New vs Old CSA

As this will be a new application and there are two or more children it will be handled by the child maintenance Service and based on the new gross income scheme. The general rule is that the paying parent''s gross income is to be based on their historic income unless current income differs by an amount that is at least 25% of historic income, the amount of historic income is nil or no historic income is available. In these cases the calculation is based on current income and r39 Child Support Calculation Regulations 2012 sets out how current income from self-employment is to be determined;

(1) The non-resident parent’s current income from self-employment is to be determined by reference to the profits of any trade, profession or vocation carried on by the non-resident parent at the effective date of the relevant calculation decision.

(2) The profits referred to in paragraph (1) are the profits determined in accordance with Part 2 of ITTOIA for the most recently completed relevant period or, if no such period has been completed, the estimated profits for the current relevant period.

(3) The weekly amount is calculated by dividing the amount of those profits by the number of weeks in the relevant period.

(4) In paragraphs (2) and (3) the “relevant period” means a tax year or such other period in respect of which the non-resident parent should, in the normal course of events, report the profits or losses of the trade, profession or vocation in question to HMRC in a self-assessment return.

(5) In the case of a non-resident parent who carries on a trade, profession or vocation in partnership, the profits referred to in this regulation are the profits attributable to the non-resident parent’s share of the partnership.

(6) The profits of a trade, profession or vocation that the non-resident parent has ceased to carry on at the effective date of the relevant calculation decision are to be taken as nil.

The variation rules remain much the same as before. Paying parents can apply for a variation if they pay special expenses e.g. contact costs, debts from a prior relationship.

Charges for applications and collection s are to be introduced later.