Modifying Your Payment Plan to Decrease Child Support
Many parents are looking into ways to reduce child maintenance payments due to the financial strain that Covid-19 and rising living costs have placed on them.
In this guide, we'll go over child support payments in depth, including:
- How Child Maintenance Service (CMS) payments are calculated
- What should you do if your financial situation changes?
- How payment changes can be negotiated; and
- What happens if you do not pay child support?
We'll also look at who isn't required to pay child support and some options to consider if you simply can't keep up with your outgoings.
What is the Child Support Service?
The Child Maintenance Service (CMS) is a government-run service for parents who have been unable to reach a private agreement to cover their child's living expenses.
When parents divorce or have a child apart from each other, the CMS does not automatically intervene. Instead, the service exists if the two parents or guardians are unable to agree on payments to cover the costs of raising that child.
The CMS's primary responsibilities include:
- Determining how much should be paid
- Arranging for payment collection if a parent fails to pay
- Resolving disagreements about who is responsible for the child
- Finding missing parents if you don't know where they are
How does the CMS determine your payments?
If you're looking for ways to reduce child maintenance payments, it's important to understand how these payments are calculated in order to ensure you're paying what the CMS considers to be a fair amount.
The terms "paying parent" and "receiving parent" are used interchangeably.
The terms "paying parent" and "receiving parent" appear frequently in CMS guidance and this guide. To avoid confusion, it is critical to understand what these terms mean.
The paying parent is not in charge of the child on a daily basis. As a result, this is the individual who pays child support.
The receiving parent is the person in charge of the child's day-to-day care. Although this is typically the other parent, it can occasionally be a guardian. This individual receives the maintenance payments.
The CMS has a 6-step procedure for determining how much the paying parent should pay.
Step 1 Calculating your earnings
The CMS will contact HM Revenue and Customs to determine the paying parent's annual gross income. The term 'gross' refers to the amount before taxes, national insurance, and other deductions.
They will also inquire with the Department of Work and Pensions (DWP) to see if the paying parent is receiving any benefits.
Tax credits, student grants, and loans do not contribute to your taxable income.
Step 2 Examining what influences your income
The CMS will look for things that may have an impact on your gross income amount.
These could include pension payments or the costs of other children you support.
At this point, you can request that additional factors be considered, such as extra income, items you own, or any additional expenses you may have.
When the CMS has all of the information they need, they will calculate your gross weekly income.
Step 3 Making use of a rate
One of five rates will be applied based on your gross weekly income.
Rate of gross weekly income Weekly amount
Unknown or no provider £38 for one child, £51 for two children, and £61 for three or more children
£7 to £100, or if paying flat £7
A parent receives benefits.
£100 01 to £199 99 lowered calculated with a formula
A formula was used to calculate the basic range of £200 to £3,000
If the paying parent's income exceeds £3,000, the receiving parent may seek a court order for additional child maintenance.
Step 4 Taking into account other children
The CMS will consider the number of other children for whom the paying parent is responsible for maintenance or support. This could include children who live with them as well as financial arrangements for other children.
These expenses can range from food costs and travel expenses to boarding school fees.
Step 5 Making a decision
With all of this information, the CMS will make a determination on the final amount that the paying parent is expected to pay.
Step 6 Taking into account'shared care'
After the CMS calculation is completed, they will deduct from this amount based on the average number of'shared care' nights per week.
A'shared care' night is one in which the child spends the night with the paying parent.
How to Apply This Knowledge
Because many parents pay child support without a formal CMS agreement in place, this information can assist you in determining whether what you're currently paying is fair and in line with the amount of child support you are expected to pay.
You can use the.GOV website to figure out how much child support you will have to pay. The calculator will not transmit any personal or financial data to the DWP.
Some people are exempt from paying child support.
If you do any of the following, you will not be required to pay anything through the Child Maintenance Service:
- Share care with the other parent equally.
- Are enrolled in full-time education but have no income
- Are incarcerated
What can you do if your financial circumstances have changed?
Covid-19 has impacted the finances of millions of people, both employed and self-employed. Recently, significant increases in living costs have made even basic necessities difficult for some people to meet.
