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Employer Withholding (EW) - Election for EW not to apply (CS) 277-04150000

This document outlines information about employer withholding and an election for EW not to apply.

On this page:

Election lodged

Accept or refuse an Election for EW not to apply

Process the decision and notify customers

Revoke an election

Election lodged

Table 1

Step	Action
1	Election received An election not to have child support payments deducted directly from salary and wages can be made: verbally or in writing (form or letter) and when the customer is a payer with an ongoing periodic liability Note: a customer with a carer only debt cannot make an application. The election should include: the payer's employer details including: the employer's name address contact phone number payer's employment status (employee or contractor) The Resources page contains a link to the Application to stop child support deductions from salary or wages form (CS1652).
2	Determine if the election can be made A payer cannot make an election if a previous election has been: refused in the last 2 months, or revoked in the last 6 months because the person did not pay on time This period starts from the date the Registrar revoked the election. Can the election be made? Yes, see Table 2 No, procedure ends here. EW must be established. See Employer Withholding (linking) for Child Support customers

Compliance history for an Election for EW not to apply

Table 2

Step	Action
1	Providing employment information If a payer does not wish to provide their employer information, advise them that their election for EW not to apply will have a greater chance of being approved if their employer information is provided. If the payer wishes for their election to be considered while continuing to refuse to provide employer information, consider the reasons why the payer has refused to provide the information, and any other relevant information relating to the election. A decision to accept the election for EW not to apply can still be made, even if the payer has not provided their employer information. However, the Registrar must be satisfied, having considered the payer’s circumstances, that they are likely to make timely payments. Go to Step 2.
2	Review compliance history The Registrar will only accept a payer's election for EW not to apply if satisfied all future payments will be made on time. A payer's payment history is a critical factor in deciding if the election is to be accepted. For payers who: are paying child support for the first time, go to Step 3 do not have a debt, go to Step 4 have a debt, go to Step 5 are making a subsequent election when the previous election was revoked or rejected, go to Step 6
3	Paying child support for the first time This includes payers who: are payers of child support for the first time are not yet due to make the first payment, and have not previously made an election Determine whether the payer is likely to make payments on time by considering whether they: have not expressly indicated an intention to avoid paying had sufficient notice to make the first payment, and if not, has committed to paying as soon as possible have made a suitable payment arrangement to pay any ‘start-up’ debt Note: where a discussion of payment could not be made with a prospective payer, the Registrar will collect the payments by employer withholding. See Employer Withholding (linking) for Child Support customers.
4	Payers who do not have a debt This includes payers who: have not previously made an election were due to start making payments by a date which has already passed, either for current or previous liability, and do not have a debt Determine whether the payer is likely to make timely payments by considering whether: they have not expressly indicated an intention to avoid paying, and they have established a pattern of making payments on time, or the account is up to date and not as a result of recent enforcement action See Table 3
5	Payers with a debt This includes payers who: have not previously made an election were due to start making payments by a date which has already passed, either for current or previous liability, and have a debt The Registrar will not be satisfied a payer who has a debt is likely to make timely payments unless: they were unaware of their child support liability the debt is the result of start-up arrears, a Section 106A order, or retrospective variation, or they have the debt under arrangement and have been meeting the arrangement on time for 3 months or more See Table 3
6	Subsequent Elections Subsequent elections can be made when: the payer had a previous election revoked because payments were not made on time where the Registrar rejected the previous election The Registrar will consider a subsequent election if the payer can demonstrate the circumstances that led to the previous election being revoked no longer exist. Payments must be up to date, and more substantial indicators of timely payments than what was needed in allowing the previous election. These may include: the payer offers to be permanently in advance by at least one month's payment the monthly liability has reduced since the previous election, and a genuine effort to pay has been demonstrated to satisfy the Registrar that monthly payments will be made in full and on time An example of a genuine effort to pay The payer was paying regularly but lower than the ongoing liability rate. The payer was seeking a re-assessment (for example objection, ART, COA). The re-assessment subsequently reduced the ongoing liability rate to an amount closer to the amount paid by the payer. See Table 3

