appellant. The Tribunal set aside the decision under review and substituted a determination that, for the period 14 December 2016 to 31 December 2022, the rate of child support is varied to nil.
Key principles
A ground for departure under subparagraph 117(2)(c)(ia) exists where, in the special circumstances of the case, the administrative assessment results in an unjust and inequitable...
The Tribunal may determine a parent's income for child support purposes by reference to available tax return information where the parent has failed to provide recent disclosure;...
Where one parent has not supplied requested financial disclosure, it is permissible to rely on earlier reliable tax return data and make an income finding that reflects the...
The Tribunal must consider whether a particular determination is just and equitable under s98C having regard to factors in s117(4); after applying those factors (including...
Issues before the court
Whether a ground for departure from the administrative child support assessment exists under subparagraph 117(2)(c)(ia) given the parents' incomes...
Plain English Summary
The AAT reviewed a Department decision that had the father paying child support. The father argued the administrative assessment did not properly reflect the mother's income. The mother did not provide recent financial disclosure. The Tribunal fixed the father's income at $145,000 and, relying on the mother's 2013/14 tax return because of her non-disclosure, fixed her income at $174,765. Using those incomes the statutory formula would have made the mother pay a small amount to the father. Comparing that to the administrative assessment which had the father paying a substantial amount, the Tribunal found the assessment unjust and inequitable under the Act. After considering statutory factors including costs, commitments and hardship, the Tribunal set aside the previous decision and ordered that neither parent pay child support to the other (rate varied to nil) for the period 14 December 2016 to 31 December 2022.
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Deep Dive
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Whether it is just and equitable to make a particular departure determination under s98C(1)(b)(ii)(A) and subsection 117(4).
Whether it is otherwise proper to make the proposed departure determination (public interest/community fairness considerations).
Cited legislation
1 cited instrument linked from this judgment.
What happened
This review concerned the child support assessment for one child (born November 2010). The parents shared care equally and the administrative assessment in place when the father (Mr Cahill) applied for a change of assessment on 14 December 2016 recorded the father as liable to pay $7,842 per annum (based on his estimate of his own income and the mother’s adjusted taxable income recorded as nil) [Background 3]. The Department made an original change decision on 28 March 2017 then, on objection, an objections officer adjusted the mother’s adjusted taxable income to substantial amounts for successive calendar years (eg $110,233 for 14 Dec 2016–31 Dec 2017, increasing to $124,707 for 2022) [Background 4–5]. The father sought review in the AAT (application lodged 3 July 2017, heard 11 April 2018). The mother did not attend the directions hearing nor the substantive hearing and failed to provide the financial disclosure directed by the Tribunal [Background; Consideration].
Member S Hoffman analysed whether a ground for departure under subparagraph 117(2)(c)(ia) of the Child Support (Assessment) Act 1989 existed, determined appropriate income figures for child support purposes (father $145,000, mother $174,765), compared the resulting statutory liability with the administrative assessment, and concluded that the administrative assessment was unjust and inequitable. Applying the s117(4) factors (incomes, commitments, costs of the child, hardship), and considering whether the departure would be otherwise proper, the Tribunal set aside the decision under review and substituted a determination varying the rate of child support to nil for the period 14 December 2016 to 31 December 2022 [Decision].
Why the court decided this way
The decision follows the statutory framework in the Child Support (Assessment) Act 1989. The Tribunal’s analysis proceeded in the statutory sequence required by s98C and s117:
Ground for departure (s117(2)(c)(ia)): The Tribunal had to be satisfied that, in the special circumstances of the case, the administrative assessment would result in an unjust and inequitable determination of the rate of child support because of the income, property or financial resources of either parent. The Tribunal found that using the incomes it calculated (father $145,000; mother $174,765) the child support formula would have produced a small liability by the mother to the father ($1,189 p.a.), whereas the administrative assessment had the father paying $7,842 p.a. This disparity led the Tribunal to conclude the administrative assessment was unjust and inequitable, establishing the statutory ground for departure [28]-[30].
Just and equitable (s117(4)): The Tribunal then considered the statutory factors: each parent’s income, property and resources; commitments (including any maintenance obligations to others); costs of the child; and hardship. The Tribunal assessed the father's income and liabilities from his SFC and evidence (including a fringe benefit value of $15,000 added for a vehicle), and the mother’s historical tax return because she failed to comply with disclosure directions [12], [22]-[24]. The Tribunal concluded the father was under some financial strain while there was no evidence of hardship for the mother [46], and found that setting the rate to nil would be just and equitable, reflecting the equality of care and the relatively small net liability on its income findings [53].
