In my last blog I discussed the changes to the payment and collection of child maintenance. In this blog I will highlight the new ways in which child maintenance will be assessed by the Child Maintenance Service (CMS).
Perhaps most importantly and surprisingly for the first time, HM Revenue & Customs will provide wage data to the CMS in order to calculate the appropriate level of payment. This should lead to more accurate calculations both in respect of employed and self-employed payers.
The second move also strikes to defeat certain tactics employed by parents seeking to pay less. The way child maintenance is assessed is based on the payer’s gross income as opposed to being based on their net income as has historically been the case. You may ask what difference this makes, if every worker has tax and national insurance deducted from their wage? Sometimes employees have other deductions made from their wages, not to the state, but for their personal benefit. These include deductions for pension contributions or health insurance. It is not unheard of for the paying parent to up their pension contributions in order to minimise the sums payable to the other parent. Under this new structure all that stops. The formula for calculating child maintenance moving forward will be as below.
If the gross weekly salary is less than £800:-
One child = 12% of gross income.
Two children = 16% of gross income.
Three children or more = 19% of gross income.
If the payer has a weekly salary of more than £800 they will pay in accordance with the formula above and in addition will pay the following on the remainder over the £800:-
One child = 9% of gross income.
Two children = 12% of gross income.
Three children or more = 15% of gross income.
The amount of child maintenance payable will still be reduced by the amount of nights the children stay with the paying party. Payments will be set at a level for a fixed term of 12 months once the payer has been assessed. This will be checked annually.
If the payer has an income over £3,000 per week it is possible to apply for a top up order under Schedule 1 of the Children Act 1989. If you believe that your ex-partner is earning in the region of £3,000 per week there are options available to you and you should seek independent legal advice.
Our team of family lawyers at Slater Heelis LLP will be able to assist you.