CHILD SUPPORT - departure determination - income, property and financial resources - limited income vs stable income - modest access to financial resources - decision under review set aside and substituted

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been omitted from this decision and replaced with generic information pursuant to subsection 16(2AB) of the Child Support (Registration and Collection) Act 1988.

1. Mr Rahbari (the father) and Ms Guadalupe (the mother) are the parents of one child, who is currently nine years old, for the purposes of the child support assessment under review.
2. A child support case was first registered with Services Australia - Child Support (Child Support) on 31 October 2019 and child support has been registered for collection by Child Support.
3. On 15 March 2024 the mother applied for a change to the administrative assessment which at that time assessed the father's child support liability at $0 per annum. This was based upon his 2022/23 adjusted taxable income ("ATI") of $39,424 and the mother's 2022/23 ATI of $88,687.
4. On 17 July 2024 a Child Support officer, acting as a delegate of the Registrar, found that a ground for departure was established and accordingly decided that for the period 1 March 2024 to 31 May 2026 the father's ATI was to be set at $100,000.
5. The father objected to this decision and on 28 October 2024 the objections officer partly allowed the objection and found that a ground for departure was established and accordingly decided that for the period 1 March 2024 to 31 October 2026 the father's ATI was to be set at $90,867.
6. Both parents subsequently applied to the Administrative Review Tribunal for an independent hearing of Child Support's decision.
7. A hearing was held into the matter on 28 July 2025. Both parents gave evidence by conference telephone.
8. Pursuant to paragraph 98C(1)(b) of the Child Support (Assessment) Act 1989 (the Act), a decision to depart from the administrative assessment may be made if the following requirements are met:

(i) that one, or more than one, of the grounds for departure referred to in [subsection 117(2)] exists; and

(ii) that it would be:

• (A) just and equitable as regards the child, the liable parent, and the carer entitled to child support; and
• (B) otherwise proper; ...

The parents' incomes and access to financial resources

1. Subparagraphs 117(2)(c)(ia) and (ib) of the Act, commonly referred to as Reason 8, provide as grounds for departure:

(c) that, in the special circumstances of the case, application in relation to the child of the provisions of this Act relating to administrative assessment of child support would result in an unjust and inequitable determination of the level of financial support to be provided by the liable parent for the child:

(ia) because of the income, property and financial resources of either parent; or

(ib) because of the earning capacity of either parent; ...

1. The term "special circumstances" is not defined in the legislation. In Gyselman and Gyselman [1991] FamCA 93; (1992) FLC 92-279, the Full Family Court indicated that for special circumstances to exist, the facts of the case must establish something which is special or out of the ordinary.
2. The father is a self-employed [Occupation 1]. He [subleases one asset of his business to an employee]. He [uses the other asset] himself. The father supplied bank statements and financials that I requested.
3. I discussed with the father that it is a well-established principle that the taxable income of a person who is self-employed may not be an accurate reflection of their earning capacity and financial resources (DJM and JLM [1988] FamCA 97, Scott and Scott [1994] FamCA 12; (1994) FLC 92-457, Carey and Carey [1994] FamCA 74; (1994) FLC 92-489). When summarised, these cases establish that a ground of departure is established if self-employed people are able to derive additional benefits from their businesses, and also have a greater control over the structure of their finances than a PAYG employee.
4. The father's 2024/25 taxable income is estimated as $30,653. His profit and loss statement reflects gross business income of $111,180 and a net profit of $25,369. I note that 2025 first and second quarter Business Activity Statements ("BAS") are generally reflective of the above gross income figure.
5. The father's business claimed $11,806 in depreciation expenses related to [assets]. The father gave evidence that he is trying to sell [Asset 1]. He is also trying to find another job but has not been able to. His plan at the moment is to run the new [asset] for a long time. He has no plans to purchase another [asset] as the [business] has been deteriorating for a number of years now.
6. The Department's Child Support Guide discusses the treatment of depreciation as follows:[1]

Depreciation represents the loss or expense attributed to the use of business property or equipment. It is an entry in the business account that is not necessarily an expense that is actually incurred by the business. The aim of depreciation is to spread the cost of a capital asset (for example, motor vehicle, plant and equipment, machinery, building) over the period of its useful life, with a portion of the cost being expensed each financial year.