Otherwise proper (s117(5)): The Tribunal considered community fairness factors including whether family assistance might be affected. No family tax benefit evidence was before the Tribunal, and it concluded that the determination appropriately apportioned responsibility between the parents and the community [56]-[57].
Key evidentiary and practical reasoning steps underpin the decision:
Non-disclosure by the mother: the mother did not comply with the Tribunal's direction to provide an SFC and recent tax returns. The Tribunal applied the principle (citing Conway) that courts and tribunals should not be unduly cautious about making findings in favour of the party who has provided disclosure when the other has not [18]. Accordingly, the Tribunal relied on the mother’s last available tax return (2013/14) to fix her income for child support purposes [24].
Identification of incomes: the Tribunal adjusted the father’s declared income to $145,000 for child support purposes by adding $15,000 for a fringe benefit (the employer-provided 2017 vehicle), and concluded that income better reflected his capacity for child support [12]. For the mother, because of lack of current disclosure, the Tribunal used the 2013/14 return showing employment income of $174,765 (noting significant carried-forward losses that earlier produced a nil taxable income in that year) [22]-[24].
Comparison of liabilities: the Tribunal computed the statutory result from its income determinations (mother liable to pay a modest amount), contrasted that to the administrative assessment (father liable to pay a much larger amount), and held that the administrative assessment was unjust in these special circumstances [28]-[30].
Practical relief: balancing the s117(4) factors and hardship considerations, and noting both parents had expressed views consistent with a nil rate going forward (the mother had indicated she did not wish to place financial stress on the father), the Tribunal determined neither parent should pay child support to the other from 14 December 2016 to 31 December 2022 [52]-[53].
Before and after state of the law
Before this decision: The statutory framework governing departures from administrative child support assessments was settled, s98C authorises departure determinations where a ground exists and it is just and equitable and otherwise proper; s117 sets out grounds and factors. Courts and tribunals have long recognised that where a party fails to disclose financial information, tribunals may proceed to make findings on available evidence (see Conway and authorities cited).
After this decision: The Tribunal applied those established principles in a straightforward way: where a parent fails to provide disclosure the Tribunal may rely upon earlier tax returns and make income findings on that basis, and where the administrative assessment produces a materially different apportionment that is unjust on the facts, a departure to nil may be ordered for a specified period. The decision reinforces two practical points for practitioners:
Non-disclosure can lead to the Tribunal fixing an income figure for child support purposes from available historic tax records, even where those records show losses that previously produced low taxable income, because the Tribunal can treat gross income as reflecting resources relevant to child support.
A substantial mismatch between administrative assessment results and a Tribunal-calculated result based on better-evidenced incomes may satisfy the “unjust and inequitable” ground in s117(2)(c)(ia).
The decision does not create new law but demonstrates application of established principles in the AAT setting.
Key passages with plain-English translation
Tribunal’s statement of the statutory ground: "Subparagraph 117(2)(c)(ia) ... where ... the administrative assessment ... would result in an unjust and inequitable determination ... because of the income, property and financial resources of either parent." [paragraph 1 of Issue 1]
Plain English: If the statutory formula produces an outcome that is unfair in the particular circumstances because of what either parent earns or owns, the Tribunal can depart from the administrative assessment.
Tribunal on non-disclosure and reliance on historic tax return: "…it is appropriate to rely on the most recent tax return information it has sighted which is for 2013/14, and considers that the mother's income for child support purposes is $174,765." [paragraph 24]
Plain English: Because the mother would not give the Tribunal recent financial statements, the Tribunal used the last tax return it had to decide how much she earns for child support calculations.
Tribunal’s comparison and conclusion on injustice: "Given the difference between $7,842 payable by the father and $1,189 payable by the mother per year, the Tribunal is satisfied ... the administrative assessment does result in an unjust and inequitable rate ..." [paragraph 30]
Plain English: The administrative assessment made the father pay much more than it should have, given the incomes the Tribunal found, so it would be unfair to keep that assessment.
Operative decision: "The Tribunal has determined that neither parent is to pay child support to the other ... start from 14 December 2016 ... ends 31 December 2022." [paragraph 53]
Plain English: The Tribunal ordered no child support be payable by either parent to the other for the period specified.
