New child maintenance powers announced

October 30, 2017, By

With effect from early next year, child maintenance cheats will no longer be able to take advantage of the ‘joint account’ loophole.

Under current rules, where a parent owes child maintenance the Child Maintenance Service (CMS) cannot deduct money held by the parent in a joint account  and so a number of parents have made use of this loophole to evade their responsibilities to their children.

Changes to the system will allow for deductions to be made from joint accounts when there are insufficient funds in the parent’s sole name account. This will be subject to a number of safeguards:

  • Only money held by the paying parent can be pursued. Before a deduction from a joint account can be made, the CMS will check that the money being pursued does indeed belong to the paying parent.
  • Before a deduction is made, both joint account holders will have a right to make their case to the CMS.
  • Deductions from joint bank accounts will be limited to a maximum of 40% of the paying parent’s weekly income.

Although the new powers will be welcomed by those parents who have been left out of pocket by the existing loophole, the process of determining who holds what money in a joint account is potentially fraught with difficulty, and likely to be time-consuming. The CMS believes the changes will result in around £390,000 of extra child maintenance being collected.

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