Suspending disbursements of child support 277-05080000

A person who believes they are not the parent of a child can challenge an assessment for the child through the courts (an s107 application). References has a link to the Child Support Guide 4.3.2: Applications and orders about decisions under the Assessment Act).

The applicant is required to provide a copy of the s107 application to Child Support.

An application for suspension of disbursements is not required if a s107 application is received. Suspend disbursements for the child/ren subject to the dispute.

Go to Step 3

Where a person lodges a dispute (objection, ART application or court application) in relation to the validity of the assessment that relies on grounds other than disputed parentage. Examples of ‘other grounds’ are the:

• child is not an eligible child
• applicant was not entitled to make an application for the child, or
• payer was not an Australian resident

The payer must be informed of their right to apply for the payee’s disbursements to be suspended. The payer can then request suspension of disbursement of monies to the payee.

Note: applications can be made in writing or verbally. It is not necessary for the payer to attach financial information to the application.

Go to Step 3

Suspensions of disbursements are made on the basis of a dispute over the eligibility of a child or the validity of an assessment overall.

If the dispute is about only 1 of 2 or more children, for example, the payer challenges the cohabitation dates which established presumption of parentage for 1 child, but not the others, only suspend the portion of the disbursement relating to the child subject to the dispute. For this reason, it is necessary to place a partial suspension on the payee’s disbursements in some circumstances.

If a partial suspension is required, see Resources for examples about how to calculate the amount to suspend. If unsure, seek assistance from a Service Support Officer (SSO). See Technical support in Child Support.

Contact both customers to ensure they understand the effect of suspending disbursements.

See the discussion points relevant to the circumstances of the case. For:

• s79A suspensions (s107 applications), go to Step 2
• s79B suspension applications, go to Step 3

Disbursements to the payee must be suspended when a s107 parentage application has been lodged with the court.

Contact both customers and explain:

• payments must continue to be made to Child Support
• payments cannot legally be disbursed to the payee until the s107 application is finalised
• if the court refuses to make a s107 declaration, any money held will be released to the payee, and if the court makes a s107 declaration, the money held will be applied to other payer debts to the Commonwealth, or refunded to the payer

Clearly document the discussion and any attempts made to contact the customers in the communication screen of each person. See Documenting Child Support information in Cuba.

See Table 4.

If an application is made by the payer, explain:

• that payments must continue to be made
• if the application for suspension is accepted, payments will not be disbursed until the dispute process has been finalised
• if the dispute is disallowed, all money held will be released to the payee, and if the dispute is allowed any money held will be applied to other payer debts to the Commonwealth, or refunded to the payer

Clearly document the discussions in the Communication window.

Contact the payee and advise of application to suspend. Explain all of the above and ensure financial hardship is discussed (See Step 5).

If Service Officer cannot contact the payee by telephone, document all attempts and send a unique letter MX-01 containing suggested letter text as per Application received to suspend payments - Respondent letter (letter to payee - please contact). Ensure all the correct details are completed before sending through Cuba Unique Letters. See Letters Cuba Process Help.

Allow the customer time to respond. See Standard response times.

If there is no response within the timeframe specified, see Table 3.

The payee may indicate they will be unable to manage financially without child support payments. The following steps provide guidance in these situations. Decisions about financial hardship must be made in accordance with the individual circumstances of the parents.

If the payee agrees with payments being suspended and does not mention concerns about financial hardship, see Table 3. Financial hardship means being unable to meet the cost of basic needs as they come up. Basic needs include:

• food
• clothing
• medicine
• accommodation
• education for children
• other basic requirements

For more information, see References for a link to the Child Support Guide: 5.2.8: Serious Financial Hardship.

To determine whether the payee will suffer financial hardship without child support payments, ask them to provide financial information relevant to basic needs over the telephone. It can be difficult for customers to provide details of their financial information straight away, so consider calling them back later at a mutually convenient time.

Note: documentary evidence is not required for a hardship claim approval. Request written evidence if there are concerns about the information provided. Evidence could include copies of overdue bills or invoices relating to any of the items listed at Step 5.

Discuss specifically with the payee:

• the effect on any other adults and/or children who are dependent on them
• the level of income that is otherwise available to the payee such as benefits, salary and wage income, and
• any possible Centrelink impacts if the payee is reliant on benefits - Service Officers may wish to conduct a conference call with Centrelink to discuss

Offer the customer a referral to an appropriate financial counsellor to assist with budgeting. See Community Groups.

Document contact with the customer in payee communications screen, including any referrals provided.

Recommendation for disbursements to be suspended can be prepared by a SO3 or 4 and must be submitted to a SO5 for approval and to give effect to the decision on Cuba.

Disbursements to the payee must be suspended when a s107 application has been lodged with the court.

See Table 4.

Suspension of disbursement for s79B dispute is a discretionary decision.

See References for a link to the Child Support Guide 5.5.4: Suspending payments to payees.

When making a recommendation, consider:

• any information the payee has provided about possible financial hardship
• any information provided by the payer, verbally or in writing about their application
• the length of time the payee could be without child support payments if the decision is to suspend disbursements. They will not be entitled to disbursements until the dispute has been finally resolved, and all the review periods have passed

If satisfied that suspending disbursements will not cause the payee and children financial hardship, recommend acceptance of the payer’s application.

If determined that the payee and children will be unable to manage financially, recommend the payer’s application be rejected.

Approval must be obtained even if the recommendation is that payments should not be suspended.

