Deductions under a section 72A notice

We may send you a notice pursuant to section 72A, or a section 72A notice. If we do, you’re legally required to deduct the amount of child support we ask you to.

If you get a notice, you must pay us some money you would normally pay to your employee or contractor.

How much child support to deduct

The notice will tell you the amount of money you need to pay us. It may ask you to pay:

  • a cents in the dollar amount
  • periodic amounts
  • a lump sum amount.

You need to follow the instructions in the notice until you’ve paid us the total amount of money owing. We’ll tell you what the total amount is in the notice.

If you don’t currently owe your employee or contractor money you won’t pay us anything now. You must deduct the money next time you owe them money in the future.

Making deductions under a section 72A notice

You need to do the following for each deduction you make.

  1. Check the notice for the amount you need to deduct.
  2. Deduct any tax from the gross payment, excluding GST, before making the child support deductions.
  3. Deduct the lump sum amount requested. Or, if the notice asks for a cents in the dollar amount, work out the deduction. You do this based on the person’s gross pay excluding GST.
  4. Send the deductions to us within 7 days.
  5. Pay the remaining amount to the person or use it to make other deductions.

You can't change the amount we ask you to deduct unless we send you another notice. Only we can authorise you to change the amount to deduct.

Getting more than 1 notice

You may get more than 1 notice asking you to make deductions. This could be separate notices from Child Support and Centrelink, or another government authority.

In general, you should comply with the notices in the order you get them. However, you must comply with a Child Support notice first if you get both:

  • a notice from us requesting you to make deductions
  • a garnishee order from a Commonwealth, state or territory court.

This is regardless of whether you get the Child Support notice before or after the garnishee order.

Call us on the Child Support general enquiries line if you’re unsure what to do if you get multiple notices. You’ll need to give us your reference number or ABN when you call.

How to pay us the deduction

We prefer you to pay deductions via BPAY. You can read more about this and other payment options for child support deductions. It’s important that you use the correct payment reference number. The 16 digit reference number is unique for every person you’re deducting for under a section 72A notice.

To pay a deduction for 1 person by cheque, use the Section 72A Notice – remittance slip for employers form.

If you’re deducting from more than 1 person’s wage, you need to give us both:

  • a breakdown of the total deductions you pay us
  • the report of any deduction variations.

If you’re registered for Child Support Business Online Services you can report the variation online. Otherwise let us know by either:

The post and fax details are on the form.

If you’re not sure what to do, call us on the Child Support general enquiries line. You should do this before you send the deductions.

How to calculate deductions

The way you make deductions depends on the type of deduction we ask you to make.

For all types of deductions, you must first deduct tax. Do this before making any child support deductions.

Tax amounts quoted are examples only. Refer to the Australian Taxation Office for rates applicable to your employee.

Example of calculating and making a cents in the dollar amount deduction

Daniel is a subcontractor and earns $450 a week excluding GST.

We send a section 72A notice to you as Daniel’s contractor. It requires you to deduct 15 cents for every dollar he earns. We calculate child support using the gross payment excluding GST.

If there’s not enough funds to cover child support and tax deductions, deduct the full amount of tax first.

You must make a tax deduction first, and then make the child support deduction. You calculate this by multiplying $450 by 15 cents ($0.15). You then pay us within 7 days of making the deduction.

Payment and deduction Total payment Tax deducted Deducted child support Pay remaining
Amount $450.00 $24.00 $67.50 $358.50

Example of making a periodic amount deduction

Jamie usually gets paid between $300 and $500 excluding GST each week.

We send a section 72A notice to you as Jamie’s employer that requires you to deduct $110 per week.

Jamie earns:

  • $500 in the first week
  • $450 in the second week
  • $90 in the third week.

Week 1

Payment and deduction Total payment Tax deducted Deducted child support Pay remaining
Amount $500 $38 $110 $352

Week 2

Payment and deduction Total payment Tax deducted Deducted child support Pay remaining
Amount $450 $24 $110 $316

Week 3

Payment and deduction Total payment Tax deducted Deducted child support Pay remaining
Amount $90 $0 $90 $0

In Week 3, Jamie earns less than the deduction amount. You can’t deduct the full $110, you only deduct $90.

As Jamie is claiming a tax-free threshold, he doesn’t pay any tax for earning $90 in week 3. However, if he did need to pay tax, you’d need to deduct the full amount of tax first.

Example of making a lump sum amount deduction from a termination payment

Alex’s weekly salary is $600. Alex resigns and cashes out 5 weeks of annual leave.

We send a Section 72A notice to you as Alex’s employer for a lump sum amount of $962.

Payment and deduction Total annual leave payment Deducted child support Pay remaining
Amount $3,000 $962 $2,038

You need to pay $962 to us within 7 days of making the deduction.

You need to deduct tax from her gross payment. You must do this before making any child support deductions. Tax deduction requirements may vary for lump sum payments. We didn’t include them in this example.

Read more Child Support information for employers.

Page last updated: 5 June 2019