Application for Child Support to be collected 277-04030000

A payee can make an AFC verbally or in writing (AFC form). If the payee resides overseas, they can lodge an AFC personally or it can be lodged on their behalf by an overseas authority of the reciprocating jurisdiction.

Note: the particulars of an AFC can vary until the AFC is 'Accepted', that is, processed in Cuba and letters issued to customers. For example, if the payee claimed $400 of arrears and through discussions with both parents it was agreed $100 was also paid to the payee for child support during, or specifically for, the claimed opt in arrears period, the total claimed arrears would be adjusted to $300.

If the customer is the payee in multiple cases, confirm which case/s they want collection to take place on.

A customer is now a payer (due to a recent role reversal) may still apply for collection where they were previously the payee, see Step 1 in Table 6.

If the application for collection is for a reverse case (where the customer roles have changed), go to Step 5.

Occasionally a payee may request collection of child support for children that are not registered on the case. In this situation, before actioning the AFC, the payee must be offered the option to apply for either an assessment or a registration of a court order to register the children.

Advise the payee that collection can only start from the date Child Support receive the completed registration application, not the date the AFC was lodged.

If the AFC is for a Stage 1 case, go to Step 4. Otherwise, go to Step 5.

If the payee cannot be located on Cuba, contact them to:

• determine if they have an existing case - if so, what is their Case Number/CSRN/CRN
• confirm the correct spelling of their name, the payer's name and/or the children's names

The Child Support Registrar is only authorised to collect TFNs in writing. Do not ask the customer for their TFN over the telephone. Only add the customers TFN to the Parent Referral and Assessment Guide Workflow if it is already recorded in Cuba.

If this additional information locates an existing:

• Stage 1 case, go to Step 4
• Stage 2 case, go to Step 5

If an existing case still cannot be located, offer the payee the option to apply for either an assessment or a registration of a court order.

Note: if the payee elects to apply for a registration refer to New Customers.

If the payee cannot be contacted by telephone and an existing case cannot be identified, issue a MXO-1 unique letter Application for collection refused - Applicant to the payee, see Letters Cuba process help.

This letter advises the payee that an existing child support case cannot be identified and is therefore unable to accept their AFC. If this letter has been issued then this is the end of the AFC procedure.

An AFC cannot be accepted for a Stage 1 case if the payer is currently in a low-income non-enforcement (LINE) period in relation to the liability - S39(3) of the Child Support (Registration and Collection) Act 1988 (the Act).

Check the Case Collection Details window to see if there is a LINE period in place.

If there is no LINE period, lock both customers and go to Step 5.

If a LINE period exists, use the Centrelink/Child Support Information exchange macro to check that the payer still meets the Prescribed Income Test (PIT).

If CSU's response is that the payer does meet the PIT, then the AFC must be rejected. See Step 2 in Table 7.

If CSU's response is that the payer does not meet the PIT, end the LINE period.

Lock both customers and take action to end the LINE period. AFC procedure ends here.

If the person is calling about collection on a reverse case because the customer roles have changed and they have recently become the payee for the first time, an application for collection may not be necessary because the case should have been recorded as Collect. For initial role reversals, see Table 2 in Managing reverse child support cases.

If the payee is calling about a subsequent role reversal in a case where they have previously been a payee, take the AFC as normal.

A 'first time' AFC applies where the case has been private collect since the most recent start date of the liability. This includes cases that were child support collect but the case ended and has restarted as a private collect case. Go to Step 7.

A 'subsequent' AFC applies where there was a prior collection period on the case during the current registration. For example, a case was child support collect, is currently private collect and the payee is asking for child support collection again. A subsequent AFC includes cases where the agency has made the case private. Go to Step 8.

An AFC is not required for cases:

• with an initial assessment of zero annual rate, see Finalising the child support assessment application, or
• where the customer's roles have reversed and the customer is the payee for the first time, see Managing reverse child support cases

The References page contains a link to collection policy information about zero annual rates and first time role reversals.

When a payee registers or re-registers their case and elects to collect child support privately, they are making an election under either s23(3) for a Stage 1 case or s24A(2) for a Stage 2 case.

Section 25(1) of the Act allows the payee to reverse that election, asking for collection of child support on their behalf. A payee may also make an election under S28A of the Act to have arrears collected for them.

A 'first time' AFC must be accepted.

A payee may make an application for collection for a liability that has never previously been collected. Child Support must accept the s25(1) application for collection in these cases. They may also make an election under s28A of the Act to have arrears collected for them. If there are arrears payable to them, Child Support must accept the s28A election.

See Step 1 in Table 2.