Process the decision and notify customers

Table 3

Step	Action
1	Process the decision Start point: Payer Employer Relationship window Select the Withholding Arrangements button to open the Withholding Arrangements dialogue box Accept election Select Stop Withholding Enter the start date for the decision and an end date that is less than 365 days after the start date Select the appropriate Reason from the drop-down list The system generates: PAD12-1 Advice of acceptance of exemption from EW letter if the employment status is unconfirmed PAD16-1 Advice that new payment option accepted letter in all other circumstances A Stop Withholding End Date Reach intray will be created on the payer’s record with a due date 21 days prior to the end of the stop withholding arrangement. Do not delete this intray. When the Stop Withholding End Date Reach intray is allocated, contact the payer to discuss either: establishing employer withholding, or a new election for EW not to apply Refuse election Select Disallow Election Enter date of the decision Select the appropriate Reason from the drop down box. The system generates a PAD11-1 To Payer - rejected exemption from automatic deduction letter
2	Document the decision Complete the: Election for EW not to apply macro to document the decision, or Collection and Debt - Enforcement action macro when revoking an election, see Table 4 Document the decision in the Collection window> Information Gathering > Phone > Other > Depending on the decision, key in capital letters: EW ELECTION NOT TO APPLY ACCEPTED EW ELECTION NOT TO APPLY REFUSED PAYER CANNOT MAKE AN ELECTION FOR EW NOT TO APPLY
3	Notify customers Customers are entitled to a full explanation of decisions that affect them. Properly informed customers reduce reverse workflow. Automatic letters are issued in the following cases: Employer contact, for details go to Step 6 Payee contact, for details go to Step 7 International payee, for details go to Step 8 For details of contact to be made with a customer in the event an election was: refused, go to Step 4 accepted, go to Step 5
4	Election refused If the election is refused, contact the payer to advise their election has been refused. See Contact with Child Support customers. Advise the payer: Child Support cannot accept the election as the agency is not satisfied that payments will be made voluntarily in full and on time deductions from their pay are the most efficient method to ensure timely payments they will receive a letter advising when deductions will be made from their pay manual payments must be made until Employer Withholding deductions commence. See Customer payment reference number calculator If prior to the election for EW not to apply being refused: EW was established, procedure ends here EW was not established, see Employer Withholding (linking) for Child Support customers
5	Election accepted If the election is accepted, contact the payer to explain the election has been accepted. See Contact with Child Support customers. Play the Automated Message – Election Accepted to Pay Voluntarily to the customer using Services Australia Workspace See the Resources for the Automated Message. Confirm with the payer: Their responsibilities about making payments provided in the automated message The EW not to apply election is valid for 12 months The payer will need to re-apply either verbally or in writing to request the Agency not to deduct through their wages If a new application is not received, employer withholdings may be established
6	Automatic letter - Employer contact Where employer withholding has been established, a PAD 7-1 To notify to cease deductions letter and PAD 6-2 Schedule of Child Support Deductions letter will issue to the employer advising them to cease deductions. Procedure ends here. Note: if deductions need to cease urgently, contact Employer Services via Services Australia Workspace by selecting Employer. Procedure ends here.
7	Automatic letter - Payee contact A PAD12-2 Accepted Exemption From Automatic Deduction letter will automatically issue to any payee owed a debt, including payees in private collect arrangements. Delete the letter if it is being issued to: a payee in a private collect arrangement or a customer who has the overall role of payer if parents have dual roles due to shared care Procedure ends here.
8	Automatic letter -International payee Cuba will issue a PAD 12-2 Accepted Exemption From Automatic Deduction letter to the Central Authority. For New Zealand ‘in’ cases no Cuba letter will issue. A unique letter is not required.

Revoke an election

Table 4

Step	Action
1	Payer does not make timely payments If a payer does not make timely payments, the election will be revoked unless the Registrar is satisfied the payer: is likely to resume making timely payments, and enters into a reasonable payment arrangement in accordance with the Debt repayment methodology for the unpaid child support amount
2	Is the payer likely to resume making timely payments? In considering whether the payer is likely to resume making timely payments, the Registrar will first determine whether one of the following special circumstances caused the payer not to pay on time: the circumstances causing the failure to make timely payments were beyond the payer's control, and the circumstances existed for the 1 month only, or if the circumstances will continue beyond the 1 month, the payer has taken reasonable action to minimise their effect in the future the payer advised an unexpected temporary drop in income, or an urgent and necessary expense caused the late payment, but for the 1 month only the amount payable for a particular month is abnormally high because it includes additional amounts for previous months caused by a retrospective variation to the liability, and the payer cannot afford to pay the additional amount by the due date Do special circumstances apply? Yes, go to Step 3 No, go to Step 4
3	Special circumstances apply If special circumstances apply, to satisfy the Registrar that timely payments are likely to resume the payer must: make a reasonable proposal for paying off the debt which has been accepted undertake to pay the normal monthly amount (that is, the monthly amount after excluding debt) when each fall due, and have established a payment pattern which indicates that, under normal circumstances, they make timely payments Is the Registrar satisfied there person is likely to resume making timely payments? Yes, and a payment arrangement has been accepted: Document the decision to not revoke the election for EW not to apply. Notify the payer their election will continue, explaining the reason(s) for this. See Contact with Child Support customers Procedure ends here No, go to Step 4.
4	Revoke Election for EW not to apply The election will be revoked if the Registrar is not satisfied the payer is likely to resume making timely payments in the near future. Start point: Payer Employer Relationship window Select the Withholding Arrangements button to open the Withholding Arrangements dialogue box Update the Date to End field with the date the election is to end Select OK to return to the Payer Employer Relationship window Save and check the letters for correctness Document the decision to revoke in the Collection window. See Table 3 > Step 2 Note: a new EW linking request or a request for EW to recommence will be unable to be actioned until the Date to End date has passed. If prior to the election for EW not to apply being accepted: EW was established, remove the Stop Withholding indicator and re-establish EW, go to Step 5 EW was not established, see Service Officer role in setting up Employer Withholding (EW) linking
5	Recommence EW after ending Stop Withholding Start point: Payer Employer Relationship window. Were employer details recorded at the time Stop Withholding was established? Yes, create an Org Follow Up intray on the employer to be linked and document the details of the customer No, establish a new link, see Employer withholding (linking) Cuba Process Help Org Follow Up received (ESO only) When employment has been confirmed, to re-link to a previously recorded employer, in the Employee Information group box, select: the arrow adjacent to Pay Cycle to open the Employer Pay Cycles dialogue box the pay cycle that the customer should be on OK to return to the Payer Employer Relationship window the next appropriate pay date in the First Pay Date dropdown menu. Note: a 10 day buffer is required save and add a note