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Historic Or Current Income To Assess Child Support?

Child support is now calculated by reference to the non resident parent's gross weekly income, the details of which are provided by HRMC on a computer link to the Child Maintenance Service. Of course, that would be the last completed tax information which may be somewhat out of date.

It should be noted that the regulation applicable defines "the latest available tax year” as being any one of the last six tax years preceding the request for income information from the Child Maintenance Service! Potentially, this income may be over six years out of date?

Once assessed, the child support liability will be a fixed annual award and only reviewed after that time. The date is apparently fixed at the time of the assessment.

Previously, there was a tolerance level of 5% allowed for fluctuation in the Non Resident Parent's (NRP) income before this triggered what was a variation. These are now known as super sessions!

Under the new scheme, the review date having been fixed, will automatically trigger prior to that a request from the Child Maintenance Service to HRMC for the latest available tax year information.  A notification will then be sent out to the parents to include the new income data and proposed child support calculation. Any responses will be considered and then the child support fixed for the next twelve months.

Under the new regulations, child support will always be calculated on the basis of historical income unless a NRP's current income differs from that historical income by 25%. An application would have to be made by either party to the Child Maintenance Service. Of course, the NRP would apply if their income had dropped by at least 25% from the previous figures used in assessment. The Parent With Care (PWC) would apply if they believed it has increased by 25% or more from the previous assessment.

The PWC would only know this if they were aware of the year the information gleaned for calculation was. This is not, as we understand it, clear on the assessment document and enquiry should be made by the PWC.

Where child support has been calculated on a current income basis, there may be mid year checks by the service to ensure the 25% tolerance rule remains satisfied. This will involve the NRP providing contemporaneous income details and if they are unable to continue to demonstrate the 25% difference, we understand the calculation will revert to the historic income basis from the last review.

The difficult faced by the Child Maintenance Service is that whilst historic income is produced by  HRMC, any current income data is, of course, produced by the NRP (or their accountant). This will involve significant administration. Quite often any current information can be seasonal or otherwise subject to what the NRP is telling their accountant!

Child maintenance remains a complicated subject despite the best intentions of legislators.