Change of Assessment (COA) Reason 8
A child support change of assessment (COA) is a manual change by a government officer acting under the Child Support (Assessment) Act. It follows a formal application for a COA on the basis that actual financial circumstances are not adequately captured by reported taxable incomes. Reason 8 is the most common basis for a parent seeking a COA and is the focus of this page.
This explanation reflects both the statutory framework and the way Reason 8 is applied in practice, informed by published administrative guidance and extensive feedback from parents who have gone through the COA process.
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Reason 8 concerns the capacity of parents to financially provide for children. You can select reason 8 in the Application to Change your Assessment – Special Circumstances form when:
The assessment does not correctly reflect one or both parent’s income, property and/or financial resources.
A parent’s financial capacity is normally measured by the income recorded in their last tax return, consistent with the default administrative assessment formula. However, as recognised in the Child Support Guide and Ombudsman reviews, this can produce an unfair or distorted outcome where current income is materially different, where financial resources are not income-producing, or where income does not reflect actual earning capacity.
Applying for an assessment change should not be done lightly as it can lead to a time-consuming and adversarial review process. In many cases, Child Support officers themselves recommend that parents first explore simpler administrative options, such as income estimates or updated tax data, before lodging a COA.
The most common Reason for a COA [Change of Assessment] is Reason 8 when ‘the income, earning capacity, property or financial resources of one or both of the parents’ is not properly reflected in the formula assessment. COA decisions based on this Reason seem to be one of the most contentious areas of decision making for the CSA. It is also a common cause of complaint to this office.
Child Support COA Statistics
18,092 child support change-of-assessment applications were filed in 2014-15. By far, the most common reasons for seeking a variation are “income, property or resources of parents” and “earning capacity” (both Reason 8 types) (Child Support Agency, ‘Facts and Figures 08-09’, p 20, table 2.8).
Historically, close to two-thirds of applications result in an assessment variation (p 19, table 2.7). The number of objections to change-of-assessment decisions in 2014-15 was 3,056, representing around 17% of applications (Department of Human Services Annual Report 2014-15, ‘Child Support’). While approximately 2 out of 3 applications produce a change, only around 10–20% of objections are upheld, reflecting the high degree of deference given to original COA decisions (Henderson-Kelly).
4-Step Assessment Process
If no parties appeal against the eventual decision, a change of assessment (COA) because of special circumstances follows a standard four-step administrative process.
1. Written application
Either parent (payer or payee) can apply for a COA. Applications must be made in writing using the Application to Change your Assessment – Special Circumstances form.
Sufficient information must be provided for the application to proceed. Applications may be refused at this stage where no recognised ground is established or where, on the face of the application, a change would not be just and equitable or otherwise proper under Section 117 of the CSA Act.
2. Written response
If the application is accepted, the Department of Human Services (DHS) will send a copy (and any accompanying documents) to the other party along with a response form: Response to Application to Change your Assessment – Special Circumstances. Responding to an application is not compulsory, a feature of the process that has significant practical consequences.
3. Discussion with decision maker
Each party is generally offered an opportunity to discuss the application and response with the decision maker by phone. These discussions assist the officer in understanding the submissions but do not convert the process into an investigative inquiry.
While the DHS may request further information, officers are not investigators and rely primarily on material provided by the parties. The process is intended to be transparent, with each party informed of, and given an opportunity to comment on, the essential considerations and information relied upon.
4. Decision based on law
The DHS will consider and balance the evidence before it, including written and oral statements and any supporting documents, against the CSA Act and relevant policy guidance in the Child Support Guide. The decision must be legally supportable on the material available.
A decision to change an assessment amends the existing administrative assessment. While any component variable may be adjusted, Reason 8 decisions most commonly involve an increase to a parent’s assessed taxable income. Changes may be backdated by up to 18 months prior to the application date.
Situations Covered by Reason 8
Reason 8 casts a deliberately wide net. In principle, any financial resource that could reasonably be used to support children, but is not captured in taxable income, may be taken into account.
