How Child Support Is Calculated in Australia: The 8-Step Formula Explained

Child support isn't arbitrary — it's a formula

If you're separating and have children, one of the first financial questions you'll face is child support. Many parents assume the amount is negotiated or decided by a judge, but in the vast majority of cases, it's calculated by Services Australia using a fixed 8-step formula set out in the Child Support (Assessment) Act 1989.

Understanding this formula removes a lot of the anxiety. It's not someone's opinion — it's maths. And once you know the inputs, you can estimate the outcome before you even apply. Use our Child Support Estimator to run your own numbers.

Important: This article is general information only. It is not legal or financial advice. For advice specific to your situation, contact Services Australia or a family lawyer.

The 8-step formula explained

Step 1: Work out each parent's child support income

Services Australia starts with each parent's adjusted taxable income. This includes taxable income, reportable fringe benefits, target foreign income, net investment losses, and certain tax-free pensions or benefits. For most PAYG employees, it's close to your gross salary minus tax deductions.

If you're self-employed, the calculation can be more complex — Services Australia may look at your tax return over multiple years or make an income estimate based on earning capacity.

Step 2: Subtract the self-support amount

Each parent gets a deduction called the self-support amount — a figure that represents the minimum you need to support yourself. For the 2025-26 financial year, this amount is $28,463 (indexed annually, based on one-third of the annualised Male Total Average Weekly Earnings).

If Parent A earns $95,000 and Parent B earns $55,000:

• Parent A's child support income: $95,000 - $28,463 = $66,537
• Parent B's child support income: $55,000 - $28,463 = $26,537

Step 3: Work out the combined child support income

Add both parents' child support incomes together:

$66,537 + $26,537 = $93,074 combined child support income.

Step 4: Work out each parent's income percentage

Each parent's share of the combined income determines how much of the children's costs they're responsible for:

• Parent A: $66,537 / $93,074 = 71.5%
• Parent B: $26,537 / $93,074 = 28.5%

Step 5: Work out each parent's care percentage

This is where the number of nights matters. Services Australia converts nights of care into a percentage, which is then placed into one of five care bands. Use our Care Percentage Calculator to see exactly where you fall.

The five care bands are:

Step 6: Work out each parent's child support percentage

Subtract each parent's cost percentage (from the care table) from their income percentage (from Step 4). A positive result means that parent pays child support. A negative result means they receive it.

Step 7: Work out the costs of the children

Services Australia uses a Costs of Children Table that varies by the combined child support income, the number of children, and their ages (under 13, 13 and over, or mixed). For example, for two children under 13 with a combined income of $93,074, the costs of the children might be around $24,500 per year.

These tables are updated annually and are available on the Services Australia website.

Step 8: Calculate the child support amount

Multiply the paying parent's child support percentage (Step 6) by the costs of the children (Step 7). That gives you the annual child support liability, which is then divided into monthly, fortnightly, or weekly payments.

The minimum annual rate

Even if the formula produces a very low amount, there's a minimum annual rate of child support. For 2025-26, this is $540 per year (roughly $10.38 per week). This applies when the paying parent has a very low income or is on Centrelink payments.

What income cap applies?

There's also a cap on the income used in the formula. For 2025-26, the child support income cap is approximately $191,000 (2.5 times the annualised Male Total Average Weekly Earnings). Income above this cap is not included in the formula — though the receiving parent can apply for a change of assessment if they believe the paying parent's lifestyle suggests a higher contribution is appropriate.

Private agreements vs assessments

You don't have to use the formula. Parents can make their own arrangements:

• Child support agreement: A formal agreement registered with Services Australia. Can be a binding agreement (requires independent legal advice for both parties) or a limited agreement (must be at least the assessed amount).
• Private arrangement: An informal agreement between parents. Not enforceable through Services Australia if one party stops paying.

If you go with a private arrangement, it's worth running the formula anyway so you know what the baseline would be. The Child Support Estimator gives you that number in seconds.

When assessments change

Your child support assessment isn't set in stone. It can change when:

• Either parent's income changes significantly
• Care arrangements change (even a shift of one night per week can move you between care bands)
• A child turns 13 (the costs of children table changes)
• A child leaves the assessment (turns 18 or finishes secondary school)
• Either parent has another child from a new relationship

If your circumstances have changed, read our guide on how to change your child support assessment and use the Child Support Change Calculator to estimate the impact.

Where to get help

Child support can be one of the most stressful parts of separation. These free resources can help:

• Services Australia: servicesaustralia.gov.au/child-support or call 131 272
• Family Relationship Advice Line: 1800 050 321 (free call, available 8am-8pm Mon-Fri, 10am-4pm Sat)
• Legal Aid: Available in every state and territory for eligible parents

For a full list of free services, see our guide to free separation resources in Australia.