When a customer asks to change their collection arrangement from collect to private collect (by 'opting out'), they are choosing to do so under s38A of the Act. Child Support can also initiate an opt out, under s38B of the Act via the Registrar Initiated Private Collect (RIPC) process.

Section 39 of the Act allows the payee to reverse that election, again asking for collection on their behalf. A payee can also apply under s39A of the Act for the collection of arrears. Payees can ask for collection regardless of whether the previous action to make the case private collect was initiated by the customer or the agency.

Note: consider family and domestic violence concerns when making a decision on a subsequent AFC.

A subsequent AFC must be granted unless Child Support is satisfied that:

• the payer has complied with their child support obligations
• the payer has explained why their payments were untimely, they have rectified this and regular payments are now being made
• special circumstances exist which make it appropriate to refuse the application

See the References page for a link to The Child Support Guide 5.6.3: Reapplying for collection for definitions and examples of 'complying with child support obligations' and 'special circumstances'.

If the payer has been complying with their child support obligations, or after speaking with the customers it is determined that special circumstances exist, see Step 2 in Table 7.

If none of the conditions where Child Support may refuse the AFC are met, see Step 1 in Table 2.

Contact the payee to conduct a pre-collection interview. If unable to contact, send a Receiving parent contact before AFC Opt In is accepted (MOI7-2) letter, see Letters Cuba Process Help. Continue to make phone contact attempts.

Use the Application for Collection macro to document an AFC call with the payee:

Ask the Risk Identification Question in the macro

If the payee answers:

• Yes, go to Step 2
• No, go to Step 3

Have an informative discussion about the steps involved in an AFC, including:

• the need to contact with the other parent, and
• potential enforcement including EW/EWA, TRIP, DPO and litigation

If the Payee indicates they would like to discuss exemption options with a social worker, warm transfer them to the Social Workers.

After explaining all steps involved in the AFC, does the payee want to continue with their AFC?

• Yes, go to Step 3
• No/ unsure, refer the payee to Parent Support Team

Continue with the macro to:

• determine the circumstances behind the collection request, go to Step 4
• discuss current assessment and payee details, go to Step 5
• determine amounts of any unpaid child support, go to Step 6
• discuss payment cycles/periods, options, rights and responsibilities, go to Step 9
• obtain payer details which may assist collection activities and discuss payment methods and any other issues identified, go to Step 11

Explore the reasons why the payee is lodging an AFC. Explore other options where appropriate. Examples of possible reasons as to why payee lodge an AFC include:

• Centrelink advised the payee to apply
• a friend told the payee that collection by the agency was the best option
• one or several payments have been missed or late
• either customer may have moved location
• a life event may have occurred which has influenced the customer's decision, for example, either customer has re-partnered, birth of a new child
• the parties may have recently separated after a period of reconciliation
• the parent is at risk or is experiencing family and domestic violence

Note: if the applicant indicates they had reconciled with the other party during the private collect period, decide if a suspension or termination of the assessment is appropriate for that period. See the References page for a link to the Child Support Guide 2.10.1: Suspension of liability to pay child support when parents reconcile.

Private collection of child support is the preferred option. Where appropriate take every opportunity to encourage private arrangements.

It may not be appropriate to encourage private arrangements in some circumstances including:

• where there is a risk of family and domestic violence
• there is information to suggest the assessment may be subject to retrospective changes
• the customer has been advised by Centrelink to apply for collection because of impacts on their Family Tax Benefit Part A entitlement
• when the payer is incarcerated and:
• the payee cannot collect payments
• incomes are not accurate

If cash payments were being made to the payee, are there other suitable options for private payment that can be arranged between the customers? For example, transfer of payments from the payer's bank account to the payee's bank account or could the payer arrange to have salary deductions transferred into the payee's bank account?

If an agreement can be negotiated for periodic and non-periodic amounts, see Agreements.

Have the payee’s concerns been resolved in other ways?

• Yes, the payee no longer requires collection, see AFC not to proceed
• No, their concerns were not addressed, go to Step 5

Confirm the following:

• Are the current and / or previous incomes accurate?
• Have tax returns been lodged or will be lodged?
• Can the payer lodge an ITD to replace any default incomes?
• Can an estimate be lodged?
• Consider all options including Change of Assessment in special circumstances?
• Are all relevant dependent children reflected on the assessment?
• Is the correct level of care reflected on the assessment details?
• If the income being used in the assessment during the 3 to 9 month opt in arrears period is subject to future changes, for example, an unreconciled estimate or default income, this may later have an impact on the opt in arrears
• Is there a court orders or child support agreement that impacts the rate of child support payable? If yes and it is not recorded in Cuba ask the payee to provide a copy within 7 days

Establish the payment record by asking about payments received during, or specifically for, the private collect period. Consider:

• amounts paid in recent months
• dates payments were made
• how payments were made
• to whom payments were made
• in kind payments
• for what period payments were made (customers may consider the payments to be in advance or in arrears)
• whether payments were intended for child support
• whether the applicant had reconciled with the other party at any time during the private collect period

With this information determine if the payments:

• have been more or less than the liability
• have not or have been paid by the date the customers agreed to

Customers must provide evidence of any payments made/received especially if there is a dispute about the arrears.

