts to get your adjusted taxable income, which is based on your last completed financial year of income:
- taxable income, that is the income shown on your tax return. You need to lodge a tax return each year so we are able to work out your income. If you do not lodge a tax return and we can’t work out your income from other information, we will use a provisional income to assess your child support.
- provisional income - is used when you do not have an ATO assessed income. It is based on:
- a derived income - where the CSA works out a ‘reasonable approximation’ of your income using all available income information for the required year. If the CSA does not have this information they will use a
- a deemed income - where the CSA works out your income using the last ATO assessed income indexed in line with wages growth. If CSA does not have your last ATO assessed income they will use
- a default income - where the CSA indexes the most recently available ATO income and compares it to 2/3 Male Total Average Weekly Earnings (2/3 MTWAE) and uses the higher income. If no ATO income is available, CSA will use 2/3 MTAWE.
- gross reportable fringe benefits i.e. the value of gross reportable fringe benefits total for the income year, which is reported on your payment summary
- target foreign income i.e. any foreign income you receive that is not taxable income or a fringe benefit
There is an investment loss if the deductions for financial investments are more than the gross income from those investments for the year. There is a rental property loss if the deductions for the rental property are more than the gross income from the property for the year. The excess amounts are added together and this is the total net investment loss. This figure will be added back on to your taxable income for child support purposes. Only rental property losses are included for financial years prior to 2009/10.
- some tax free pensions (including disability support pensions, wife pensions, carer payments and some Veterans’ Affairs payments such as invalidity service pension, partner service pension, income support supplement and Defence Force income support allowance)
- reportable superannuation contributions, any salary sacrificed super contributions or extra contributions an employer makes to your super fund on your behalf. This includes any personal contributions made to a super fund that can be claimed as an income tax deduction on your tax return. Reportable superannuation contributions are not included in adjusted taxable income for financial years prior to 2009/10.
Updated: 23 Sep 2009
Categories: Parents
Sub-categories: Income