Examples of situations that may give rise to a change of assessment include where a parent:
- has substantial property or other assets that produce little net income
- is working part-time instead of full-time
- has taken a lower-paying job
- has voluntarily become unemployed
- is studying instead of working
- is making little money from a family business
- has arrangements that divert income to another person or entity
- overpays related employees in a family business
- claims business expenses that generate personal benefit
- reports low business income due to depreciation or prior-year losses
- uses salary packaging or voluntary superannuation contributions
- has received a large lump-sum payment
Whether these circumstances actually lead to a change depends entirely on the evidence presented.
How Reason 8 Is Interpreted by the Department
In practice, Reason 8 decisions do not follow a reliably consistent method. While decision makers draw on the same legislative provisions and policy materials, outcomes vary significantly depending on how individual officers interpret financial information, assess credibility, and exercise discretion. Decision makers are not accountants, and there is no fixed or formulaic approach to quantifying capacity beyond broad guidance. The Department does not proactively test, investigate, or reconstruct a parent’s financial affairs beyond the material put before it.
This produces outcomes that are often variable, subjective, and difficult to predict.
First, where additional financial capacity is clearly identified and supported by evidence, it will usually be included in the assessment in full, subject to limited exceptions. In those cases, assessments are often set to the parent’s deemed capacity without allowance for hardship, lifestyle, or personal preference.
Second, where apparent capacity is not supported by usable evidence, no adjustment may be made at all. Suspicion, inference, or perceived unfairness is not enough. Decision makers must be able to articulate and quantify capacity on a defensible evidentiary basis. Where a parent is opaque or uncooperative, that basis may simply not exist.
The result is not balanced discretion, but a bifurcated system. Transparent parents with visible but unrealised capacity are exposed to full adjustment. Opaque parents with equal or greater capacity may remain assessed on reported income alone. This outcome reflects the limits of administrative decision making, not an endorsement of the underlying financial reality.
Why Reason 8 Decisions Are Often Unfair
Reason 8 is necessary. Without it, parents could easily manipulate income to avoid child support obligations.
But the current system is heavily weighted toward policing avoidance rather than assessing genuine, complex financial reality.
Discretion exists on paper, not in practice
The CSA Act uses open-ended language such as “reasonable” and “adequate.” COA decisions are meant to involve discretion and judgment.
In reality, decisions are predictable. Selected objects of the Act are elevated and applied mechanically, even where they sit uneasily with the facts.
The duty to maintain a child is overstretched
Section 3 of the Act states that parents have a primary duty to maintain their children, taking priority over other commitments beyond self-support and dependent children.
That principle makes sense when applied to spending choices. It does not translate cleanly to unrealised financial capacity or to life decisions that affect income.
In practice, decision makers are sometimes required to assess whether a change in work, study, or employment conditions was motivated wholly or partly by a desire to affect child support. This inquiry is not governed by objective tests. It turns on inference, credibility, and judgment.
Two parents may make identical decisions for identical reasons, yet receive different outcomes depending on how their explanations are interpreted. There is no statutory threshold for when a motivation becomes impermissible, and no requirement that child support be the dominant or sole factor. This leaves a wide area of discretion and subjectivity.
There is no legal obligation to:
- sell assets
- abandon study
- remain in a damaging job
- maximise income at all times
Yet Reason 8 decisions often proceed as if those choices were mandatory, particularly where a decision maker concludes that child support considerations formed part of the parent’s reasoning.
Real budgets are ignored
Once theoretical capacity is identified, assessments are commonly set at that level regardless of actual cash flow.
Hardship is dismissed on the basis that the parent could realise capacity, even where doing so is unrealistic, damaging, or practically impossible.
This produces outcomes where parents are assessed on income they do not earn, do not receive, and may never realistically access.
The Structural Outcome
The combination of:
- non-compulsory cooperation
- limited investigative powers
- rigid internal interpretations
- and a focus on deterrence
produces a distorted system.
Some parents with genuine financial capacity are assessed accurately.
Others, who are equally or more resourced but opaque or uncooperative, escape scrutiny entirely.
Meanwhile, parents with visible but unrealised capacity bear the full weight of the scheme.
That imbalance is not accidental. It is structural.
