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Tribunal: Member Andrea Schiwy

This review was about the amount of child support payable by Mr Smithson to Ms Smithson in respect of their two children. The parents used to live overseas until their separation, at which point Ms Smithson moved back to Australia with their two children. Mr Smithson remained working overseas until he returned to Australia around May 2017.

Mr Smithson had been paying child support since May 2015. On 13 October 2017, Ms Smithson applied to the child support branch of the Department of Human Services (the Department) for an increase to the amount of child support payable by Mr Smithson.

The Department uses a statutory formula to calculate the child support payable by one separated parent to the other.[1] There are many variables used in this calculation including the parents’ adjusted taxable incomes. Certain special circumstances allow the Department to depart from using this calculation[2] and do things such as vary the annual rate of child support payable and/or the adjusted taxable income of a parent.[3]

Ms Smithson requested a departure from the formula assessment for two reasons. First, she believed Mr Smithson was not helping pay for the schooling of one of the children, schooling she claimed they had both agreed to. Second, she believed that Mr Smithson was not being truthful about his income, which had resulted in an unfair calculation of child support payments.[4]

In relation to her first request, Ms Smithson claimed that Mr Smithson had agreed to pay half of one of the children’s fees at a school where she had received a scholarship but that he did not provide any assistance. The scholarship covered only a portion of the fees but Mr Smithson claimed that Ms Smithson misled him about the amount of tuition fees the scholarship covered. In order to depart from the statutory formula for this reason, the AAT must be satisfied that the extra costs arose because the child was being educated in the manner that was expected by both parents.[5] After considering the evidence, the AAT found that there was no agreement between the parents that the child would stay at the school without a scholarship. The AAT concluded that there could not be a departure from the statutory formula in relation to this reason. 

The AAT investigated Ms Smithson’s second reason for departure from the formula, in relation to Mr Smithson’s taxable income after 1 January 2018. Mr Smithson’s employment over this period was irregular; he lost his job in May 2018 and he claimed to be working part time after that point. The AAT requested further documentation from Mr Smithson including his 2017-18 income tax return, pay as you go (PAYG) payment statements for all employment in 2017-18 and bank statements. Mr Smithson failed to provide the majority of the requested bank statements and some PAYG statements. The AAT was not satisfied that all of Mr Smithson’s earnings were included in his 2017-18 income tax return as he did not provide his bank statements as directed. After considering the evidence, the AAT was satisfied that the level of Mr Smithson’s income used in the statutory formula was less than the AAT’s assessment of his income and this was a special circumstance that made the level of child support payable under the formula unjust and inequitable.

There are two further steps before the AAT can order a departure from the statutory formula and vary the child support amount. The AAT must be satisfied that such an order would be, first, just and equitable, and second, otherwise proper.[6]

The AAT found that a departure would be just and equitable after considering the necessary matters, which included the proper needs of the children, income, property, financial resources and earning capacity of each parent and any hardship that would be caused.[7] The AAT stated that the proposed change in the child support assessment would ensure that both Mr Smithson and Ms Smithson share in the ongoing costs of caring for the children at a level equal with their resources.

The AAT concluded that a departure was otherwise proper noting that a prime objective of the child support legislation is that parents should support their own children to the extent of their real capacity and this obligation should not be unnecessarily put on the welfare system.

The AAT set aside the decision and raised Mr Smithson’s income between 1 January 2018 and 30 September 2018.

Read the full decision on AustLII.

Names used in all child support decisions are pseudonyms so as not to identify involved individuals as required by subsections 16(2AB)-16(2AC) of the Child Support (Registration and Collection) Act 1988.


[1] See Part 5 of the Child Support (Assessment) Act 1989.

[2] Section 98B of the Child Support (Assessment) Act 1989.

[3] Section 98S of the Child Support (Assessment) Act 1989 lists all the determinations available to a decision-maker departing from the statutory formula.

[4] Ms Smithson’s claims are both listed as grounds for departure in subparagraph 117(2)(b)(ii) and 117(2)(c)(ia) of the Child Support (Assessment) Act 1989, respectively.

[5] See paragraph 22 of the full decision.

[6] Subparagraph 117(1)(b)(ii) of the Child Support (Assessment) Act 1989.

[7] The full list of matters for consideration are found in subsections 117(4) to (9) of the Child Support (Assessment) Act 1989.