Child Maintenance – Some Changes
If you are separating or divorced, or about to become so, and if children are involved you should be aware of some changes to the child support regime.
From 29th July 2013 the Child Maintenance Service (CMS) came into being. It is intended that eventually it will completely replace the old Child Support Agency (CSA).
Already the CMS deals with all new applications where there are 2 or more “qualifying children”. “Qualifying children” means that the children have the same parents and there is no existing case involving both these parents.
The principle change is that the amount of the payment of the payment will be based on the gross income rather than the net income of the non-resident parent.
The CSA will continue to deal with the all other new applications which will mostly be those by parents with one child.
It is important to say at the outset that if there is truly equal shared care then no child maintenance is payable. However if one parent is in receipt of Child Benefit then there is a presumption that they are “providing care” for the child and should therefore receive the payment.
Broadly speaking the calculation is as follows:
For gross income up to £800 per week (£41,600 per annum gross or £3,466 per month gross) child support is payable:
For 1 child at 12%
For 2 children at 16%
For 3 or more children at 19%
Where the paying party is earning between £800 per week and £3,000 per week (£156,000 per annum) then the following rates apply:
For 1 child at 9%
For 2 children 12%
For 3 or more children at 15%
The next step is to make a deduction for other children living in the non-resident parent’s household. There are also staged reductions for the extent of shared care.
“Gross Income” is defined as the total of the non-resident parent’s income from all employment, self employments and pensions. That person’s pension contributions may be deducted.
Other points to note are that:
- The flat rate for those with an income of less than £100 per week gross is now £7.
- There is reduced rate for those earning between £100 – £200 per week.
- In the future it is intended to bring in a fee for making the application and collection charges payable by both the non-resident parent and the receiving parent.
- Payments can of course be agreed between the parent in order to prevent the stress, animosity and delay incurred to applying to the CMS.
- Agreement as to child maintenance can be recorded in the financial consent order made in the divorce proceedings. But after 12 months from the date of the order either parent can make an application to the CMS (or CSA) for an assessment to be made.
Whilst the new regime endeavours to make the calculation more straightforward by removing the necessity to calculate “net income”. It is difficult to see any other clear improvements nor any better modes of enforcement. It still all looks cumbersome and time consuming, and sadly having the potential to prolong animosity between the parents.
For further advice please contact Stuart Duncan on 01635 917508 or firstname.lastname@example.org.