Note: a request for opt in arrears cannot commence before the registration date because no liability exists.

Overpayment

Where a cash overpayment exists, advise the payee how it will affect the first and possible future payments. The payer has the option to waive the amount of the overpayment. Waiving an overpayment will not result in any funds changing hands, but merely reduces the overpayment. For overpayment waivers, see Child support overpayments and other payee debt.

Excess NAP credits

Where there are excess NAP credits on the account from a previous collect period, check that these amounts should have remained on the account. See the References page for a link to the Child Support Guide 5.3.1: Non-agency payments. If the credits should remain, advise the payee how it will affect the first and possible future payments.

Request up to 3 months arrears

The payee may:

• choose not to make an application for collection of arrears when opting in
• request collection of child support that has not been paid in the 3 months before the opt in date, or
• make an application for collection of arrears after the opt in is finalised

There is no legal limit to how long the payee can wait to make this application they may ask for arrears to be collected many months after the opt in is accepted.

Advise the payee to notify Centrelink if their application for collection of arrears is accepted as there may be an impact on their FTB entitlement for the private collect period. The payee will need to provide Centrelink with the date that the arrears period covers and any amounts of child support privately paid for the arrears period.

Notify the payer that the 'opt in' amount has been amended and is going to be due and payable. Discuss the circumstances behind the collection request and the best payment arrangement for the payer's circumstances. Follow collection as per Step 1 in Table 5.

Make sure the applicant and the other party did not reconcile for any period during the private collect period. This will affect the amount of arrears the applicant can claim. Advise the payee this may affect their FTB.

Request for more than 3 months of arrears

If the payee has requested more than 3 months arrears to be collected, Child Support must be satisfied that 'exceptional' circumstances existed before accepting the application. See the References page for a link The Child Support Guide 5.1.4: Collection of arrears accrued during non-collect period which provides guidance and examples of exceptional circumstances.

Advise the payee to notify Centrelink if their application for collection of arrears is accepted as there may be an impact on their FTB entitlement for the private collect period. The payee will need to provide Centrelink with the date that the arrears period covers and any amounts of child support privately paid for the arrears period.

The authorisation to approve a payee's application for more than 3 months arrears is at the Service Officer 4 (SO4) level. When considering such an application, the payee must be advised that the payer's response to the statements about the exceptional circumstances will be sought.

Note: in some cases there will be sensitive issues involved for example, the payee’s exceptional circumstances may be due to a medical condition or family and domestic violence. The payer needs to know the substance of the claim in order to respond but the amount of information provided to the payer may vary depending on the claim. If unsure how much detail can be provided to the payer, check with a Service Support Officer before contact is made. At all times, discuss with the payee the information that will be shared between the parties, particularly if there are family and domestic concerns.

Play the Automated message - Application for child support to be collected to the customer using Services Australia Workspace. Once the customer confirms their responsibilities, select the check box in the Application for collection macro.

Explain the payment cycle and check payee's bank account details on the Bank details window in Cuba.

Document and record any change to the payee's bank account details, including:

• name of the bank
• BSB number
• account number
• name of the account holder

The bank account name recorded on Cuba must include the payee's name. If the name on the disbursement does not match the account name, some financial institutions may reject the payment.

Discuss the payer's payment options and the impact on disbursements

The first payment to the agency by the payer will generally be due by the 7th of the month following the first statement that issues to the payer. This could mean the first disbursement may not be made up to one and a half months after lodging an AFC. For further information on payment periods and due dates for payment by payers, see the References page for a link to the Child Support Guide 5.1.5: Payment periods and payment of child support debts.

Example: an AFC was lodged on 27 September. The payer will receive their first statement approximately 20 October which includes liability raised from 27 - 30 September and the full month of October which is due and payable by 7 November.

Explain apportionment where multiple cases exist

If the payer owes child support to more than one payee and makes a payment for less than the total of the liabilities to each payee, the payment will be apportioned in proportion to the amount each payee is owed.

