Adjusting Child Maintenance: Applying for a Variation

Life is dynamic, and financial circumstances can change dramatically over time. When child maintenance payments are initially calculated, they provide a crucial framework for supporting your child. However, these calculations are based on a snapshot in time. What happens when your income streams diversify, or you incur significant, regular expenses directly related to child contact or the unique needs of a child? The Child Maintenance Service (CMS) recognises this, offering a mechanism known as a 'variation' to ensure that child maintenance payments remain as fair and accurate as possible.

A variation allows the CMS to consider aspects of your financial situation that might not be captured in the standard calculation. This could include various forms of income and assets, or specific types of expenses. It's an essential tool for both paying and receiving parents to ensure the financial arrangements genuinely reflect everyone's current circumstances, promoting fairness and transparency in the process.

Understanding What a Variation Is

Simply put, a variation is an application to the Child Maintenance Service to take additional income, assets, or specific expenses into account when determining the amount of child maintenance. The standard CMS calculation primarily focuses on the paying parent's gross weekly income from employment or self-employment. However, this doesn't always paint the full picture of a parent's financial capacity or the genuine costs involved in supporting a child.

You have the flexibility to request a variation at two key stages: either when you first apply for child maintenance, or at any point after your child maintenance amount has been calculated and is already in effect. This flexibility ensures that the system can adapt to evolving financial realities, whether due to new investments, changes in living arrangements, or unexpected but ongoing costs.

The Timeline for a Variation Application

It's important to manage your expectations regarding the processing time for a variation. Once you submit your application for a variation, it can take up to three months for your child maintenance payment amount to be adjusted. This period allows the CMS to thoroughly assess the new information, gather any necessary evidence, and recalculate the payments accurately. Patience during this period is key, as a thorough review ensures the correct outcome.

Income and Assets: What Can Be Included?

Both the paying parent and the receiving parent have the right to ask for certain types of income and assets to be factored into the child maintenance calculation through a variation. This ensures that the assessment considers a broader spectrum of financial resources available to either parent, leading to a more comprehensive and equitable outcome. The types of income and assets that can trigger a variation include:

• Rental Income: If a parent receives rental income that exceeds £2,500 per year, this can be considered. This accounts for significant passive income from property that contributes to a parent's overall financial capacity.
• Interest and Dividends: Any interest earned from savings or dividends from investments, provided these amounts are over £2,500 per year, can also be included. This ensures that substantial returns from financial assets are not overlooked.
• Gross Earnings or Pension for Flat Rate Payers: For paying parents who receive benefits and qualify to pay the 'flat rate' of child maintenance, any gross earnings or pension of at least £100 a week can be taken into account. This is particularly relevant for those on lower incomes or benefits, where even a modest additional income can impact the flat rate calculation.
• Diverted Income: This is a crucial category designed to prevent parents from intentionally reducing their declared income to lower child maintenance payments. If there's evidence that the paying parent is diverting income so that it isn't included in the standard calculation – for example, giving it to someone else, or choosing to receive a company car instead of a higher salary – this income can be added back into the calculation. This upholds the principle that child maintenance should be based on a parent's true earning capacity.
• Assets: Significant assets, such as shares, stocks, gold, or substantial amounts of money, that are worth more than £31,250 can also be considered. This ensures that a parent with considerable wealth held in non-income-generating assets still contributes appropriately to their child's upbringing.

By considering these additional income and asset streams, the CMS aims to ensure that the child maintenance calculation reflects a more complete picture of a parent's financial standing, beyond just their primary employment income.

Table: Income and Assets Considered for Variation

Expenses: What Can Be Included (Paying Parent Only)?

While income and assets are considered from both parents, certain expenses can only be taken into account if you are the paying parent. These are specific costs that, if significant and ongoing, can impact your ability to pay child maintenance. The CMS allows these expenses to be considered to ensure the calculation remains realistic for the paying parent. Each type of expense must typically be more than £10 a week to be considered, with one notable exception.