It's important to remember that child support payments are considered a priority payment, and you should make them before any unsecured loans or credit cards.
If you are unable to pay your maintenance on time, you must take a few important steps.
Step 1 Contact the other parent.
If it is possible and safe, your first step should be to speak with the other parent to see if you can reach an agreement.
It's critical to try to see things from their perspective as well as your own.
You could possibly ask if they would be willing to accept a temporary reduction until your circumstances change and you can afford to pay the full amount again. You might want to put a time limit on this so they don't feel like it will be forgotten.
If you are able to reach an agreement, you should notify the CMS. They may be able to provide additional assistance if your earnings have decreased significantly.
Step 2 If you are unable to reach an agreement, seek assistance from the CMS.
It will not always be possible to talk to or reach an agreement with the other parent involved. However, if your income has dropped by 25% or more (for example, if you've been laid off), you can request that the CMS recalculate your payments based on these new figures.
If your income has not decreased by at least 25%, you will be expected to continue paying your current amount.
The CMS charges a fee for this service, so it's preferable if parents can reach an agreement - but it's not required.
For the time being, you will be able to call the CMS and inform them of any issues affecting your ability to pay. They may agree to a lower amount for the time being, but they will need to see proof of your reduced income in the future.
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What happens if you fail to pay your maintenance?
Whether your agreement was reached directly between parents or was recommended by the CMS, ceasing payments can have serious consequences.
The CMS will total the missed payments and consider them a debt. They, like other creditors (people or businesses you owe money to), have a debt collection process that they will initiate as soon as possible - especially if you haven't spoken to them about financial problems you're experiencing.
If you continue to withhold payment, they may seek a court order to collect arrears directly from your wages or benefits before they reach your bank account.
Failure to pay can result in prison in rare cases.
How to Dispute What the CMS Says You Owe
If you believe the CMS calculation is incorrect, you can file an official appeal.
However, before you begin an appeals process, you should request that the decision be reconsidered by the CMS. This is known as'mandatory reconsideration.'
Why you should seek mandatory reconsideration
You can ask the Child Maintenance Service to reconsider their decision for a variety of reasons, including:
- You believe they made a mistake or made the wrong decision.
- Your circumstances have changed. For example, you might have a new child with a new partner, or your income may have changed.
- You have'special expenses' such as travel costs, school fees, or debt from a previous relationship.
This mandatory reconsideration may result in a change in the amount of child support you are required to pay. If you still don't agree, you can file an appeal with the Social Security and Child Support Tribunal. You must file this appeal within a month of the decision's date; if you do not, you must explain why.
What is the best way to make an appeal?
To file an appeal, you must first download and complete an SSC2C form. When finished, send it to the address listed on the form.
You can provide evidence to back up your claim.
The Social Security and Child Support Tribunal usually hears appeals after about 6 months. You will be invited to the hearing; however, even if you do not attend, a decision will be reached.
Getting rid of any other payments or debts you have
If you've looked into how to reduce child maintenance payments and discovered that there are no options, you might consider giving yourself some breathing room with other, less important payments.
Different payments, bills, and debts are prioritized at different levels. The following bills or debts are considered priority:
- Mortgage or secured loan fees
- The local government tax
- Bills for gas or electricity
- Telephone and internet bills
- Payments for television licenses
- Court fines
- Overpayment of tax credits
- Payments for hire purchases
- Unpaid income tax, social security, or VAT
- Child support arrears
These should be the first things paid because the penalties for failing to do so are severe.
Some payments and debts are regarded as less important:
- Cards de crédit
- Shop cards
- List your debts
- Loans without collateral (including payday loans)
- Water bills that have not been paid
- Benefits overpayments (excluding tax credits)
- Parking tickets that have not been paid
- Money owed to relatives or friends
It is critical that you do not simply stop making payments to lower priority creditors; instead, it is often a good idea to call them, explain your situation, and inquire about payment holidays or temporarily reduced payments. This will occasionally provide you with the financial space you require to pay your child maintenance in full.
If you can't see a time when your income will allow you to pay off everything you owe each week or month, you might want to look into debt solutions that will make things easier in the future.
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