Note: since 1 January 2007, payees have been able to privately enforce child support debts that are also collectible by Child Support. If a court orders payments under these provisions, the normal apportionment rules may not apply. See the References page for a link to the Child Support Guide 5.4.7: Payee's right to enforce debt via court proceedings or seek Service Support Officer support.

Explain the method Centrelink uses to calculate FTB entitlement for collect customers

Family Tax Benefit (FTB) entitlements are calculated in 2 ways:

• Entitlement method
• Disbursement method

Only payees with the collect option have the choice of these methods.

Entitlement method

This is the default method for all private and child support collect customers. Under this method, FTB Part A is worked out using the amount of child support a person is entitled to receive under a child support assessment. However, the amount of child support a customer actually receives is also taken into account. If a customer:

• does not receive the full amount of child support they are entitled to over a financial year, they may get a top-up payment
• is disbursed an amount that is more than their entitlement for that period. For example, due to the payment of arrears, their payment rate may be reduced to help avoid an overpayment at the end of the financial year

Disbursement method

FTB Part A is calculated using the amount of child support actually received by the customer. This option is only available for collect customers and must be requested by the customer. This method may be appropriate for customers who receive substantially less child support than they are entitled to, or who receive irregular disbursements.

If an AFC is accepted, the customer will be assessed for FTB purposes on the Entitlement method. The payee has to contact Centrelink to discuss the payment method they prefer. Offer to transfer the parent using Services Australia Workspace.

Offer the payee relevant products or services, see Social Worker and other service referrals for child support customers that will assist them such as:

• Factsheets
• child support publications
• CSAOnline
• Family Relationship Advice Line or other external referral services
• Community Services Directory

Parents can access publications online at servicesaustralia.gov.au or they can be issued to them. See Products and Services Window Help.

Advise the payee that the payer will be contacted about the AFC. If there is a dispute about the opt in arrears amount, Child Support will be in further contact with them.

During or after these discussions the payee may decide not to proceed with the AFC. If so, see Table 3.

Obtain payer details which may assist collection activities

Obtain any known payer details including:

• address
• phone
• employment/industry
• bank account
• aliases
• company name details
• overseas travel
• any known gambling activities

Note: the Child Support Registrar is only authorised to collect TFNs in writing. Do not ask for the payer's TFN over the telephone.

Discuss collection methods

If the payee does not believe the payer will pay, manage their expectations by advising them of the action that can be taken along with possible timeframes. Make sure the payee understands that they will not automatically receive child support just because they have elected for child support collection.

Advise the payee:

• of enforcement measures that can be taken if payments are not made voluntarily for example salary deductions by the employer, tax refund intercepts, garnishee of bank accounts
• that Child Support will try all avenues of collection and to contact the agency immediately if they have any information about the payer that may assist with collection

Provide a realistic view of agency capacity to collect child support where payer's attempts to avoid collection.

At any time before the AFC is processed, the applicant may change their mind and continue to collect privately. If this is the first AFC then a later AFC will also be a 'first' AFC for the purposes of this document. That is because collection never started.

After the application is processed, the applicant can opt out of collection if they elect to return to private collect.

Note: if the customer has family and domestic violence concerns, warm transfer the customer to the Parent Support Team.

An AFC can be 'withdrawn' verbally or in writing.

Make sure the payee understands that if the circumstances change and they later decide they want Child Support to collect, they will need to reapply. The collection start date will only take effect from the date of the new AFC, not the previous application.

If the payee decides to remain in a private collect arrangement, clearly document the discussion.

This information will be important if they decide to apply for collection at a later date.

If the parent is in receipt of Family Tax Benefit (FTB), make sure they are aware of the possible impacts on their FTB Part A entitlement:

• they are deemed to have been paid the full amount of child support they are entitled to receive, regardless of the amount they actually get
• if the child support assessment is updated retrospectively and there is an increase to the assessment there are limited options for them to:
• request collection of child support arrears
• review FTB Part A overpayments
• adjust FTB Part A payments to take into account any child support that cannot be privately collected

Advise the parent to contact Centrelink if they have specific questions about their FTB Part A entitlement.

Note: if contact with the payer is made before the payee withdrawing the AFC, contact the payer to advise of the withdrawal and that payments must continue to be made directly to the payee.

See Step 1 in Table 7.

If the payee decides to continue with child support collect, proceed with the AFC.

A preliminary calculation of any unpaid child support based on information provided by the payee must be made before contacting the payer.

Using the information provided by the payee at Step 4 in Table 2, make a preliminary calculation of:

• any unpaid child support amounts claimed
• a future opt in date

Payments made during or specifically for the 3 month arrears period that would otherwise qualify as prescribed NAPs must also be included in the arrears calculations. This may mean that although the cash payments have been less than the full liability each month, the liability has been paid in full after the 30% prescribed NAP crediting rate has been accounted for. If this occurs consider refusing the application because the payer has a satisfactory payment record.

