Change of Assessment (COA) Reason 8

A parent may apply for a Change of Assessment (COA) in a child support case under Reason 8 when taxable income does not fairly show a parent’s financial capacity. Services Australia may look at income, earning capacity, property, financial resources and arrangements that reduce reported income.

Reason 8 may apply to business owners, parents working below their usual capacity, people with substantial assets, or anyone whose tax return gives an incomplete financial picture.

What Reason 8 Means

Reason 8 allows Services Australia to look beyond the income shown in a parent’s tax return. It applies when the standard assessment does not properly reflect one or both parents’ income, earning capacity, property or financial resources.

The application form describes Reason 8 as follows:

The assessment does not correctly reflect one or both parents’ income, property and/or financial resources.

A parent may therefore ask for a different assessment where reported taxable income gives an incomplete or misleading picture. Services Australia will only make a change where the circumstances are considered special and the existing assessment is unfair.

When Reason 8 May Apply

Reason 8 may apply where a parent appears to have more financial capacity than their taxable income suggests. Common situations include:

• Reduced earnings: A parent works part-time, takes a lower-paying job, stops working or studies instead of working.
• Business income: A family business reports little profit because of expenses, depreciation, losses or payments to related people.
• Income arrangements: Money or benefits are redirected through a company, trust, another person, salary packaging or voluntary superannuation contributions.
• Property and other resources: A parent owns substantial assets, has access to funds or receives a large lump-sum payment that is not reflected in taxable income.

Any of these circumstances may justify an application, but none automatically leads to a change. The applicant must provide evidence showing that the current assessment is unfair and that the other parent’s financial capacity can be reasonably identified.

Before Applying for Reason 8

A Reason 8 application can lead to a lengthy and adversarial review, so check whether the assessment can be corrected another way first. A recently lodged tax return, an income estimate or updated care information may resolve the problem without a formal Change of Assessment.

Apply under Reason 8 when the standard assessment still gives an unfair picture of a parent’s financial capacity. Be ready to explain exactly what is missing from the formula and provide documents to support the claim.

Reason 8A and Reason 8B

Reason 8 has two parts. Reason 8A looks at financial resources a parent already has, while Reason 8B looks at income the parent may be capable of earning.

• Reason 8A: This may apply where taxable income leaves out assets, business benefits, retained profits, lump sums or other available resources.
• Reason 8B: This may apply where a parent stops working, reduces their hours or moves into lower-paid work despite having the ability and opportunity to earn more.

A case may involve either part or both. Identify which financial issue applies before gathering evidence or completing the application.

How to Support Your Application

You will rarely have complete information about the other parent’s finances. Your task is to identify the financial issue clearly and provide any reliable information you already have.

For Reason 8A, explain what income, property or financial resource may be missing from the assessment. For Reason 8B, explain how the parent’s work situation has changed and why they may still have the capacity to earn more.

Useful information may include:

• documents already available to you
• details of businesses, trusts, properties or employers
• past earnings, qualifications and employment history
• specific payments, benefits or financial arrangements
• messages or other records supporting your claims

Services Australia will normally send each parent a detailed list of financial information to provide. The other parent may respond fully, partly or not at all.

Services Australia can formally require information in some circumstances, but is not obliged to investigate the case for you. Give the case officer specific facts and useful leads rather than broad suspicions or accusations.

How a COA Case Is Assessed

The case officer is meant to decide whether the standard formula gives an unfair result in the circumstances of the case. A financial difference alone does not automatically justify a change.

The officer should consider:

• the application and the other parent’s response
• the financial information provided by both parents
• whether special circumstances exist
• whether a different assessment would be just and equitable
• whether changing the assessment would otherwise be proper

For Reason 8A, the officer should assess income, property and financial resources not properly reflected in taxable income. For Reason 8B, the officer should consider whether a parent has reduced their earnings despite having the capacity and opportunity to earn more.

Current COA Figures

In 2024–25, Services Australia received 14,611 Change of Assessment applications and finalised 15,538. Applications received and applications finalised are separate counts, as some cases carry over between financial years.

Reason 8 dominated the workload. Seventy per cent of applications concerned a parent’s income, property, financial resources or earning capacity. That represents about 10,200 Reason 8 applications during the year.

Of all COA applications finalised, 43% resulted in a change to the child support rate. The published figure does not show whether the applicant received the change requested, obtained a different result or was left worse off. Services Australia also does not provide separate figures for Reason 8A and Reason 8B.

Source: Services Australia Annual Report 2024–25

What Earlier COA Figures Show

Historical figures show that Reason 8 was the main basis for seeking a Change of Assessment. They also show that COA decisions were commonly disputed but rarely overturned through an objection.

The figures reveal an unusual combination. COA applications frequently produced a changed assessment, but parents who objected to the result had a relatively low chance of having the original decision overturned. That pattern reflects the broad discretion given to COA decision makers and the deference later reviewers commonly gave to their findings.

Sources: Child Support Agency, Facts and Figures 2008–09, tables 2.7 and 2.8; Department of Human Services, Annual Report 2014–15; Henderson-Kelly, analysis of child support objections.

What a COA Decision Can Change

A COA decision may leave the assessment unchanged or replace part of the standard formula with a different financial figure.

The case officer may:

• use a different income amount for one or both parents
• add financial resources not shown in taxable income
• assign an earning capacity under Reason 8B
• set the change for a particular period

Where extra financial capacity can be identified and valued, the full amount may be reflected in the assessment. Where the information is too uncertain, no change may be made.

Why COA Outcomes Can Be Unfair

A COA decision depends heavily on what can be seen, proved and valued. That can produce uneven results.

Problems may arise where:

• a transparent parent has visible assets or business records, while an uncooperative parent provides little information
• earning capacity is based on income the parent does not currently receive
• assets are treated as available even when they produce little cash flow
• a decision to study, reduce work or change jobs is viewed as affecting child support

Parents are not generally required to sell assets, abandon study or maximise their income at all times. Even so, a COA may be based on what a parent could earn or access rather than what they actually receive.

The result can feel harsh where the assessed financial capacity exists only on paper. It can also favour a parent whose finances are difficult to trace or who provides limited information.

If You Disagree With the Decision

You can object if you believe the COA decision is wrong. An objection asks Services Australia to review the decision and provide written reasons.

Explain which findings you dispute and provide any evidence that was missed or misunderstood. Repeating the original application without addressing the case officer’s reasoning is unlikely to help.

If the objection is unsuccessful, you may be able to seek an external review through the Administrative Review Tribunal. Court action is also possible in limited circumstances, but is usually a much larger and more difficult step.

Related: Child Support Objections and Reviews