A claim for depreciation can mean that a parent has financial resources available to them that are not necessarily reflected in their taxable income or the resources of the business. In cases that involve depreciation, the Registrar will determine whether receiving a benefit through claiming depreciation expenses results in a parent having greater financial resources or income than their taxable income would indicate. The Registrar will consider a parent's complete financial situation including the business' overall financial position and the individual circumstances of the case.

Example: If business income is reduced by $10,000 as a result of depreciation and that amount is then used for day-to-day personal expenses the depreciation amount may be considered as an additional resource and added back to the parent's ATI.

Before depreciation expenses can be taken into account as income or a financial resource personally available to the parent, the underlying nature of the depreciation expense must be determined. If the amount claimed as depreciation is used or set aside for replacing equipment (for example, a capital replacement fund) or is actually accounted for as part of ongoing business activities (for example, to repay a loan on a depreciating asset or to otherwise reduce business debt), then this is unlikely to provide the parent with additional financial resources. Similarly, if the business operates at a loss even after accounting for depreciation expenses, these expenses will not be available to the parent as a personal financial resource. On the other hand, if the parent spends the benefit of depreciation on day-to-day living expenses or recreational expenses this will most likely be a reason for changing the assessment.

The Registrar can also consider the asset that is the subject of the depreciation expense, whether the asset is used for both business and private activities and whether the written down value is a reflection of market value.

1. While not bound by policy, in Drake and Minister for Immigration and Ethnic Affairs (1979) 2 ALD 60 it was established that a Tribunal should take into account government policy that is not inconsistent with the provisions or objects of the legislation. I am satisfied that the policy in this instance is not inconsistent with the objects of the legislation.
2. I accept that the new [asset] purchase was fully financed at the time of purchase. The bank statements supplied by the father reflect monthly repayments to [Finance company 1] of around $1,300. I therefore accept that the depreciation amount is being used to repay a loan on the capital asset. As such the benefit of the depreciation has not been used by the father on ordinary living expenses and it is not appropriate to add it back.
3. The father gave evidence that the [asset] serves [personal purposes too]. He agreed that he uses it for personal purposes and that all expenses associated with the [asset] are put through the business. He submitted that he has limited personal use of the [asset]. I am satisfied that the father obtains a personal benefit from his use of the [asset]. He also puts his phone and internet costs through the business.
4. An ordinary wage earner must purchase and maintain [assets], phone and internet using after tax dollars. They must pay for [fees] and purchase costs and cannot claim depreciation. The objections officer attributed an amount of $15,000 to the father in recognition of the personal benefits he derives from the business. I am satisfied that this amount is reasonable and this takes into account any other potential personal expense claims embedded in the business accounts.
5. With respect to the second [asset] the objections officer found that this was worth $30,000 per annum to the father. The father took issue with this. He agreed that he charges [an employee] $800 per week however this goes into the gross income of the business. As such expenses associated with the [asset] such as [fees], registration and insurance are paid for from this payment. The mother submitted that in the past the father had two [employees] using this [asset] 24 hours a day and they paid him in cash. The father submitted he only has one [employee] now and no one pays in cash for [the service] anymore so all income can be traced and audited.
6. On balance I find the father's arguments reasonably persuasive especially with respect to people's expectations to pay for expenses using non-cash means. I am satisfied that the BAS, bank accounts and tax returns reflect income from both [assets] received by the father. As discussed during the hearing it is very difficult to account for cash income. I will examine the father's overall assets and liabilities and lifestyle factors to determine if there is any indication of significant cash income in my just and equitable considerations later in these Reasons. I accept that the other expense items claimed by the business are reflective of deductible business expenses generally associated with the [business].
7. Based on the above considerations I am satisfied that the father's income and overall access to financial resources at the time of the mother's application for departure from the administrative assessment was equivalent to an adjusted taxable income of $45,653.
8. I have also reviewed the mother's income and overall access to financial resources. She is employed as an ordinary wage earner at arm's length. There is nothing before me that would indicate an adjustment to her ATI, as used at the time of the departure application of $88,687, is warranted.
9. Under the administrative assessment the annual rate of child support payable by the father at the time of the mother's application for departure from the administrative assessment was nil. Given the above considerations, I calculate that the annual amount of child support payable by the father at that application date was approximately $1,708 per annum.[2] Such a difference in the child support payable constitutes special circumstances as the application of the assessment would result in an unjust and inequitable determination of the level of financial support to be provided by the father in support of the child. As a result, a ground for departure in subparagraph 117(2)(c)(ia) of the Act exists.