Explain the calculation of unpaid amounts to the payer during the pre-collection interview including:

• amount of each payment made
• date of each payment
• period the payee states the payment covers and either
• the date the payee is claiming arrears from, or
• a future opt in date

When advising the payer of the total arrears, include the:

• current liability rate
• total liability due in the arrears claimed for period
• total amount paid

If the payer has paid their child support liability in advance, the opt in should not be accepted from the date the application was received, but a future date should be calculated to take into account amounts already paid. Note: this date cannot be more than 60 days after the AFC is received. See the FAQ on the Resources page.

Example

M lodged a first time AFC on 15 February 2020. M advised that the liable parent, F, made a lump sum payment on 1 January 2020 that was to cover the full amount of the liability until 1 April 2020. The future opt in date will be 2 April 2020.

The Case Collection Details window will:

• auto-calculate the Opt In arrears amount when the relevant details are entered
• display the calculated arrears amount once the period is specified

See the Application for collection Cuba Process Help.

Note: at this stage do not tick any of the checkboxes in the Granted field.

Is the payer incarcerated?

• Yes. Contact with an incarcerated payer must be made by the Incarcerated Customer Team. Follow the process in Customer referral guidelines for Child Support staff
• No. Contact with the payer must be made before making a decision to accept an AFC (pre-collection interview). Use the Application for Collection macro for taking and documenting an AFC call with the payer

Aim of the pre-collection interview

The aim of the pre-collection interview is to discuss:

• the circumstances behind the collection request
• the best arrangement for the customer's circumstances
• Employer Withholdings (EW) to be established (if applicable)
• Payer may make an election for EW not to apply if criteria is met
• current assessment and payer details
• amounts of any unpaid child support
• due dates, payment periods/methods, options, rights and responsibilities

Note: if the payer indicates Family and Domestic Violence concerns any time during the conversation, offer support referrals and continue with the AFC.

If contact attempts have been unsuccessful, send a MOI7-1 Payer contact before AFC Opt In is accepted letter, see Letters Cuba Process Help. Continue to make telephone contact attempts on all available numbers.

After making all reasonable contact attempts, the decision is made to accept the application for collection, and contact has been unsuccessful with the paying parent (including at their place of employment and via mail) when registering a new case or an AFC, EW must be established without waiting for the customer to pay voluntarily.

Advise the payer:

• why the payee has requested collection. This will depend on the circumstances outlined by the payee
• if relevant, a 'first time AFC' must be accepted

The conversation will assist in determining whether a 'subsequent AFC' will be accepted.

Reconciliation

If the payer indicates that there has been a reconciliation, advise that their FTB may be affected. See Step 1 in Table 2.

Note: if the payer receives a Centrelink payment, and has reconciled in the opt in period, advise them to contact Centrelink about their change in circumstances.

Exceptional circumstances

If more than 3 months arrears have been requested, seek the payer's response to the exceptional circumstances outlined by the payee.

If the previous discussion with the payee indicated that they were unsure about changing to collect, explore suitable options for private payments. For example, is the payer agreeable to transfer payments from their bank account to the payee's bank account or could they arrange for salary deductions to be transferred into the payee’s bank account?

Note: bank transfers may attract a fee whereas salary deductions would not. Can an agreement be negotiated for periodic and non-periodic amounts?

Advise the payer of the current assessment and confirm the following:

• Are the current and/or previous incomes accurate?
• Have tax returns been lodged or will be lodged?
• Can the payer lodge an ITD to replace any default incomes?
• Can an estimate be lodged?
• Is there something unusual about the case that might justify applying for a Change of Assessment in special circumstances?
• Are all relevant dependent children reflected on the assessment?
• Is the correct level of care reflected on the assessment details?
• If the income being used in the assessment during the 3 to 9 month opt in arrears period is subject to future changes, for example, an unreconciled estimate or default income, this may later have an impact on the opt in arrears?
• Is there a court order or child support agreement that impacts the rate of child support payable? If yes and it is not recorded in Cuba ask the payer to provide a copy within 7 days

Check the accuracy of the information provided on the AFC and the preliminary calculations. Establish or clarify the payer's payment record by asking:

• amounts paid in recent months
• what dates they were paid
• how they were paid
• to whom they were paid
• in kind payments
• what period was each payment made for (parent may consider the payments to be in advance or in arrears)
• if the other party and the applicant had reconciled during the private collect period
• if the payments were intended for child support

Using the above information determine if the payments:

• have been more or less than the liability, and/or
• have not, or have been paid by the date the parents agreed to

Request evidence of any payments made especially if there is a dispute about the arrears.

