Child support

Child support is money paid by a parent to support their child when the child is not living with that parent. In the child support scheme, that parent is called a “liable parent”.

Who can apply for child support?

You can apply for child support from a liable parent if you’re the sole or the main caregiver of the child, or if you share day-to-day care equally with another person.

In the child support scheme, a caregiving parent, is called an “eligible custodian” of the child.

Which children qualify for child support?

The child must be -

under 19
not married or in a civil union or de facto relationship
not financially independent (financially independent means they work more than an average of 30 hours a week on average, or receive a benefit or student allowance), and
a New Zealand citizen, or else New Zealand must be where they usually live.

How the child support scheme works

The child’s caregiver or the liable parent can apply to Inland Revenue Child Support for an assessment of child support. Usually the caregiver applies.

Inland Revenue then assesses the liable parent’s income to find out how much child support must be paid. There’s a set formula for this (a “formula assessment”). IRD can collect child support from the liable parent and pay it to the caregiver, or the two parents can reach a voluntary agreement about how much child support will be paid, and how and when.

Child support and the benefit system

If the caregiver isn’t on a benefit they can choose whether or not to apply for child support. Any child support payment is paid directly to the caregiver.

If the caregiver is on a benefit, they must apply for a child support assessment, or else name the other parent so that Work and Income can claim child support from them, to offset the cost of the caregiver’s benefit. If the caregiver refuses to do this, Work and Income can reduce their benefit (although there are some special cases when they can’t reduce it). The child support is paid directly to Work and Income, not to the caregiver. If it’s more than the benefit, the caregiver receives the difference.

How much child support will be paid?

The amount of child support is worked out by using a standard formula – a “formula assessment”. The amount depends on –

the liable parent’s taxable income (for the previous year or the year before that), and
the number of children, and
a set living allowance.

There is a minimum annual amount of child support that must be paid. This is adjusted each year for inflation. More information on calculating child support can be found here.

How is child support paid?

Child support is paid to the caregiver in monthly amounts. It can also be paid in a lump sum, but this requires a Court order.

“Shared” and “split” care

If both parents share the care of the child (at least 40% of the time each), they are each assessed with a modified formula, and the parent with the higher liability pays the difference to the other.

On the other hand, it may be that care is “split” – for example, there are two children and one parent has one child all the time and the other parent has the other. In that case they are each assessed with the standard formula. Again, the parent with the higher liability pays the difference to the other.

Are any parents exempt from paying child support?

Yes. If the liable parent is in prison or hospital they may be exempt from paying child support while they’re there. The liable parent must apply for an exemption.

Voluntary agreements

If a caregiving parent is not on a benefit, he or she can choose to make a voluntary agreement with the liable parent, rather than having a formula assessment. The agreement may be registered with Inland Revenue Child Support.

Inland Revenue can still collect and enforce payment, but only if the minimum payment under the agreement is at least $10 a week

What does a voluntary agreement need to cover?

The agreement should state –

that the liable parent accepts he or she must pay child support
the amount to be paid
how often the payments will be
any extra commitments by the liable parent - school fees, for example.

Voluntary agreements by caregivers who are beneficiaries

If the caregiver is on a benefit, a voluntary agreement between the parents will only be accepted if the amount of child support under the agreement is at least equal to the formula assessment.

The liable parent must pay the amount to Inland Revenue. If it’s more than the benefit, the caregiver will receive the difference.

“Objections”: challenging child support decisions

A caregiver or liable parent who has been assessed for child support can challenge the assessment by making an “objection” to Inland Revenue Child Support. The assessed amount must be paid until a decision is made on the objection.

People can also object to other child support decisions – such as a decision to charge a penalty, or to refuse to accept a voluntary agreement, or to refuse to grant an exemption from paying child support.

What are the grounds for objecting to an assessment?

You can object to a child support assessment only on one of the following grounds -

that the liable parent’s income was assessed incorrectly
that the rate of child support was worked out incorrectly
that the number of days for which child support has to be paid was incorrect
that the assessment doesn’t properly apply the Child Support Act 1991.

What’s the time limit for making an objection?

You must make your objection to Inland Revenue Child Support within 28 days after the date on the notice telling you about the decision. Inland Revenue doesn’t have to consider your objection if you miss this deadline.

What can I do if my objection is unsuccessful?

If Inland Revenue turns down your objection, you can appeal its decision to the Family Court. You have two months to file your appeal.

Departure orders from formula assessments

In some cases Inland Revenue or the Family Court can make a “departure order” to allow child support to be assessed differently from the standard formula assessment.

Usually you have to apply to Inland Revenue for the order. But you can apply to the Family Court if Inland Revenue has already made a decision. You can also apply to the Family Court if the Court is already dealing with a case that you’re involved in (for example, a dispute about relationship property or about arrangements for care of the children).

When can IRD or the Court make a departure order?

The Child Support Act sets out a number of special cases when Inland Revenue or the Family Court can make a departure order, including –

if either parent’s ability to support the child financially is significantly less because they have someone else to support, or
if the cost of supporting the child is significantly affected because the child has special needs or is being cared for or educated in a particular way, or because the costs of the liable parent having contact with the child are especially high, or
if the standard formula assessment would be unfair to the liable parent because of the parents’ financial positions, or because the liable parent has already paid money or transferred property to the caregiver, or because the caregiver is continuing to live in a place owned or part-owned by the liable parent.

IRD or the Family Court must also be satisfied that a departure order would be fair to the child and both parents.

How child support is enforced

If a liable parent doesn’t pay the amount of child support required, there are a number of ways Inland Revenue can enforce payment –

they can issue a “deduction notice” so that the money will be taken out of the liable parent’s benefit, wages or bank account
they can add penalties to what the liable parent owes
they can take Court action in the same way that any creditor can apply to the Court to enforce a debt.

The Court can –

issue a “distress warrant” for the liable parent’s property to be seized; or
put a “charge” over the liable parent’s property , which means that if the liable parent sells the property the debt can be recovered from the sale proceeds, or
give the liable parent a “summons”, ordering them to come to the Court to have their financial situation investigated.