Formula 3&4 - a parent has multiple child support cases

• When analysing markets, a range of assumptions are made about the rationality of economic agents involved in the transactions
• The Wealth of Nations was written

  1776
• Rational


  (in classical economic theory) economic agents are able to consider the outcome of their choices and recognise the net benefits of each one
• Consumers act rationally by


  Maximising their utility
• Producers act rationally by


  Selling goods/services in a way that maximises their profits
• Workers act rationally by


  Balancing welfare at work with consideration of both pay and benefits
• Governments act rationally by


  Placing the interests of the people they serve first in order to maximise their welfare
• Rationality in classical economic theory is a flawed assumption as people usually don't act rationally
• Marginal utility


  The additional utility (satisfaction) gained from the consumption of an additional product
• If you add up marginal utility for each unit you get total utility
• Calculating child support income for a parent with multiple child support cases

  1. Take parent's ATI for that case

  2. Deduct self-support amount

  3. Deduct relevant dependent child amount (if applicable)

  4. Deduct multi-case allowance (if applicable)
• Combined child support income

  Sum of each parent's child support income
• Income percentage


  Each parent's child support income divided by combined child support income, multiplied by 100
• Percentage of care


  Percentage of time each parent/carer spends caring for the child
• Cost percentage


  Percentage of the child's costs that each parent/carer is responsible for
• Child support percentage


  Parent's income percentage minus their cost percentage
• Calculating costs of the child

  1. Use Costs of the Children Table based on child's age and number of children

  2. Add any additional costs over base amount
• Calculating annual child support payable

  Child support percentage x costs of the child
• Calculating multi-case cap


  (100% - parent's cost percentage) x multi-case child costs for that child
• Child support payable is the lower of the amount calculated in step 8 or the multi-case cap calculated in step 9
• Formula 4 is used when one or both parents have at least one other case, and one or more non-parent carers has at least 35% care of a child
• Aliya has an ATI of $45,000 and Edmund has an ATI of $70,000
• Kristina lives full time with Edmund and Harriette lives full time with a grandparent Ali
• Ali has made an application under section 25A for a child support assessment
• Step 1: Work out each parent's child support income


  1. Work out each parent's ATI for this case

  2. Deduct the self-support amount

  3. Deduct a relevant dependent child amount, if applicable

  4. Determine multi-case child costs for each of the children in each parent's other child support cases

  5. Deduct a multi-case allowance amount

  6. Each parent's child support income
• Aliya's child support income is $20,203 and Edmund's child support income is $51,748
• Step 2: Work out the combined child support income

  Add Aliya's and Edmund's child support incomes
• The combined child support income is $71,951
• Step 3: Work out each parent's income percentage


  1. Divide each parent's child support income by the combined child support income

  2. Multiply the resulting amount by 100
• Aliya's income percentage is 28.08% and Edmund's income percentage is 71.92%
• Step 4: Work out each parent's percentage of care for each child

  1. Aliya has 0% care of Kristina and Harriette

  2. Edmund has 100% care of Kristina and 0% care of Harriette
• Step 5: Work out each parent's cost percentage for each child

  1. Aliya has a cost percentage of 0% for Kristina and Harriette

  2. Edmund has a cost percentage of 100% for Kristina and 0% for Harriette
• Step 6: Work out each parent's child support percentage for each child

  Deduct each parent's cost percentage from their income percentage
• Aliya is responsible for 28.08% of the costs of Kristina and Harriette

  Edmund is entitled to receive child support from Aliya for Kristina and is required to pay child support for Harriette
• Step 7: Work out the costs of each child

  Use the relevant Costs of the Children Table to calculate the total costs of Kristina and Harriette
• The total costs of Kristina are $9,953 and the total costs of Harriette are $8,154
• Step 8: Work out the annual rate of child support payable by the parent with a positive child support percentage


  Multiply the paying parent's child support percentage by the costs of the children
• Aliya is liable to pay Edmund $2,795 for Kristina and $2,290 for Harriette

  Edmund is liable to pay Ali $5,864 for Harriette
• Step 9 (if applicable): Work out the multi-case cap


  1. Work out the multi-case child costs for the children in the child support case

  2. Work out the multi-case cap for each child
• The multi-case cap is $2,368 for Kristina and $1,998 for Harriette

  As the amounts calculated at step 8 are more than the multi-case caps, the multi-case caps are payable by Aliya