Recent changes in child maintenance regulations are set to affect a sizeable number of parents living in England and Wales.
The changes which came into effect on November 25 2013 focus on child maintenance calculations. The Child Support Agency (CSA) has been disbanded and a new body to be known as the Child Maintenance Service (CMS) is now responsible for this area.
Parents will have two different options to choose from when it comes to how they choose to arrange child support payments.
As previously an agreement can be achieved through discussions between both parents with no CMS involvement and this is now called a Family Based Arrangement. The main point to take into account with these types of arrangements is that it is the parents who decide how a child will be supported financially. Parents can come to an agreement on anything regarding financial matters relating to their child from practical care costs to buying items for school.
The other payment option on offer is called a Statutory Arrangement which is reached with the help of the CMS. This is aimed at parents who cannot agree on a suitable arrangement between themselves. Assistance from the CMS is free at the moment but this is set to change with a charge being introduced by summer 2014 and this will no doubt have a significant effect on a lot of parents trying to reach practical agreements.
There are some major changes to how the CMS will assess and collect child support. The CMS will assist parents in setting up a Maintenance Direct/Direct Pay arrangement but parents are responsible for managing it. The other change is called a Full Collection service or Collect and Pay and this is solely set up and run by the CMS.
Changes to calculating child support
One of the main changes to child support is how the amount is how it is to be calculated. Previously the paying parent´s net income, that is after tax and national insurance, was used as a base but the CMS is now using the gross income of the paying parent in it’s calculations.
Another change is that the age limit for a child in full time education is increased to 20 years.
A brief summary of the rates is as follows:
For a gross weekly income of up to £800 the rates would be 12 per cent for one child; 16 per cent for two children; and 19 per cent for three plus children.
For a gross weekly income of £800-£3,000 the rates would be nine per cent for one child; 12 per cent for two children; and 15 per cent for three plus children.
The paying parent can be eligible for deductions if they have other children living with them and if the child spends nights at their house.
Full details of all the changes affecting parents are available from the CMS.