Child Support & Tax Credits

Despite any other failings of the the Child Support Agency I find the website of is generally very good. When the non resident parent has children living in their household their net income is reduced by an allowance before the child maintenance assessment is calculated. Information about what happens if the non-resident parent has other children living with them is on page 15 of the CSA leaflet How is child maintenance worked out? available to download here;

If the non-resident parent pays the basic rate, we will not take
into account:
• 15% of their net weekly income, if there is one child living
with them
• 20% of their net weekly income, if there are 2 children living
with them, or
• 25% of their net weekly income, if there are 3 or more
children living with them.

However one piece of information parents seem to have difficulty accessing is that when the non resident parent has children living in his/her household and he/she earns more than their new partner the household's working family tax credits are added to their net income before the CSA assessment.

The Child Support (Maintenance Calculations and Special Cases) Regulations 2000 set out the position in Rule 11, Part IV TAX CREDITS, Schedule , Statutory Instrument 2001 No. 155;

(2) Where working families' tax credit is payable and the amount which is payable has been calculated by reference to the weekly earnings of the non-resident parent and another person -

(a) where during the period which is used by the Inland Revenue to calculate his income the normal weekly earnings (as determined in accordance with Chapter II of Part IV of the Family Credit (General) Regulations 1987[42]) of that parent exceed those of the other person, the amount payable by way of working families' tax credit shall be treated as the income of that parent;

(b) where during that period the normal weekly earnings of that parent equal those of the other person, half of the amount payable by way of working families' tax credit shall be treated as the income of that parent; and

(c) where during that period the normal weekly earnings of that parent are less than those of that other person, the amount payable by way of working families' tax credit shall not be treated as the income of that parent.