Protected Earnings Amount when deducting child support
The Protected Earnings Amount (PEA) is the part of an employee's or contractor’s pay exempt from child support deductions.
It means you don’t deduct all of their pay for child support payments.
The PEA doesn't apply to deductions under section 72A notices.
The weekly PEA is equal to 75% of the maximum fortnightly basic rate of Newstart Allowance, for a person who is partnered with no dependent children.
The following amounts apply to pay dates from 1 January 2017 to 31 December 2017:
|Pay cycle||PEA calculation|
|Daily||$358.05 ÷ 7 days = $51.15|
|Fortnightly||$358.05 x 2 weeks = $716.10|
|4 weekly||$358.05 x 4 weeks = $1,432.20|
|Monthly||$51.15 x 30.4375 days per month = $1,556.88|
For child support purposes, a year is equal to 365.25 days. This allows for leap years. This means there are 30.4375 days in a month. This is equal to 365.25 divided by 12.
Figures are rounded where applicable.
The PEA is adjusted annually. If you currently deduct child support, you'll get a letter by December each year to let you know.
When to contact us
You must not make a deduction of child support that leaves an employee or contractor with a net pay of less than the PEA, after deducting tax and child support.
If you can't deduct the full amount of child support, send us the reduced deduction and explain the variation. To do this:
- call the Child Support general enquiry line
- complete the Child Support deduction form, or
- register for Child Support Business Online Services
You don't have to do anything about the outstanding child support that couldn't be deducted due to the PEA.