The types of expenses that can be taken into account include:

• Costs of Regular Contact: This covers the expenses involved in maintaining regular contact with a child for whom you pay maintenance. A common example provided is the cost of fuel to travel between your home and the child's home. These are direct, unavoidable costs of fulfilling parental responsibilities.
• Costs of Supporting a Disabled or Ill Child: If you live with and support a child with a disability or a long-term illness, the associated costs can be taken into account. This is the exception to the £10 a week rule; these costs can be less than £10 a week and still be considered, recognising the often significant and varied expenses associated with such care.
• Repaying Debts from a Previous Relationship: If you are repaying debts that originated from a previous relationship with the receiving parent, these can be considered. This helps to alleviate the financial burden of historical joint liabilities that are now solely your responsibility.
• Boarding School Fees: If you pay for a child's boarding school fees for a child you pay maintenance for, the boarding part of those fees can be considered. This acknowledges your direct financial contribution to a significant educational expense.
• Mortgage, Loan, or Insurance Payments for a Former Shared Home: If you are still making mortgage, loan, or insurance payments for the home you used to share with the receiving parent, and the receiving parent and your child still live there, these payments can be considered. This accounts for ongoing financial obligations tied to the former family home.

It is crucial to remember that each of these expense types, with the exception of costs for a disabled or long-term ill child, must typically exceed £10 per week to be eligible for consideration. Furthermore, if your gross income is less than £7 a week, you cannot apply for these expenses to be taken into account. This threshold ensures that the variation process focuses on situations where there's a more substantial financial capacity to be adjusted.

Table: Expenses Considered for Variation (Paying Parent Only)

How to Apply for a Variation

The process for applying for a variation is straightforward: you need to directly contact the Child Maintenance Service. They will guide you through the necessary steps, explain what information and evidence you will need to provide, and initiate the assessment process. It's advisable to have all relevant financial documents ready to support your claim, whether it pertains to additional income, assets, or eligible expenses.

Key Considerations When Applying for a Variation

Applying for a variation is about ensuring the child maintenance calculation is as accurate as possible. Here are some key points to bear in mind:

• Evidence is Paramount: Any claim for additional income, assets, or expenses must be supported by verifiable evidence. This could include bank statements, payslips, rental agreements, investment statements, travel logs, or debt repayment schedules. The more comprehensive and clear your evidence, the smoother the process will be.
• Understanding Thresholds: Be mindful of the specific financial thresholds for income, assets, and expenses. If your situation doesn't meet these criteria, a variation may not be applicable for that particular item.
• Impact on Payments: A variation can result in either an increase or a decrease in child maintenance payments, depending on the specifics of the case. The goal is to achieve a more accurate and fair payment amount.
• Communication with CMS: Maintain open communication with the Child Maintenance Service throughout the process. Respond promptly to any requests for information to avoid delays.

Frequently Asked Questions About Variations

Navigating child maintenance can be complex, and variations add another layer. Here are some common questions parents often have:

Q: How long does it typically take for a variation application to be processed?

A: Once you apply for a variation, it can take up to three months for your child maintenance payment amount to change. This allows the CMS sufficient time to gather and assess all necessary information.

Q: Can both the paying and receiving parent apply for variations based on income and assets?

A: Yes, both the paying and receiving parent can ask for specific types of income and assets (such as rental income, interest/dividends, certain gross earnings/pensions, diverted income, and high-value assets) to be taken into account.

Q: Are expense variations available to both parents?

A: No, expense variations (such as costs for regular contact, supporting a disabled child, previous relationship debts, boarding school fees, or former shared home payments) can only be requested by the paying parent.

Q: What is the minimum amount an expense must be for it to be considered for a variation?

A: Generally, each type of expense must be more than £10 a week to be considered. The only exception to this rule is the costs of supporting a child with a disability or long-term illness who lives with you; these costs can be less than £10 a week.

Q: Can I apply for expenses if my gross income is very low?

A: No, if your gross income is less than £7 a week, you cannot ask for expenses to be taken into account for a variation.

Q: What exactly is meant by 'diverted income'?

A: Diverted income refers to any income the paying parent may be intentionally redirecting so that it is not included in the standard child maintenance calculation. Examples include giving money to someone else or choosing to receive a company car instead of a higher salary.

Q: Are all assets considered for a variation?

A: No, only specific types of assets that are worth more than £31,250 are considered. These include assets like shares, stocks, gold, or significant amounts of money.

Q: What kind of 'costs of keeping in regular contact' can be included?

A: This typically refers to direct costs associated with facilitating contact, such as the fuel consumed to travel between your home and the child's home to pick them up or drop them off.

Q: Can I include all my personal debts as an expense variation?

A: No, only debts specifically from a previous relationship with the receiving parent can be considered as an expense for a variation, provided they meet the £10 a week threshold.

By understanding the criteria and process for applying for a variation, parents can ensure that their child maintenance arrangements accurately reflect their current financial situations, leading to a more equitable and sustainable support system for the child.

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