Approval must be obtained from a SO5 or above:

• clearly document the recommendation on the Case window
• create a General Follow up intray, copying the recommendation into the intray notepad and keep the intray locked to yourself, and
• create an online SSO request as per Technical support in Child Support for SSO approval

The SO5 will consider the recommendation and:

• suspend disbursements to the payee by placing a hold on the payments
• if it was a s79A application the SO5 must select the dropdown option of s107 or Stay whilst processing the hold, and either choose to hold for All Cases - 100% Hold or for a specific case. Selecting these options will ensure Cuba automatically sends the correct S79A-1 and S79A-2 letters to the parents.
• if it was a s79B application the SO5 should select the dropdown option of Objection, Court App or SSAT whilst processing the hold, and either choose to hold for All Cases – 100% Hold or for a specific case. Selecting these options will ensure Cuba automatically sends the correct S79B-1 and S79B-2 letters to the parents.
• contact the Service Officer to advise when the decision has been made and actioned
• offer feedback if they do not agree with the recommendation, and
• clearly document their actions

When SO5 has made the decision, the SO3 or SO4 will contact both customers and advise them of the decision. See Contact with Child Support customers.

If the decision is to:

• suspend disbursements, go to Step 4
• not suspend disbursements, go to Step 6

If the decision is to suspend the payments, ensure the customers are aware that:

• payments must still be made by the payer, but will not be disbursed to the payee until the dispute is finalised
• a determination will be made about disbursement (a 'resumption determination') if the dispute becomes finally refused
• any money held back will be refunded to the payer if they have been successful in their dispute

The appropriate letters will automatically issue.

If it was a s79A application:

• The paying parent will automatically receive the S79A-2 letter and the receiving parent will automatically receive the S79A-1 letter when the SO5 processes the hold with the reason of s107 or Stay and chooses to hold for All Cases – 100% Hold or for a specific case
• If the SO5 chooses to hold for All Cases – 100% Hold then all receiving parents will receive the S79A-1

If it was a s79B application:

• The paying parent will automatically receive the S79B-2 letter and the receiving parent will automatically receive the S79B-1 letter when the SO5 processes the hold with the reason of Objection, Court App or SSAT and chooses to hold for All Cases – 100% Hold or for a specific case
• If the SO5 chooses to hold for All Cases – 100% Hold then all receiving parents will receive the S79B-1

Where an application for suspension has been unsuccessful, advise both customers that the payer may seek a stay order through the courts if they are dissatisfied with the Child Support decision.

• Send paying parent the following automated letter. See Letters for Child support customers
• PAD 17-1 Letter to advise payer that application for suspension declined and collection of Child Support to continue

When the decision is made to suspend or not suspend, continue with the dispute resolution process.

See also:

• Child Support objections
• Administrative Review Tribunal (ART) applications against Child Support decisions, or
• Section 107 and Section 143 orders for Child Support customers

If the payer’s dispute (objection, ART application or court application) to the validity of the assessment was unsuccessful and all the appeal periods have passed, go to Step 2.

If the payer was successful in disputing the validity of the assessment and all the appeal periods have passed, go to Step 6

A resumption determination must be made when it is satisfied that the objection, ART or court application has been finally refused by Services Australia, the ART, or the court and any clear appeal timeframes have passed; Struck out, withdrawn or dismissed by the court and the standard 28 day appeal period has passed following the decision. Go to Step 3

A dispute becomes finally refused once the decision has been made, and any appeal periods have passed. If a customer is aggrieved by a decision made by the agency or the ART, they have 28 days from the date they received the decision details plus time to account for postage to request a review.

Any money held will be immediately disbursed to the payee. If the hold is removed prior to the eighth of the month, the funds will be available to the payee either on the eighth (or the following business day) or 2 business days after the hold is removed, whichever is the latter. See Disbursements of child support.

To resume disbursements to the payee, remove the hold on the payer’s payments. Document the reasons for lifting the suspension of disbursements. See Accounting Cuba Process Help.

This must be processed by an SO5 on Cuba.

Contact both customers and advise them of the resumption determination. Explain that:

• regular payments will resume as normal to the payee, and
• any money held will be paid to the payee

Document the contact with the customers and send letters:

UQ31.01 - Child Support payment resumed - Payee

UQ31.02 - Child Support payment resumed - Payer

Resources has a link.

Procedure ends here.

Where the payer has been successful in disputing either the paternity of the child/ren through the courts, or the validity of the child support assessment through the objections process or the ART, a refund to the payer must be processed when the appeal period has passed.

Example

Michael lodged an objection to Child Support's acceptance of Fiona’s application for child support for Belinda because Michael believed that Fiona was not an eligible carer of Belinda. Michael asked that Child Support suspend disbursements to Fiona and this application was accepted.

Michael’s objection was upheld, causing the child support assessment for Belinda to be made ineligible. Michael is entitled to receive a refund of the money held by Child Support once Fiona’s appeal timeframe has passed, that is 37 days after the notice of the objection decision was issued.

Fiona lodged a request for review with the ART during the 37 day timeframe. Michael is therefore not entitled to receive a refund until the ART decision is made, and any appeal timeframes to that have passed.

If the payer’s dispute is successful and the case has been made ineligible, any money that has been held must be refunded to the paying parent. See Refunds Cuba Process Help Retrieve a payment.

It is possible that Child Support may be holding money and the payer has arrears, even though he or she has successfully challenged the eligibility of 1 or more children. Contact the payer to advise that money held will first be applied against any debts to the Commonwealth and any remaining money will be refunded to the payer. See Contact with Child Support customers and Debt repayment.