Child Maintenance changes

For some years it has been a cause of criticism and concern that the Child Maintenance Service (CMS) does not take into consideration any notional income that a non-resident parent (NRP) may be deemed to receive. This meant that a NRP who was asset rich but had a low taxable income would have a low child support liability.

The Child Support (Miscellaneous Amendments) Regulations 2018 have changed the position. They have reintroduced the assets variation ground (previously in force under the 2003 scheme) whereby if a Parent With Care (PWC) can demonstrate that the NRP has a legal or beneficial interest in certain assets which exceed the prescribed value of £31,250, then the value of the assets will be treated as additional income of the NRP. The assets will be deemed to generate an income at the rate of 8% (the judgement debt rate) of the value.

This variation ground will apply to all kinds of assets; land, rights in / over land, money, (including funds due to the NRP), gold, silver, platinum, bullion bars, coins, shares, stocks, unit trusts, securities, unenforced chose in action (which it would be reasonable to enforce) and virtual currency which is capable of being exchanged for money.

If you have any queries about this article please contact jonesnickolds on 0203 405 2300 or contact@jonesnickolds.co.uk