What fact patterns trigger this precedent
This decision is most relevant where:
One parent fails to provide requested financial disclosure to the Department and Tribunal despite directions; and
There is evidence (even historic tax returns) suggesting the non-disclosing parent has significant income or resources that are unreflected in the administrative assessment; and
There is a substantial disparity between the administrative assessment outcome and the outcome that would result from incomes the Tribunal considers better reflect each parent’s resources; and
Care is shared (here 50/50) so small net liabilities could be practically balanced; and
There is no evidence that a party’s entitlement to government family assistance will be adversely affected in a way that makes the decision improper.
Practitioners should note that a Tribunal facing non-disclosure may properly consider historic tax returns and other indicia of lifestyle or assets to form an income finding for child support purposes, provided the inference is rationally open on the evidence.
How later courts have treated it
This decision is an AAT decision applying established principles; it cites and follows Conway and other intermediate authorities on non-disclosure and the need for tribunals to be prepared to make findings where disclosure is missing. It does not purport to overrule or change law. Later decisions will treat it as persuasive administrative tribunal reasoning applying s98C and s117. The key precedents relied upon (Conway, Tyagi, Gyselman) remain the touchstones for similar fact patterns.
Practitioners should monitor subsequent AAT or Federal Court decisions for any refinements on when historic tax returns may be treated as a reliable indicator of income where business losses or complex structures exist. This decision shows a Tribunal will use the best evidence it has if a party refuses to engage.
Still-open questions
How should a Tribunal treat complex carried-forward losses and corporate structures when historic returns disclose high gross income but net taxable income is reduced by large non-revenue losses? The Tribunal here relied on gross employment income despite earlier losses carrying taxable income to nil in 2013/14 [22]; a more complex fact pattern could require detailed forensic accounting.
What minimum level of active non-disclosure will justify the Tribunal fixing income from historic returns rather than, for example, making an adverse inference about current income? The Tribunal took the pragmatic route; future tribunals may be required to explain the inference process in greater detail.
How should tribunals approach the interplay between third-party support (eg undertakings by relatives to pay school fees) and s117(5)(b) community fairness considerations? The Tribunal here noted assertions about wealthy relatives supporting school fees but declined to make findings in the absence of evidence [44].
The Tribunal fixed an end date of 31 December 2022 in line with the objections decision. Where a Tribunal substitutes its own income findings, what is the most appropriate end date to select where one party has not engaged and circumstances could change earlier?
The lines between 'income for child support purposes' and tax-centric 'taxable income' can be subtle where fringe benefits or other non-taxed resources exist. The Tribunal added $15,000 for a vehicle fringe benefit to the father's figure [12]; consistent, transparent methodologies for valuing such in-kind benefits would reduce uncertainty.
Conclusion: Cahill and Sanders is a practical AAT decision applying statutory departure powers where non-disclosure produces a materially unfair administrative assessment. It is a useful authority for practitioners addressing non-disclosure, income-fixing from historic returns, and the application of s117 factors to produce a just and equitable outcome.
Judgment (51 paragraphs)
[1]
Cahill and Sanders (Child support) [2018] AATA 1707 (11 April 2018)
[2]
Cahill and Sanders (Child support) [2018] AATA 1707 (11 April 2018)
[3]
DIVISION: Social Services & Child Support Division
[4]
The tribunal sets aside the decision under review and, in substitution, decides that for the period from 14 December 2016 to 31 December 2022, the rate of child support is varied to nil.
[5]
Child support - Departure determination - Income and financial resources of parents - Period of departure - Decision under review set aside and substituted
[6]
Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been removed from this decision and replaced with generic information so as not to identify involved individuals as required by subsections 16(2AB)-16(2AC) of the Child Support (Registration and Collection) Act 1988.
[7]
This review is about the child support assessment in respect of one child born November 2010. The case started on 1 November 2013. Since 12 December 2016, the Department of Human Services - Child Support (the Department) has been responsible for collecting child support. The child's care is shared equally between the parents with the father liable to pay child support.
On 14 December 2016 the father lodged an application for a change of assessment with the Department, on the basis that the administrative assessment did not correctly reflect the mother's income, property and financial resources.
The administrative assessment in place on that date was that the father's annual child support liability was $7,842, based on the father's estimate of income for 2016/17 of $149,897 and an adjusted taxable income of nil for 2015/16 for the mother.