What are the circumstances behind payments being late or not paid at all?

Ask for reasons that adequately explain late or part payments. Child Support are not obliged to accept subsequent AFCs if the payer has satisfactorily explained their failure to meet their obligation and rectified that failure. For examples, see the References page for a link to the Child Support Guide 5.6.3: Reapplying for collection.

Were any 'in kind' or 'third party' payments made in the private collect period?

Any private payments for child support must be considered when determining amounts of unpaid child support. This not only consists of the direct payments from the payer to the payee but also any 'in kind' or 'third party' payments. Since these types of payments are not NAPs, the normal NAP requirement that customers intended the payment to be treated as child support do not apply. Payments that meet all the requirements of a 'prescribed' payment (under s71C) are also included. See the References page for link to the Child Support Guide 5.1.4: Collection of arrears accrued during non-collect period.

For example, if the payer states a payment listed as a specified payment was paid and it meets all the requirements of s71C, allow the payer credit of up to 30% of the liability providing the remaining 70% of the liability was paid to the payee.

When Child Support is notified of a child support payment paid by the payer to the payee (or a third party) after the AFC is lodged, the payment, if accepted by Child Support, is taken into account by either:

• adjusting the opt in date to a future opt in date, or
• considering the payment as a NAP

The way in which the payment is recognised depends on the payment date and the date the liability becomes enforceable, that is, opt in date.

It is common for payers to continue to make private payments during a transition period of private collect to collect. A payee may state they never agreed this payment would be for child support. Ascertain if these payments were made in a similar way to previous payments made during, or specifically for, the private collect period. If this is the case, it can be presumed that both customers agreed that the payment was intended as child support unless the payee provides a credible reason to indicate otherwise.

Adjusting the opt in date to a future opt in date

If the payment was made after the AFC was lodged and covered a specific period after the AFC lodgement date, adjust the opt in date to start the day after the payment period, see Application for collection Cuba Process Help.

Note: the opt in date cannot be more than 60 days from the AFC lodgement date. See the References page for link to the Child Support Guide 5.1.3: Date a liability first becomes enforceable - Existing child support assessments section.

Example

The AFC was lodged on 3 February and the arrears claimed are from 16 January. A payment was made 9 February for the period the 16 January to 15 February. A future opt in date will commence 16 February and the liability will be enforceable from this date.

In this example, if it was a subsequent AFC, a decision may also be needed whether or not to accept the application.

Considering the payment as a NAP

The following payment is considered a NAP where the payment/s is made after the AFC lodgement date and:

• the amount paid is less than the claimed for arrears, or
• the amount paid is more than the claimed for arrears but:
• the customers cannot agree on a specific period of time, and
• a future opt in date cannot be determined

If accepted, these payments are processed in Cuba after the AFC has been accepted. See Non-agency payment (NAP) Cuba Process Help. The AFC opt in date will be the application date.

Excess cash

Where there is excess cash on the account, advise the payer that it will reduce the amount they have to pay for the first and possible future payments. The parent can ask for a refund if they prefer not to have a cash credit on their account.

Overpayment

Where an overpayment exists, advise the payer how it will affect the first and possible future payments. The payer has the option to:

• waive the overpayment. Waiving an overpayment will not result in any funds changing hands, but merely reduces the overpayment
• pay a reduced amount until the overpayment is absorbed
• make no payments until the overpayment is absorbed
• if exceptional circumstances exist they may request that an overpayment be refunded

Excess NAP credits

Where there are excess NAP credits on the account from a previous collect period, check that these amounts should have remained on the account. See the References page for a link to the Child Support Guide 5.3.1: Non-agency payments. If the credits should remain, advise the payer how it will affect the first and possible future payments.

Make sure the payer understands how payments and disbursements are managed. Highlight the importance of advising if they have difficulties making the payments in full and/or on time.

Due dates for payments

Cuba defaults to payments due by the 7th of each month for liability raised for the preceding month.

The first payment will be due by the 7th of the month following the first statement the payer receives. Thereafter it will depend on the payer's preferred payment period.

Example

An AFC is lodged on 27 September. The first statement will issue approximately 20 October which includes any opt in arrears, liability raised from 27 - 30 September and the full liability for October which is due and payable by 7 November. For further information on payment periods and due dates for payment by payers, see the References page for a link to the Child Support Guide 5.1.5: Payment periods and payment of child support debts.

The payer may prefer to make manual payments with a different due date or a different frequency. Discuss payment options for customers.

