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Parliament established a government agency, the Child Support Agency (“CSA”) now the Child Maintenance Service (“CMS”) to decide what level of maintenance should be paid from one separated parent to another for the support of their children. The child support system is very complex and our strong recommendation is that parents take legal advice before embarking far with their discussions.
Parents only have responsibilities and entitlements under the CMS system where a 5-fold test is passed, involving:
- Geographical restrictions: all parties are in the UK (with some limited exceptions);
- Age and stage: very roughly, the child is below A-level stage;
- Parentage: the child is the natural or adopted child of them both;
- Separation: the parties have separated (without which there cannot be a non-resident parent (“NRP”) and without a NRP, there is no jurisdiction); and
- Order: a maintenance order from the court is likely to exclude the jurisdiction of the CSA/CMS until the court order is 12 months’ old.
Where one or more of these requirements is not met then if there is a maintenance obligation it is likely to be the court that will decide it. The court also has responsibility for deciding whether payments should be made for:
- For the costs of disability where the child qualifies for Disability Living Allowance;
- For educational costs; or
- To top up the award because the NRP earns more than £156,000 gross per annum.
The parent who has care of the child to a greater extent than the other parent becomes the parent with care (“PWC”) and can claim provision from the NRP. The formula defining the level of payment is now operated by the CMS. Further information about the statutory child maintenance service can be found here.
The Government has published a calculator to help parents to estimate the cost of child maintenance. We have developed a more sophisticated calculator which we use to calculate our clients’ responsibilities and entitlements with data including:
- The gross income of the NRP is taken into account. This is likely to be taken from the last tax return. It looks only at earned income (but an application can be made to include un-earned income too).
- An application can be made to increase the income to a figure to reflect the higher income that the NRP could be earning if s/he were not diverting that income away.
- There are various limited applications that can be made to reduce the income eg. to reflect school fees or the costs of contact.
- Pension: The formula deducts payments made into a pension, for example, the monthly net contribution made to a defined contribution scheme.
- Other children: Children, broadly pre A level children, in the NRP’s household are taken into account.
- Overnight Stays: The number of overnight stays with the NRP will affect the payment calculation too.
There is some dispute as to how the CMS formula applies where the NRP earns more than £156,000 pa. In the case of Re TW & TM (Minors) 2015 EWHC 3054 (Fam) Mostyn J said:
“In my opinion the formula should apply even where the earnings of the father are in excess of the £3000 per week maximum provided for in the Act and the Regulations (emphasis added). If the earnings of the father were very much in excess of that then there would be a good reason to depart from the formula downwards, but if the income of the father is not unadjacent to the maximum then to my mind, subject to other factors, that of itself is not a good reason to depart from the formula.”
It is essential that you have a good understanding of the CMS formula and rules before entering into any commitments to make or receive child support payments. Please contact any of our specialist family lawyers for help or advice. Director James Pirrie is a leading expert in the field of child maintenance and has appeared before the House of Commons Public Accounts Committee to talk about the impact of the Child Maintenance Scheme. Take a look at his blog on the Child Maintenance Scheme:
For further information on this topic visit www.nacsa.co.uk.