On 28 March 2017 a senior case officer from the Department decided to vary the mother's adjusted taxable income to $43,000 for the period 1 January 2017 to 31 March 2019 (the original decision).
On 15 April 2017 the father lodged an objection to the original decision. On 7 June 2017 an objections officer from the Department made a decision which varied the mother's adjusted taxable income as follows:
[8]
To $110,233 for the period 14 December 2016 to 31 December 2017
[9]
To $112,979 for the period 1 January 2018 to 31 December 2018
[10]
To $115,803 for the period 1 January 2019 to 31 December 2019
[11]
To $118,698 for the period 1 January 2020 to 31 December 2020
[12]
To $121,665 for the period 1 January 2021 to 31 December 2021
[13]
To $124,707 for the period 1 January 2022 to 31 December 2022
[14]
On 3 July 2017 the father lodged an application for review with this tribunal. Following a directions hearing held on 7 March 2018, the matter was heard on 11 April 2018. The father attended the hearing in person and gave sworn evidence. The mother had not attended the directions hearing and did not provide evidence as directed following the directions hearing. The mother informed the tribunal the day before the hearing that she would not be attending.
The tribunal had before it documents provided by the Department (numbered 1 to 469 and 470 to 510), by the father (numbered A1 to A19) and by the mother (numbered B1 to B2).[1]
[15]
The statutory provisions relevant to this review are contained in the Child Support (Assessment) Act1989 (the Act). The Act provides for an administrative assessment of child support to be paid. Pursuant to section 98C of the Act, a decision to depart from the administrative assessment may be made if the following three requirements are met:
A ground is established; and
It would be just and equitable as regards the child, the liable parent and the carer entitled to child support to make a particular determination; and
It would be otherwise proper to make a particular determination.
The grounds for departure from an administrative assessment of child support are set out in subsection 117(2) of the Act.
If the tribunal is satisfied that the three requirements are met, it may make one of the determinations prescribed in section 98S of the Act, which include variations to the annual rate of child support payable, or to the adjusted taxable incomes of the parents and/or carer, or to other components of the statutory formula used to calculate child support.
[16]
Issue 1 - Does a ground exist to depart from the administrative assessment?
[17]
Subparagraph 117(2)(c)(ia) of the Act provides a ground for departure exists where, in the special circumstances of the case, the administrative assessment of child support would result in an unjust and inequitable determination of the rate of child support because of the income, property and financial resources of either parent.
[18]
What is the father's income for child support purposes?
[19]
The father submitted a Statement of Financial Circumstances (SFC) dated 15 July 2017. According to that he has worked as [an occupation] for a [business] for 4½ years. He said that he is still employed at the same place.
The father recorded in his SFC that his income was $3,000 a week. His taxable income for 2016/17 was $159,373. He lodged an estimate of income of $129,511 which applied from 27 July 2017. The father said he expected that his taxable income this financial year would be about $130,000. He said that he was paid a retainer of $45,000 a year plus commission based on the sales he made. He said that the key performance indicators used to calculate his commission had changed and that, in combination with how the [specified] industry has been performing overall, was why his pay has dropped.
The father said that his employer provided him with a 2017 vehicle which is a fringe benefit to him. The tribunal considers it appropriate to take this into account with regard to his income for child support purposes and will add $15,000 a year to his income accordingly.
The tribunal considers therefore that $145,000 better reflects the father's income for child support purposes.
[20]
What is the mother's income for child support purposes?
[21]
The tribunal has limited information about the mother's income, property and financial resources. The objections officer recorded in their decision that the mother did not respond to the father's objection to the Department's original decision made 28 March 2017. The objections officer also stated as follows:
[22]
A review of ATO records implies that [the mother] is associated with multiple businesses and that in her most recent taxation return lodged for 2014 she listed her occupation as [occupation 1]...
[23]
The legal notices issued to [the mother's] financial institutions determined that she has multiple mortgages with multiple persons and does not differentiate her positional holdings on such assets. Furthermore these records did not identify if any business trading was actually occurring...
[24]
The fact that [the mother] has not lodged a recent taxation return, or the required returns associated with her business involvements means that relying on reviewing the financial trading and expenses from these business to obtain an income for her is very difficult.