Establish collection method

During the discussion with the payer, it may be decided the AFC will be accepted based on the facts. If this occurs, review and discuss the following payment methods with the payer during the call:

• Other existing collectable case
• When considering payment methods, if the payer has another collectable case check how those payments are being made and if there is outstanding debt. Review the case/s to check if the same payment arrangement and method will continue
• If Employer Withholding (EW) has not been established check if a Stop Withholding indicator is active. If there is no Stop Withholding indicator, establish EW or take an election for EW not to apply
• When speaking with a customer about payment options, start the discussion by enquiring about their employment situation. If they are a salary and wage earner, advise that Child Support will collect Child Support payments via their employer
• Collection of ongoing liability / debt
• Discuss if the opt in arrears, any other arrears and monthly child support are likely to be paid by the due date. If the arrears will not be paid in full, review or negotiate a new debt repayment arrangement
• If the payers election to pay manually is accepted, go to the Customer payment reference number calculator macro to provide the payer their reference numbers and other details applicable to their preferred payment method so payments can be made before they are issued their first statement

Explain apportionment where multiple cases exist

If the payer owes child support to more than one payee and makes a payment for less than the total of the liabilities to each payee, the payment will be apportioned in proportion to the amount each payee is owed.

Note: since 1 January 2007, payees have been able to privately enforce child support debts that are also collectible by us. If a court orders payments under these provisions, the normal apportionment rules may not apply. See the References page for link to the Child Support Guide 5.4.7: Payee's right to enforce debt via court proceedings.

Offer the payer relevant products and services that will assist them, see Social Worker and other service referrals for child support customers including:

• Factsheets
• Child Support publications
• CSAOnline
• Family Relationship Advice Line

Publications can be accessed online at servicesaustralia.gov.au. See Products and Services Window Help.

Using the information gathered make a decision on the AFC. This will depend on whether it is a first or subsequent application and/or whether the application meets the requirements of s39.

Child Support must accept a first time AFC made by a customer who was until recently the payee, including in circumstances where;

• roles have reversed
• there has been a terminating event with arrears outstanding, or
• an election to end the case with arrears outstanding

Role reversal example: Payee Adriana applies for a child support assessment and elects for private collection. Later her role reverses and Adriana becomes the payer. Adriana can request collection of unpaid amounts on the initial case where she was the payee. Adriana can opt in requesting 3 months arrears (or up to a maximum of 9 months in exceptional circumstances) before the date that case first becomes collectable. This is regardless of the ongoing liability in the case where Adriana is now the payer.

If the customer has requested arrears, go to Step 2.

If the customer has not requested arrears, see Step 3 in Table 7

If the AFC is to be refused, see Step 2 in Table 7.

Request both customers supply evidence regarding payments made and/or received if they do not agree either with:

• the amount of the arrears, or
• the period that they apply to

Otherwise, see Step 3 in Table 7.

The type of information that needs to be obtained includes:

• the specified period for which arrears are to be collected
• the dates payments were made
• amounts paid
• who payments were made to (payee or third party)
• how it was paid (cash, cheque, bank deposit)
• when it was paid
• what period the payment was intended to cover
• the intention of the payment that is, whether both parties agree about the payment or regular payments to the third party
• if the parties reconciled

Customers should be encouraged to provide any evidence they have to support their claims. This evidence could be in the form of copies of receipts, statements, paid bills, statements from third parties who witnessed the payment etc.

Note: the agency does not accept evidence from children.

Provide the customers with an appropriate time frame of 14 days which is usually sufficient to provide evidence. Allow for any reasonable circumstances which may delay provision of this information. Some remote locations for example may not have regular mail services and even a 14 day timeframe may not be sufficient for the customer to first obtain and then forward necessary evidence.

Even though the AFC might only apply to a 3 month opt in arrears period, valuable evidence could exist from an earlier date. For example, if payments have been made late every month in the 3 month arrears period which triggered the AFC, the past 12 months payment records might indicate a genuine misunderstanding on the payer's part about when the payments were due.

If a payment was made within the 3 or 9 months opt in arrears period, it is not a NAP but a payment which needs to be taken into account when calculating the amount of the opt-in arrears. This includes 'in kind', 'third party' and 'prescribed payments'.

Once the supporting information is gathered, decide:

• what period the arrears are for, for example, up to 3 or 9 months, and
• what payments should be treated as child support for the period

Note: if the parents do not agree and the Registrar cannot be satisfied that payment was made for some or all of the arrears period being claimed, the arrears claim will be accepted. An exception may be where the payee has delayed the application for arrears to the extent that records about amounts paid are no longer available. In these cases, the Registrar may not be satisfied that amounts were unpaid and the arrears claim may not be successful.

