ACT Calculation of Child Support after returning to work

[hassall]

Hello,

I appreciate this may be a common question. I am just about to get contacted by CSA after inputting what I believe my next tax return will be on MyGov CSA. I am estimating what I believe will be the amount after lodging a tax return at the end of the year, which is what is used normally.

I didn't work in July, my contract is for 4 months with extensions when I hope to go to 4 days per week for health reasons.

My income is based on 90k. My contract only started in August (so no income in July) and is for 4 months with possible extensions at which point I would like to go 4 days a week for health reasons.

I plugged in what I should be taxed and multiplied the post tax amount by 11. Which is about 63k.

I got burned badly many years ago when I was told by the CSA person that I had to report my GROSS fortnightly income, not what I thought my new post-tax return amount would be. Then the amount adjusted after the next financial year to what it should have been.

Why is it that CSA will use the after tax income from a tax return in "the system" but demand gross income and input that as the amount when calling? I don't get the tax I pay and the other party gets to use post tax return income which is always just below the self-support amount. I have my kids 50/50 but still pay a lot because the system is grossly unfair.

I always try to do the right thing, but this seems grossly unfair for an overinflated CSA amount that will come down once a tax return is processed...and I will struggle until that happens.

Grateful for advice on how I should approach this when I get called. My stance is, if I get the amount wrong or underestimate then I will owe (which I won't) but I will never see a penny back from over paying until "the system" kicks back in (which is what I predict will happen).

 

[sammy01]

CSA get it wrong more than they get it right. The poor buggers are overworked and under trained... Theoretically, the system is pretty good at equalising over-payments. So for example, I over paid for months while a dispute about care % was reviewed. The end result was i didn't have to pay for a while. But that resulted in the ex not having $$.... The system isn't perfect.

My advice, do your tax asap. They normally base it on the last year's tax return - If you use that you generally do ok.

 

[hassall]

Thank you. I was unemployed last year after some horrible events.

My taxable income was less than 20k

So 'the system' won't catch up until July next year after a financial cycle and even then I hope to be 4 days a week in a few months.

Which means my next tax return will be more than the income for a year after that.

 

[Tremaine]

Sorry, I’m a bit confused. What do you mean by ‘post tax return amount’? Because it sounds like you’re using your net income (ie income after tax is taken out), not your taxable income (income before tax is taken out, less deductions).

CSA has always assessed against taxable incomes, but if you just lodge your tax return each year, CSA will use your taxable income from that for your next assessment. For example, if your taxable was $50,000 in the 2018-19 financial year, your assessment for the 2019-20 financial year will be based on a taxable income of $50,000. If, after you file your tax return, your actual taxable income in 2019-20 turns out to be $90,000, then your assessment for 2020-21 will be based on a taxable income of $90,000.