Child Maintenance
Maintenance Calculations
Current position
25.Under the current ‘new scheme’ legislation, the information used to calculate maintenance includes: the non-resident parent’s net weekly income, the number of qualifying children, and the number of ‘relevant other children’ (those living with the non-resident parent whether or not they are children of that parent). The maintenance calculation can be adjusted if a change in circumstances is reported to the CSA, although a change of less than 5% in net weekly income would not result in an adjustment.
26.For the purposes of child maintenance, net weekly income is a non-resident parent’s income from employment or self employment, tax credits, or from an occupational or personal pension after deductions for income tax, national insurance, and contributions to an occupational or personal pension have been applied.
27.Once enough information is provided by the non-resident parent, a calculation is performed to establish how much maintenance is payable to the person with care. The basic rate of maintenance takes account of how many children the non-resident parent is required to pay maintenance for, and is based on a percentage of their net income, up to a maximum of £2,000 per week, which is:
15% for one qualifying child;
20% for two qualifying children; and
25% for three or more qualifying children.
28.A flat rate is payable by non-resident parents who are in receipt of benefit or earn less than £100 a week, and is an amount up to £5 per week.
Changes
29.The Act makes several amendments to how a maintenance calculation is arrived at and maintained. Gross weekly income details from the latest available tax year will be used to calculate maintenance instead of net, and this will usually be based on information already held and made available by Her Majesty’s Revenue and Customs (“HMRC”).
30.Alongside this, the percentages applied for the basic rate in relation to earnings of a non-resident parent between £200 and £800 per week, will change to:
12% for one qualifying child;
16% for two qualifying children; and
19% for three or more qualifying children.
31.New percentages will be introduced for non-resident parents whose earnings are over £800 per week. The percentages will apply in relation to earnings between £800 and £3,000 per week. They will be:
9% for one qualifying child;
12% for two qualifying children; and
15% for three or more qualifying children.
32.Percentages for relevant other children will also change to the same level as those for basic rate.
33.The level of flat rate maintenance for non-resident parents in receipt of a prescribed benefit, or earning less than £100 per week, will also be increased from £5 to £7 per week.
34.The Act will enable restrictions to be imposed on how often a maintenance calculation is changed. Annual reviews will take place to ensure the calculation reflects any changes in income or the relevant circumstance, specifically the income figure for the latest available tax year will be updated. Between annual reviews, the calculation will be revisited only where there has been a large change in income, or a fundamental change such as a child or children moving to live with the other parent.
35.The Act also requires the Commission to investigate what information and evidence is available, and obtain more if appropriate, before considering and deciding on a variation application received from a parent with care.
36.Another change relates to cases where both parents each have at least one child of the relationship living with them. In such cases, both parents are a person with care in relation to one child, and a non-resident parent in relation to another. Currently they would both be liable to make a maintenance payment. The changes will enable one liability to be offset against the other, so that only the parent with the highest liability actually makes a payment.
37.Child maintenance obligations of a non-resident parent under certain types of private arrangement will also be taken into account when calculating the amount of child support maintenance payable under the Act.