Would departure from the assessment be just and equitable?

1. The father submitted a statement of his financial circumstances. This statement reflects that he has been [an Occupation 1] for the past decade. Other than his [assets] he listed a crypto investment with a value of $14,700. He told me he made this investment some years ago and its value was accounted for in the property settlement with the mother. He said it has not increased in value. The mother did not dispute this evidence. He also listed minimal bank account balances and nil superannuation. He listed debts of $47,530 owed to [Finance company 1], $7,957 owed to his bank credit card (which is reflected in the latest credit card statement he provided), and $19,000 that he borrowed from a friend and which he used to meet separation and settlement costs incurred in separating from the mother. He does not have a legal agreement with respect to the borrowing from his friend. He listed personal expenditure of $40 per week for his credit card and $850 per week for household expenses. He rents privately and splits this rent equally with a housemate. He now pays $275 per week in rent himself. In total this is equivalent to expenditure of around $29,300 per annum.
2. I note that the father does not pay himself a traditional wage and rather he withdraws money from his business account. He stated this was $1,500 per fortnight or $39,000 per annum. I accept this is what he does as it is reflected in his bank statements as an ATM withdrawal. As such he is not contributing to his superannuation. He is also not paying regular instalments for personal tax and as such derives some benefit by deferring this cost on income. I was unable to discern any lifestyle factors of the father that may reflect undisclosed cash income. However overall, I am satisfied that the father can afford to pay a bit more than the modest child support payment of some $33 per week or $1,708 per annum, as set out above, without placing him in undue hardship especially as he has taken commendable steps to reduce his weekly rent from $699 to $275 by taking in a flatmate. Overall, after this change, the father will earn more than he spends on a weekly basis on necessary costs for self-support. According to his income estimate, after offsets, he will only be required to pay tax of $1,371.70 including the Medicare levy. This leaves him with approximate overall access to financial resources of around $44,000 per annum or $851 per week. This leaves him with nominal free cash, after necessary disclosed costs of $30,000, of around $14,000 per annum or $269 per week. However, I am also mindful that this expenditure disclosure includes only a minimum repayment of debts including his credit card and appears somewhat conservative in its estimates.
3. Weighing the above up, I consider it to be just and equitable to raise the father's weekly child support contribution to $50 or $2,600 per annum to acknowledge his generally low costs of living in comparison to his overall access to financial resources, and by a further $200 per annum for each following year to account for the rising costs of living. He also has the crypto investment available to him should he require it.
4. The mother has also supplied a statement of her financial circumstances. She has been employed full time at a university for the past three years. She listed her income from employment and family tax benefit as her income sources. She informed me that she is currently single. She listed a modest bank balance and an old [car] as her vehicle. She has around $34,000 in superannuation. She owes Centrelink $2,372.24 for overpaid family tax benefit. She also informed me that she had recently taken out a $725,000 mortgage and borrowed money from family to purchase a house. While the mother made submissions that a reduction in child support payable would cause her hardship as she now has a mortgage to service, I was not convinced by this argument. Her decision to become a homeowner and take out a sizable mortgage reflects confidence in her financial situation. Additionally, I am only concerned with the proper needs of the child being provided for according to the capacity of each parent to do so after their necessary costs for self-support have been met. Unlike the father, the mother has stable employment conditions that enable her to make long-term financial plans.
5. In determining the proper needs of the child, it is necessary to have regard to the manner in which the child is being, and in which the parents expected the child to be, cared for, educated or trained, and any special needs of the child (subsection 117(6) of the Act). In Eades & Cadell (SSAT Appeal) [2009] FMCAfam 275, at paragraph 22, Slack FM stated as follows:

In considering the proper needs of the child [s 117(4)(b)], the SSAT:

1. would ordinarily consider the evidence of the parties about the needs of the children to assess the reasonableness and quantum of those needs;
2. may have regard to publish guidelines as to the needs of the children (see Hallinan & Witynski at 94.323);
3. may also have regard to the costs of children used in the assessment of child support under the existing formula arrangements [although it is not sufficient or appropriate to rely upon the formula to perform that task, Lindenmayer J in Dwyer & McGuire (1993) FLC92-420 (and see also Gyselman (supra) at 79.078)].