[25]
The tribunal directed the mother to provide her SFC, tax returns for 2015/16 and 2016/17 and certain information about her business interests. As noted she did not attend the directions hearing or the main hearing. She did not provide her SFC or other information as directed.
In considering what income should be used for the mother for child support purposes, the tribunal had regard to principles noted in a Federal Magistrates Court decision as follows:[2]
[26]
In financial proceedings under the Family Law Act, the authorities make it clear that a Court "should not be unduly cautious about making findings in favour of the other party if it is not satisfied that proper disclosure has been made (see Chang & Su (2002) FLC93-117)". Such principles, in my consideration, have similar application to these matters before the SSAT.[3]
[27]
The mother's taxable income in recent years was nil for 2013/14, $22,019 for 2014/15 and she declared nil income for 2015/16. The father said that as far as he knew, the mother had made her money in her role as [an occupation 1]. He said that her lifestyle suggests that she still generates a good income. He said that she was involved with a property development some years ago that lost money and was able to reduce her current income by offsetting those losses.
According to the mother's tax return for 2013/14, she generated an income from employment of $174,765. That tax return also records non-primary production losses carried forward from earlier income years of $1,170,404, and that $192,399 was claimed as a loss in 2013/14. This resulted in a taxable income of nil for her for 2013/14.
The father said that he collects the child from the mother and has been inside her home which he described as an extravagant property. He said that it is a five bed, two bath, two storey home which, according to realestate.com, was rented at $1,000 a week. The father said that the mother runs two luxury cars, [specified], and although old (2007 and 2006 respectively), they are expensive to maintain.
The father told the tribunal that the mother started a retail business in about January 2017. The mother told the Department on 24 February 2017 that it was her father's business which had not yet traded for a full year, and that she was helping out and not receiving a wage from the business. The father indicated that he did not believe this, saying that the mother's father was [age] years old and works full-time in an unrelated field as a sales representative.
The mother also told the Department on 24 February 2017 that she and three other directors were associated with a business that had not traded since 2008, and carried residual debts. She also told the Department that the profits of the business for which she worked as [an occupation 1] were shared between two shareholders. In relation to overseas properties, she said that she owned them with another person, and the net income shared between them was GBP8,000. According to the Department she said that she was not earning any income and was supported by her father.
The father said at the directions hearing that the mother had started a food retail business in June 2017 which must have cost a lot to open as it started from scratch and all the equipment would have been purchased. At the directions hearing the father said he heard a second food outlet was about to open. At the main hearing he said that he did not know if that was the case.
[28]
How does the administrative assessment compare with an assessment of child support using the tribunal's income figures for the parents?
[29]
The administrative assessment in place when the father lodged his change of assessment application was that his annual child support liability was $7,842, based on his estimate of income for 2016/17 of $149,897 and an adjusted taxable income of nil for 2015/16 for the mother.
The tribunal estimates that using an income of $145,000 for the father and $174,765 for the mother results in a child support liability of $1,189 a year payable by the mother to the father.
Given the difference between $7,842 payable by the father and $1,189 payable by the mother per year, the tribunal is satisfied that in the special circumstances of this case, the administrative assessment does result in an unjust and inequitable rate of child support, and that a ground for departure from the administrative assessment has been established pursuant to subparagraph 117(2)(c)(ia) of the Act.
[30]
Issue 2 - Is it just and equitable to make a particular departure determination?
[31]
As the tribunal is satisfied that there is a ground to depart from an administrative assessment of child support, the next step is to consider whether it is just and equitable as regards the child, the father and the mother to make a particular determination in accordance with sub-subparagraph 98C(1)(b)(ii)(A) of the Act. This in turn requires the tribunal to consider a variety of factors, as set out in subsection 117(4) of the Act.[4]
Section 3 of the Act makes it clear that parents have the primary duty to maintain their child, and that this duty has priority over all commitments of the parents other than commitments necessary for self-support or the support of another person the parent has a duty to maintain. In this case the father and the mother have the primary duty to financially support their son.
[32]
Income, property and financial resources - the father
[33]
As the father's SFC was dated 15 July 2017, some of the information on it is now out of date. He had recorded that he had $5,000 in his bank accounts. The father said that his current bank balance is about $1,000.
The father recorded a liability owed to a bank of $56,000. The father said that he used to own a property which he was obliged to sell in 2016 even though it was a negative equity situation, and that was how the $56,000 liability arose. He said that he is paying it off each month. He recorded a credit card debt of $9,000 which he said is now about $6,700. He also recorded a debt of $7,000 payable to debt collectors. He wrote that he was paying it off at $500 a month and said that he has about $1,000 left to pay on it.
