Shared Care and Child Maintenance

Shared Care and Child Maintenance

When a parent makes an application to the Child Maintenance Service they calculate the amount due, using a formula that depends upon a number of factors such as the number of children, the paying parents income and how many other children the paying parent may have.

They then discount that amount to cater for shared care.  Shared care is where the paying parent shares some evening care responsibilities.

For each night on an average week, a paying parent is expected to have the children they take off 1/7th or about 14%.  They have to estimate, based on patterns, or if a court order exists, they base the discount on that.

You do not need to have a court order to prove shared care.  A regular pattern can be used as evidence.  For example if a child stays with the paying parent every Friday and Saturday night, it will be assumed that over the year they will stay with them 54 times.

This qualifies as a 2/7ths discount or a 28% reduction in maintenance to pay.  

The formula is set in legislation, meaning that it cant be changed by the CMS.  It is generally considered that where the child is sleeping at midnight determines where they are being cared for.  

Shared Care Breakdown

• 52 to 103 nights per year equals a 1/7th reduction.
• 104 to 155 nights per year equals a 2/7ths reduction.
• 156 to 174 nights per year equals a 3/7ths reduction
• More than 175 nights equals a 50% reduction and an extra £7 per week reduction for each child in the band.

It is therefore very important that both parents are aware of the shared care discount as it will affect the money.

Where parents are in dispute, the CMS will make a decision which is normally based in favour of the parent with care.  (This is because it is rare for a parent with care receiving money to say they have a child less than the paying parent states).

For example if the paying parent says the child stays for three nights, and the other parents states one night, they will grant one night shared care, as both parties have agreed its at least one night.  However its possible to argue this and overcome the issue, by appealing using the Mandatory Reconsideration process.

What About Day Care?

The CMS do not take daycare into account.  If the child stays with the receiving parent every night, but is looked after by the paying parent all day, the paying parent has to pay 100% of the child support maintenance due. 

However day care is important when dealing with HMRC concerning child benefit.

What About Other Discounts?

The amount of child maintenance charged can also be reduced by taking into account pension contributions, special expenses and other children.  

• To see how child support payments can be reduced for pensions, click here.
• To see how child support payments can be reduced for expenses, click here.
• To see how child support payments can be reduced due to other children, By clicking here..

Example

A child stays with the paying parent from Saturday morning, until 9pm on the Sunday.  They then sleep at the other parents house.  In this example, the child only sleeps at the house for one night, so only one night of shared care is discounted.  It may be two days, but only the nights count.

Summary

The Child Maintenance Service formula for calculation of child support is set by parliament, so cannot be deviated from  Its has many aspects, but the most important is shared care.  One night shared care per week, can reduce child maintenance by 14%.

Further Resources

Child Maintenance A Guide for Parents 

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Child Support 25 Percent Rule

When dealing with the Child maintenance Service, there is one misunderstood topic, known as the 25 per percent rule, which applies to child maintenance calculations, where there is a child support case through the Child Maintenance Service. The 25% rule might sound complex, but fear not, we're here to break it down for you. Simply put, this rule dictates that for your income to trigger a change in your Child Maintenance Service (CMS) calculation, it must either increase or decrease by at least 25 percent within a year. Let's unpack this further in the video below, and the text that follows.

The 25 Percent Rule in a Nutshell Imagine your income as the cornerstone of the CMS calculation. Its the most important part of the different parts of the CMS maintenance calculation. When you open a child support case with the CMS, they obtain from His Majestys Revenue and Customs known as HMRC, your most recent tax year to determine the percentage of your salary that needs to be allocated for child maintenance. Fast forward a year, and the CMS conducts an annual review by assessing your salary from the following tax year. This process is relatively straightforward when your income remains stable or only fluctuates slightly, say by three percent, from year to year. If it goes up by three percent, you pay more. If it goes down, you pay less. Understanding the 25 Percent Threshold Here's where the 25 percent rule comes into play. If your income changes by more than 25 percent between the two tax years up or down, your CMS calculation will adjust during the year, and not at the next review. The 25 percent rule primarily addresses changes that occur during the year, not as a basis for annual reviews. Examples to Clarify Let's consider a couple of scenarios. In the first case, Person A earns a salary of £10,000 per year, which increases to £12,000 per year. As this increase is not a 25 percent change, the CMS calculation remains unchanged for the rest of the year. However, this increase will be factored into the following year's CMS calculation. In contrast, Person B has a job paying £20,000 per year, and they receive a substantial pay rise to £30,000 per year. Since this increase exceeds a 25 percent change, the CMS calculation should be recalculated at this point, leading to an increased payment for the remainder of the year. This means that the income changes from historic to current income. Bonuses and Temporary Changes You might be wondering about annual bonuses or temporary income spikes. If your salary temporarily increases by less than 25 percent within a 12-week period, you usually don't need to notify the CMS. Temporary changes of less than 25 percent are often considered temporary by the CMS and are addressed during the annual review. However a bonus is normally taxable, so if it does not trigger an increase, your CMS may be higher in a future year, when they use the income from the bonus year to do the calculations. A Word of Caution A common pitfall is when people report a 20 percent increase in their salary to the CMS, and it's occasionally accepted even though it doesn't meet the 25 percent threshold. Also, situations arise where someone's salary jumps by 30 percent and then drops by 15 percent. The CMS might decline to decrease the payment, leaving the individual stuck paying the higher amount until the next annual review. Final Thoughts The 25 rule isn't as complicated as it may seem at first. To trigger a change in your CMS calculation, your income must increase or decrease by at least 25 percent within the year. This rule ensures that minor fluctuations won't require immediate adjustments, sparing you from unnecessary communication with the CMS. Always remember that temporary changes under 25 percent are always addressed during the annual review. On your Child Maintenance Service review date, the CMS will produce a new calculation which will be revised up or down, depending upon a change of income by at least £1. Its not a case that your income has to change by 25% in order for the calculation to change. If you found this guide helpful and want more information on specific topics, feel free to leave your queries in the comments. Don't forget to like and subscribe for more valuable insights, and together, let's make the child maintenance journey smoother for everyone.

