If you are a parent that does not live with your child, or you share the care of your child with someone else, you may have to pay support. Child support is money that you pay to assist with the upbringing and care of your child.

There are different types of child support agreements that you and your co-parent or carer can choose from. It is important to do your research and choose which type of agreement is best for your circumstances.

There are three types of child support agreement: private agreements, voluntary agreements, and the formula assessment.

Private Agreement

A private agreement does not involve the Inland Revenue Department (IRD). Under a private agreement, two parents can agree on an amount to pay for child support and pay this directly to each other. IRD encourages parents and carers to reach their own arrangements for child support, however if the arrangement is not working out then an application can be made for a voluntary agreement or formula assessment.

There are online child support calculators which can help parents who would like to create a private support agreement and getting assistance from a legal professional can assist in reaching and documenting that agreement..

Voluntary Agreement

A voluntary agreement is where two parents or carers agree on the amount of child support that should be paid and who receives it. However, rather than managing the payments themselves, the IRD manages the payments. In order for the IRD to manage the payments, the voluntary agreement needs to be registered. The minimum amount of child support under a voluntary agreement is $10 per week.

A voluntary support agreement can be more secure than direct payments to each parent under a private agreement because the payments are managed by an independent third party. The child support payments are deducted from the responsible parent’s income and sent to the IRD, who then passes that payment on to the receiving parent. This process is the same whether the parent is employed, on a benefit, or receiving student loan payments.

A voluntary agreement removes the stress of ensuring that child support payments are made on time, and allows the IRD to enforce the payments if needed.

Formula Assessment

Finally, the IRD can determine the amount of child support payable by assessing and calculating based on each parent or carer’s circumstances.

The formula assesses both parent’s income, living costs, the amount of time each parent cares for the child, the cost of raising the child and whether there are any other children in the parent’s care.

It is important to note that if the person caring for the child is not a parent, their income will not be assessed for child support.

When does a voluntary agreement or formula assessment end?

Child support agreements can end for a number of reasons. Parents may no longer be required to pay child support, for example when the child turns 18 or has finished school.

The agreement can also end if the parents agree to a different type of agreement, such as changing from a private agreement to a formula assessment. The receiving parent can also cancel an agreement if they wish to. If you enter into a voluntary agreement with an expiry date, child support will end upon reaching this date.

Assessing how child support should be paid, or whether it is required at all, can be a difficult and stressful process. If you are confused about what your options are, it pays to seek advice from a professional with experience in the area.

 

Leading law firms committed to helping clients cost-effectively will have a range of fixed-price Initial Consultations to suit most people’s needs in quickly learning what their options are.  At Rainey Collins we have an experienced team who can answer your questions and put you on the right track.

Gianna Menzies and Hunter Flanagan-Connors