Our Top Tips On Calculating Child Maintenance

• Published date: 13 October 2021
• Subject Matter: Family and Matrimonial, Family Law
• Law Firm: Shoosmiths
• Author: Ms Caroline Watson and Nicola Wilburn-Shaw

Many separating parents use the Government's online calculator to agree their child maintenance payments.

We are fully supportive of parents reaching their own agreements, however using the online calculator may not always result in the right payment if parents are not fully conversant with the rules. Even parents who formally apply for an assessment by the Child Maintenance Service (previously The Child Support Agency) need to be on their guard.

Tip 1: Ensure you use accurate and up to date gross income figures

Maintenance calculations will be based on gross income figures without any deductions for tax or national insurance. Income will include employment income, pension income (but not UK social security pension), social security income and trading income (after any carry forward trade loss relief). Gross income is then adjusted to take account of any pension contributions made during the year.

If there is a formal assessment by the Child Maintenance Service (CMS) gross income will be determined using figures provided by HMRC in a self-assessment tax return or under pay as you earn (PAYE) regulations. if you are negotiating a private agreement don't just accept a wage slip or drawing statement as evidence of gross income. Ask for the P60 or tax return to check last year's income and ask for an explanation if there are any discrepancies.

If the paying parent's current income differs from their historic income by a figure that is at least 25% of the historic income the CMS may use their current income. Whilst historic income figures must be provided by HMRC current income figures can come from any source that the decision maker considers to be reliable.

Tip 2: Check for any additional income

A variation can be considered by the CMS if there is evidence that the paying parent:

• Has unearned income
• Has income from assets exceeding an aggregate prescribed value of '31,250
• Is on a flat or nil rate but has gross weekly income equal to or more than '100
• Has diverted income.

Rental income and income from savings and investments are not automatically included when assessing gross income. You will therefore need to consider making a variation application to ask for...