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What Does Child Maintenance Cover

What Does Child Maintenance Cover

Child maintenance can be a complex topic to navigate, especially when it comes to understanding what it covers and what it doesn't. In this blog post, we'll delve into the intricacies of child maintenance, with a particular focus on school uniforms and additional expenses. If you're new to this blog, don't forget to join us on Youtube. Our Youtube Channel can be subscribed to at: https://www.youtube.com/channel/UCmKdH63SQdlSqqFwkc4hAKQ?sub_confirmation=1 Please like and subscribe to receive future videos on similar topics right in your YouTube inbox.

The Basics of Child Maintenance When you first open a Child Maintenance Service (CMS) case, you're likely to receive a booklet outlining how child maintenance is calculated and what the service entails. The booklet is called "About the Child maintenance Service - A guide for paying parens and receiving parents. Its refererence is CMSB001GB. The CMS is a government statutory child maintenance service operating in England, Wales, and Scotland. Its primary purpose is to ensure that parents who are separated contribute financially to their children's upbringing through regular child maintenance payments. No one is required to use the Child Maintenance Service. Parents are free to choose their own plan, howeever many choose to use the CMS. Defining Child Maintenance Child maintenance is essentially reliable financial support that aids in covering the everyday living costs of a child. The CMS aims to determine, collect, and distribute these payments on behalf of separated parents. By collect they do this in one of two ways. Direct pay - Where they tell you what to pauy, and you pay direct to the other person. Collect and Pay - Where they take the money and pass it on. There is a charge for this. Calculating Child Maintenance The calculation of child maintenance primarily revolves around the income of the paying parent. It's important to note that only the paying parent's income is taken into consideration, not their expenses or additional payments. There are different rates of child maintenance, including basic, reduced, and nil rates, based on specific circumstances. Consideration of Other Children The presence of other children, whether living with the paying parent or not, plays a role in the child maintenance calculation. If a parent has more than one child, the rates may vary accordingly. It's crucial to inform the CMS about any other children you have, as this information affects the final calculation. If you are a paying parent it may reduce your overall contributions. The CMS will not reveal the names of the other children. Only that there are other other children, and how many. Shared Care and the Child Support Calculation Shared care arrangements are also considered when calculating child maintenance. The number of nights a child spends with each parent per week can impact the amount paid or received. This shared care is factored into the calculation, and discounts are applied based on the number of nights spent, averaged over a forward looking year. School Uniforms and Extras One common query is whether child maintenance covers school uniforms and other extras. The answer is straightforward: child maintenance is meant to contribute towards the child's general living expenses. It doesn't specifically cover individual items like school uniforms, after-school activities, or school trips. The CMS calculation is designed to provide financial support for the child's overall well-being. The CMS do not provide a breakdown of items that CMS support payments cover, nor would they as the calcuation is based on the paying parents income, not the receiving parents expenditure. Private Arrangements for Extras If paying parents wish to contribute towards school uniforms, school trips, or other extras, they can make private arrangements. This can be a more flexible way to allocate resources according to specific needs. However, it's recommended to establish clear terms and conditions to avoid any misunderstandings. Legally, if the CMS is used to provide a calculation, the CMS amount must be paid, and that is enforcible in law. Neither party can make an arrangement to pay another figure, higher or lower, without the child support case being closed by the Child Maintenance Service Understanding Spending Allocation Child maintenance payments are intended to support the child's living costs, and how these funds are allocated is up to the receiving parent. While concerns might arise about how the money is spent, it's essential to recognize that the CMS calculation is a contribution to the child's overall expenses, without specifying where each portion should be allocated. A paying parent cannot withhold money if they are not happy with the spending. Conclusion Navigating the world of child support payments through the Child Maintenance Service, can be challenging, but understanding its fundamental principles can make the process smoother. Child maintenance primarily covers the general living costs of the child, and while it doesn't include specifics like school uniforms or extras, parents can make private arrangements for such expenses. Remember that child maintenance is about ensuring the child's well-being, and open communication between parents is key to achieving that goal. Facebook https://www.facebook.com/groups/197227785636347 Blogspot: https://childmaintenancehelp.blogspot.com/ Amazon: https://amzn.to/3EyVAue

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