On his SFC, the father recorded both his total income and outgoings to be $3,000 a week. His evidence was that since then, his income has dropped to $129,511 a year ($2,490 a week).
According to the father's SFC, his weekly rent used to be $675 a week. He said that it had dropped to $600 a week, and he was behind in rent by about two weeks. He said that he took that place on when his income was higher and when the lease runs out in November, he will look for a cheaper place. The father allowed $100 a week for entertainment and hobbies, and $50 a week for holidays which is discretionary spending. The father said that he was in a difficult situation financially.
[34]
Income, property and financial resources - the mother
[35]
In her conversation with the Department on 24 February 2017, the mother referred to a deposit she had paid on the property sold by the father in 2016. He confirmed that the mother had paid $100,000 towards the property which was in his sole name as was the mortgage. He said that the mother wanted her $100,000 back as the property was sold but because he was left with a debt to the bank following the sale, he was unable to do that.
[36]
Other issues pertaining to the parents' incomes, property and financial resources
[37]
Subsection 117(7B) of the Act prescribes the circumstances in which a parent's earning capacity may be taken into account; certain criteria have to be met. These include that the parent has failed to demonstrate that decisions made about their work arrangements were not substantially motivated by the effect they would have on the rate of child support.
The father's taxable income was $188,909 in 2015/16 and $159,272 in 2016/17. He submitted an income estimate of $129,511 which applied from 27 July 2017. The father said his pay has reduced over time because of changes made to the basis upon which he is paid commission, plus difficult trading conditions. He has worked for the same employer for over five years. The tribunal is satisfied that it is not open to it to make an earning capacity determination in respect of the father as he has satisfactorily explained his drop in income.
As already discussed under Issue 1, the tribunal has limited information about the mother's income, property and financial resources. It has limited information about any changes she may have made to her work arrangements. The tribunal has arrived at an income for her for child support purposes, based on data included in the most recent tax return (2013/14) included in the evidence. Given that, it serves no purpose to give further consideration to earning capacity in respect of the mother.
In light of the foregoing, the tribunal is satisfied that it need not consider the application of subsection 117(7B) of the Act in relation to either parent any further.
The tribunal is required to have regard to the commitments of each parent that are necessary to enable the parent to support himself or herself, or any other child or another person that the person has a duty to maintain (paragraph 117(4)(e) of the Act). There was no evidence before the tribunal that either party had the duty to maintain other children or another person.
[38]
In determining the proper needs of the children, it is necessary to have regard to the manner in which they are being, and in which the parents expected them to be, cared for, educated or trained, and any special needs they may have (subsection 117(6) of the Act).
The father said that the child attends a private school and he does not contribute to this. He said that he and the mother agreed when their son was born that he would attend this particular school. He said that they separated when the child was 2 years old and he is not able to afford the school fees.
The father said that he understood that a wealthy relative of the mother living [overseas] had undertaken to pay the school fees and tertiary education costs. He also said that he thought the mother would disagree with him saying that a third party was paying the school fees. As the mother has not made a submission about school fees and the tribunal has no additional information about them, it will not consider school fees any further.
As noted the parents share the care of the child equally. Information about the costs of the child is usually provided by the parents when they fill out their SFCs. As the mother has not completed the form, the tribunal does not have all the information that relates to the costs of the child relevant to this review.
In light of this, the tribunal concluded that using the "Costs of the Children Table" is reasonable in the circumstances of this case.[5]
[39]
The tribunal is required to consider any hardship its determination might cause and is guided by Gyselman and Gyselman[6] in this respect:
[40]
This requires the Court to balance the 'hardship' which the parents or the children may suffer as a result of either making or refusing to make the order. It is a recognition of the circumstance that in this area there is likely to be hardship both ways and the Court is required to take into account the balance of that hardship and give it the weight which is appropriate to the circumstances of the individual case.
[41]
The tribunal formed the view that although the father has a reasonable income, he is under some financial strain. This is due in part to his income decreasing over recent years.
There was no evidence before the tribunal indicating that the mother was experiencing any financial hardship.
The tribunal's decision represents a decrease to the child support liability compared to the administrative assessment as referred to under Issue 1 in paragraphs 28 to 30.