If, while gathering evidence, false or conflicting information is provided or either party has provided false or misleading information, see Report Suspected Fraud and Corruption.

The arrears auto-calculate once all the information has been keyed into Cuba. The date from which the arrears apply cannot be:

• more than 9 months before the Opt In date
• before the date on which the case was last opted out, or
• before the start date of liability

The following illustrates how the arrears are calculated.

Arrears Amount = total liability for specified period less payments made.

(a) For whole months at a particular rate, the liability is:

(daily rate x 30.4375) x number of months

(b) For the days in a part month the liability is:

(daily rate x number of days)

Note: the arrears period does not include the opt in date.

The final calculation of the opt-in arrears should be recorded as a new note as part of the original record in the Case Collection Details window.

Advise both customers how the amount of arrears was arrived at and the reasons for accepting or refusing any disputed payments. This is also a good opportunity to remind both customers if any unallocated NAP payments, excess NAP, excess discharge, cash overpayments and/or cash credits are on the account and how this will affect their payments/disbursements.

If there are no unpaid amounts for the private collect period when the payee applies for collection, the application for collection of arrears must be refused. However, if there is a retrospective variation to the liability after the acceptance of the AFC, this may mean amounts are now unpaid for the private collect period. If so, the payee may re-apply for collection of the unpaid amounts for the period 3 months (or up to 9 months in exceptional circumstances) before the case becoming collect, subject to the requirements of s28A or 39A.

Generally, customers can withdraw any type of application at any time up to the point it is processed in Cuba.

If the applicant decides to withdraw their AFC before a decision is made and processed in Cuba, see Application for collection Cuba Process Help.

Update the originating AFC record in the Case Collection Details window. Add a notepad with the subject line Withdrawal of AFC. Clearly document the conversation explaining why the payee decided to withdraw the application:

• this information is important if the payee decides to opt in at a later date
• open the Opt In record and update the status to Withdrawn and save. No letter will issue as a result of the payee withdrawing their AFC

Note: this is the end of the document if the AFC has been withdrawn.

A 'first time' AFC must be accepted, however a subsequent AFC can be refused.

If the decision is to refuse a subsequent AFC, contact the payee and explain the reasons why their application was refused and advise them that they may reapply later if circumstances change. If contact has been made with the payer, contact them to explain why the AFC has been refused. Make sure both customers understand the case will remain private collect and payments are to continue to be made directly from the payer to the payee.

Document the refusal in the Case Collection Details window and process in Cuba, see Application for collection Cuba Process Help.

Cuba will auto-generate a refusal letter for both customers (MOI4-1 Rejection of an application for Opt In), see Letters Cuba Process Help.

If contact was made with the payer regarding the AFC, then the letter should be released. If contact was not made with the payer, delete the letter.

Note: this is the end of the document if the subsequent AFC has been refused.

If the decision is to accept the AFC, the opt in date will either be:

• the date AFC was lodged with or without arrears, or
• a future date

Once arrears, if any, have been calculated or if a future opt in date has been determined, update Cuba to reflect the change, see Application for collection Cuba Process Help, Steps for adjusting an AFC.

Note: advise the payee to notify Centrelink as there may be an impact on their FTB entitlement for the private collect period. The payee will need to provide Centrelink with the date that the arrears period covers and any amounts of child support privately paid for the arrears period.

When processed, customers will be advised by letter of a change to the collection status of the case, see Application for collection Cuba Process Help, Steps for processing an AFC. The following letters are auto-generated by Cuba:

• MOI3-1 To Payee - Child support will now be collected by Child Support
• MOI3-2 To Payer - Child support will now be collected by Child Support

If after processing the AFC, payments for the period before the case was made collect are discovered, explain to, the customer:

• their right to object to the calculation of the Opt In arrears amount
• if appropriate, their right to apply for an extension of time to object.

If an adjustment to the amount of the opt-in arrears amount is determined and saved, then the following letters will issue to the customers:

• MOI6-1 To Payee - Adjustment to arrears allowed at Opt In
• MOI6-2 To Payer - Adjustment to arrears allowed at Opt In

Once the AFC is accepted either:

• process the payment arrangement as discussed in Step 6 in Table 5, or
• contact the payer to make sure there is a payment method and debt repayment arrangement in place that will meet the ongoing liability and any arrears

Before unlocking the customers, make sure:

• EW / EWA if applicable is established
• EW not to apply application (if required) is processed
• A voluntary payment arrangement is processed, or
• A Section 72a notice for ongoing payments is in place and the first payment has been received

If the payer refuses to enter into a payment arrangement or has not responded to contact requests, enforcement action is required. See Debt repayment.