Limited child support agreement
A limited child support agreement lets parents set their own child support terms without going to court or paying for legal advice. It works alongside the standard assessment, not instead of it.
The key restriction is that the agreed amount cannot be lower than the formula amount, which limits how much flexibility parents actually have.
Definition
A limited child support agreement is a type of child support agreement where the parties decide on the rate of child support and how it is to be provided.
There must be an administrative assessment in place for the relevant children before a limited child support agreement can be accepted by the Registrar. The rate of child support payable under a limited child support agreement cannot be less than the rate payable under the relevant administrative assessment on the day the agreement is submitted for acceptance.
A limited child support agreement can be accepted by the Child Support Registrar without the need for the parties to seek independent legal advice.
Definition source: Guides to Social Policy Law, Child Support Guide, Version 4.97, released 20 March 2026, Limited child support agreements.
Role in the formula
A limited child support agreement does not replace the formula. The formula still runs in the background and sets the minimum amount that must be paid.
The agreement must match or exceed the assessed annual rate. If it falls below that amount, it cannot be accepted. This makes the formula a floor that the agreement cannot go under.
The formula is also used to create a notional assessment after the agreement is accepted. This is used for things like Family Tax Benefit calculations and to test whether the agreement still meets the rules.
Because of this structure, a limited agreement mainly changes how payments are made rather than reducing what is paid. It can include non-cash items such as school fees or health insurance, but their value must still meet or exceed the assessed amount.
Example
A parent is assessed to pay $8,000 per year under the formula. Both parents agree that instead of regular cash payments, the payer will cover $6,000 in school fees and $2,000 in cash.
This agreement can be accepted because the total value is $8,000. If the agreement only covered $7,000 in total value, it would not be accepted because it falls below the assessed rate.
What it means if you are the paying parent
A limited agreement lets you direct part of your child support into specific costs while still receiving credit for it. This is commonly used for expenses like school fees, health insurance, or other agreed items.
You are still required to meet at least the assessed amount overall. The benefit is control. Instead of paying all cash, you can ensure part of your contribution is used in a defined way that supports your child directly.
This can reduce disputes about how money is spent. It also creates a clearer link between what you pay and what the child receives, while staying within the rules of the formula.
What it means if you are the receiving parent
A limited agreement can increase the total value you receive compared to the formula alone. This is because the agreement must meet or exceed the assessed amount, and may include additional items on top.
You may receive a mix of cash and direct payments, such as school fees or medical costs. This can improve financial certainty, especially for large or recurring expenses that would otherwise need to be covered from general child support payments.
The trade-off is reduced flexibility. Some of the support is locked into specific uses rather than cash.
Limited vs binding child support agreements
A binding child support agreement works differently. It requires each parent to obtain independent legal advice before signing and does not have to follow the formula. The agreed amount can be higher or lower than the assessed rate, and the agreement can operate without an assessment in place.
Binding agreements involve legal fees because each parent must obtain advice, and they are harder to change once signed.