1. No special needs costs or education costs were raised with respect to the child. Overall, I consider this an appropriate case to firstly assess the proper needs of the child using the Child Support Calculator maintained by Child Support, which is based on social science research and uses the care recorded and the age of the child, amongst other factors, to calculate child support payable based upon the ATI of the parents and to then make an adjustment to that base figure payable, based on my just and equitable considerations set out above in these Reasons.[3]

1. I consider that it is just and equitable to depart from the administrative assessment of child support payable in this matter.
2. With respect to an appropriate date range for this departure determination I consider the commencement date of 1 March 2024, as set by the objections officer, is appropriate. I note that the mother requested backdating before her date of application. However, I consider this has the potential to create financial hardship for the father given his limited income and I decline to backdate accordingly. I consider a longer period of departure is appropriate. Neither parent raised any potential significant changes in their situations going forward. I will set an end date of 30 June 2028. This allows for the parents to plan their respective affairs with some certainty.
3. As discussed during the hearing the principal object of the Act is to ensure that children receive a proper level of financial support from their parents. Further, the Tribunal notes the statements contained in sections 3 and 4 of the Act to the following effect:
   • parents of a child have a primary duty to maintain the child;
   • the duty has a priority over all other commitments of the parent other than commitments necessary for self-support;
   • the level of financial support to be provided by parents to their children should be determined in accordance with the legislatively fixed standards; and
   • the level of financial support is to be determined according to the capacity to provide financial support and noting that parents with a like capacity to provide financial support should provide like amounts.
4. Taking these principles into consideration I am satisfied that an appropriate departure determination in this matter is as follows:
   • For the period 1 March 2024 to 30 June 2025 the annual rate of child support payable by the father is varied to $2,600.
   • For the period 1 July 2025 to 30 June 2026 the annual rate of child support payable by the father is varied to $2,800.
   • For the period 1 July 2026 to 30 June 2027 the annual rate of child support payable by the father is varied to $3,000.
   • For the period 1 July 2027 to 30 June 2028 the annual rate of child support payable by the father is varied to $3,200.
5. This departure determination will require the father to make weekly child support payments of around $50 per week at commencement rising to around $62 per week in the final year. This will not be affected by the mother's income which she gave evidence can rise if she works overtime. I have considered the respective arguments of the parents with respect to hardship. Neither parent provided compelling evidence that a departure application along these lines would cause them undue hardship. I am satisfied that neither parent will be placed in undue hardship by this decision. There is a significantly proportional reduction in the weekly child support payable by the father, when compared to the decision of the objections officer, providing him with some financial relief. The mother also has the freedom to pursue activities to raise her income, such as working overtime, without this adversely impacting the amount of child support otherwise payable to her. The father is in arrears and as such a rebalancing of this amount outstanding should not cause an overpayment to the mother. Both parents can now plan their affairs and the support of the child with some degree of certainty. Seen in light of this, and the legislative requirement with respect to the priorities of the legislation, I consider that this departure decision is just and equitable.

1. I am satisfied that changing the amount of child support payable will not have any adverse effect upon the community as this decision results in the parents being required to pay child support according to their actual capacity to do so. Such a result would be otherwise proper.

The Tribunal sets aside the decision under review and, in substitution, decides that:

• For the period 1 March 2024 to 30 June 2025 the annual rate of child support payable by Mr Rahbari is varied to $2,600.
• For the period 1 July 2025 to 30 June 2026 the annual rate of child support payable by Mr Rahbari is varied to $2,800.
• For the period 1 July 2026 to 30 June 2027 the annual rate of child support payable by Mr Rahbari is varied to $3,000.
• For the period 1 July 2027 to 30 June 2028 the annual rate of child support payable by Mr Rahbari is varied to $3,200.

[1] 5.2.8 Reason 8A - a parent's income, property & financial resources | Child Support Guide (accessed 28 July 2025)

[2] As a guide see Child Support Calculator | Estimator | Child Support Australia

[3] Online estimators - Accessing our services - Services Australia