Deductions under a section 72A notice (garnishee)

How much child support to garnishee

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

• 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 owed. We’ll tell you the total amount in the notice.

If you currently don’t 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

For each deduction you make you need to do all of the following:

• check the notice for the amount you need to deduct
• deduct any tax from the gross payment excluding GST, before making the child support deductions
• deduct the lump sum amount requested
• if the notice asks for a cents in the dollar amount based on the person’s gross pay, exclude GST when working out the deduction
• send the deductions to us within 7 days
• 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.

Also you don’t apply a Protected Earnings Amount to a section 72A notice.

When you get more than one notice

You may get more than one notice from a government authority asking you to make deductions. This could be separate notices from Child Support, Centrelink or another government authority. Generally, you should comply with each notice as you get them.

However, if you get a notice from Child Support and a court order from a Commonwealth, state or territory court, the Child Support notice will take priority.

If you get more than one notice and you don’t know what to do, call us on the Child Support enquiry line. You’ll need your reference number or Australian Business Number (ABN) ready to quote when you call us.

How to pay us the garnishee

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.

If you’re reporting Child Support through Single Touch Payroll you must use your employer payment reference number when making your payment.

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

Deducting from more than one person’s wage

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

You need to give us a breakdown of the total deductions you pay us.

If you’re not reporting through Single Touch Payroll or Child Support Business Online Services you need to complete a Child Support Deductions Report for employers form.

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.

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

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. You must 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 deductions for child support and tax, we’ll deduct the full amount of tax first.

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

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 all of these amounts:

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

Week 1

Week 2

Week 3

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. 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.

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. Deducting tax requirements may vary for lump sum payments. We didn’t include them in this example.

Read more Child Support information for employers.