[42]
The tribunal may take into account any other matters it considers relevant in making a particular departure determination (subsection 117(9) of the Act).
In her submission to the tribunal made the day before the hearing, the mother wrote that she did not want to place any financial stress on the father because of child support. She referred to agreeing in September 2017 that she had no intention of taking child support from the father from that time.
Both parents have alluded to an issue between them concerning the child's birth certificate and obtaining a passport for him. This is not a matter for the tribunal.
The mother, in her written submission, referred to ending the child support case. From an exchange of texts between the parties which was sighted by the tribunal at the hearing, it appears that the mother had tried to contact the Department by phone to this end but was unable to do so as she was cut off.
The effect of the objection decision made 7 June 2017 was that the father's child support liability reduced from 14 December 2016. As the father was up to date with his payments, that decision meant that the mother had been overpaid child support. Since that decision was made, the father's child support payments (at a lower rate than they had been) continued to be deducted from his pay. He said that he understood that these were being held for him by the Department until such time as the mother's overpayment dropped to nil. He said that he was told by the Department that the amount held for him, and not yet paid to the mother, was $943.97 as at 10 April 2018. Separate to this, departmental records show that as at 20 March 2018, the overpayment to the mother was $318.68.
The father said that he thought it appropriate neither parent paid child support to the other as the care was shared equally. This reflects the mother's view, at least in respect of the period going forward from September 2017 (see paragraph 53). The father said he thought that neither parent having to pay child support to the other should apply from when he lodged his change of assessment on 14 December 2016. He was adamant that he should never have had to pay child support to the mother and the tribunal understood this to be a reference to their respective financial situations.
Using the tribunal's income figures for each parent, the rate of child support payable by the mother would be $1,189 a year ($23 a week) which is not significant when measured against the parents' incomes.
[43]
Issue 3 - Is it otherwise proper to make a particular departure determination?
[44]
The requirement to consider whether a departure determination would be otherwise proper is concerned with what is fair to the community; it is preferable for a child or children to be primarily supported by their parents rather than by government assistance. Paragraph 117(5)(b) of the Act means that the tribunal must consider whether the level of a benefit, in particular family tax benefit, received by the party caring for a child or children, may be affected by the level of child support.
There was no evidence of either party being in receipt of family tax benefit. The tribunal is satisfied that its determination will result in an appropriate apportionment of financial responsibility between the parents and the community, and would be otherwise proper.
[45]
The tribunal sets aside the decision under review and, in substitution, decides that for the period from 14 December 2016 to 31 December 2022, the rate of child support is varied to nil.
[46]
[1] The mother's submission was received the day before the hearing. She had emailed it to the father as well as to the tribunal, so he was familiar with it.
[3] The SSAT (Social Security Appeals Tribunal) was the body that conducted reviews of child support decisions before this function was transferred to the SSCS Division of the Administrative Appeals Tribunal.
[49]
[4] The tribunal is required to give "overt consideration" to relevant factors listed in subsection 117(4) of the Act: Tyagi & Meares[2008] FMCAfam 886.
The Tribunal set aside the decision under review and substituted a determination that, for the period 14 December 2016 to 31 December 2022, the rate of child support is varied to nil.
The father said that he believes that the mother disburses the income she generates to members of her family.
In her submission to the tribunal the mother wrote that the "child support payments would more than likely increase substantially once my income details are officially updated". The tribunal considers it possible that by "income details" the mother was referring to her taxable income. However, as will be apparent from these Reasons for Decision, the tribunal can determine that a person's taxable income does not adequately reflect their income, property and financial resources, and can determine a different income figure to be used for child support purposes.
The tribunal is of the view that due to the limited information it has about the mother's income, property and financial resources, it is appropriate to rely on the most recent tax return information it has sighted which is for 2013/14, and considers that the mother's income for child support purposes is $174,765.
The tribunal has determined that neither parent is to pay child support to the other which reflects both parents' views going forward. The tribunal has decided its determination is to start from 14 December 2016 which will increase the amount by which the mother has been overpaid. The tribunal considers this to be reasonable given the principle embodied in the quote from Conway at paragraph 18 above.
The tribunal's determination ends 31 December 2022 which is the same end date used in the objection decision. It may be that the parties have taken steps to close the child support case well before then. If not, it is open to either parent to lodge a further change of assessment application if their circumstances change.