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CSA v directors of limited companies

Rumbled
Posted by
Platinum Member

27 Jul 13 #402331 by Rumbled

Topic started by Rumbled

After 6 months of no financial support from my ex and constant taunts saying ''go to the CSA and you will get next to nothing'' My ex told the judge in our first financial hearing that he had contacted the CSA himself. He threw a figure into the air which placated the judge but I couldn''t see where it came from so I phoned the CSA who wouldn''t confirm that he had started a claim so I started one myself.... 6-8 week wait.

I was wondering how successful people had been challenging what NRPs had declared as their earnings. My ex pays himself a small salary, takes large drawings from his one man band limited company, and puts lots of personal expenses through his business account which any normal tax payer would pay for out of net income.

I am now armed with all of this information. How can I go about proving that this is his true income, and will the CSA accept it?

We are returning to court soon (unlikely we will come to an agreement beforehand) I gather the judge won''t set child maintenance payments.

He has the children minimum time he possibly can and another child that he pays minimum CSA payments to.

Thanks

WYSPECIAL
Moderator

27 Jul 13 #402348 by WYSPECIAL

Reply from WYSPECIAL

No CSA wont accept it.

They will only take into account his taxable income. CSA and self employed are a nightmare combination sorry.

Child Maintenance Options
Moderator

01 Aug 13 #402992 by Child Maintenance Options

Reply from Child Maintenance Options

Hi Nofool.

Thank you for your post. I am Sarah the Child Maintenance Options consultant.

I am unable to answer any specific questions about the Child Support Agency (CSA), but I have provided information below that may be of help to you.

The CSA would work out child maintenance using your ex-partner''s income, which includes earnings and money from an occupational or personal pension. They use the amount of income left after deductions such as Income Tax, National Insurance and any money paid into a personal pension scheme.

When they calculate maintenance, they would also take in to account any Child/Working Tax Credits that your ex-partner or his partner, if he has one, may receive. This is because it is classed as a household income.

The only time Working Tax Credits would not be taken into account is if the paying parent''s partner is the main earner in their household. However, Child Tax Credits are always taken into account.

You mention that your ex-partner is self-employed, in these circumstances the CSA would usually work out this average weekly earnings for the most recent tax year. If they are unable to, perhaps because he has only recently started self-employed work, they would use details of the gross income of the business; this means all the money it has earned. To work out his earnings, the CSA would take away from the gross income of the business, any reasonable expenses paid to run the business (not including capital spending or business entertainment expenses), and VAT (value added tax).

You say that your ex-partner has a limited company. This could be a help to you as the records of all such companies are in the public domain and accounts must be produced if requested. These accounts will show if he is receiving wages and dividends from the company.

If you believe that your ex-partner is not declaring all of his earnings, you could apply for a variation on the grounds that his declared income is inconsistent with his lifestyle or on the grounds of him diverting his income.

If your application for a variation were to fail, and sometimes this may happen if the CSA feel they have been given insufficient evidence on which to make a clear decision, then you have the right of appeal. If you were to exercise this right you will be able to go before a judge in an appeal tribunal to put your case before him or her. Your ex will also be required to give evidence with regard to his circumstances and sometimes it is at these tribunals that a much clearer insight is gained into lifestyle and income.

If you do have any further questions about your application to the CSA, you may wish to speak with the CSA directly. Their contact details can be found on any letter they have sent you, or this website www.gov.uk/child-support-agency provides their contact details.

If you would like more information about family-based arrangements and access to useful tools and leaflets online you can visit www.cmoptions.org, or if you would prefer a confidential chat you could call the Child Maintenance Options team on 0800 988 0988 (free from a landline).

We also have a sorting out separation web-app that you may find useful, it offers help and support to separating families. The link is: www.wikivorce.com/divorce/Sorting-Out-Separation.html

Rumbled
Posted by
Platinum Member

05 Aug 13 #403441 by Rumbled

Reply from Rumbled

Thank you Sarah, that information was quite reassuring.

My ex pays himself a minimum salary to qualify for NI and receives a pay slip to confirm this, however his bank statements do not match this amount in any shape or form. ''Salary'' is recorded and the amount paid into his account is roughly 4x his ''pay'' on average which includes dividends. His lifestyle is still supported by further payments from his company and I therefore hope that I can use his total company earnings, less corp tax etc when making the maintenance calculation.

Whenever I question my ex''s income with his solicitors they always say ''our client''s NET pay is supported by his pay slips, and is therefore correct in our opinion'' though

Just waiting for CSA now.

tedbovis
New Member

18 Jun 14 #437167 by tedbovis

Reply from tedbovis

The CSA changed their own laws on this a few years back its rather sketchy too on Director Dividends and Ltd company.

The mother who usually isn''t working and hounding her ex-husband for more and more money has one option in a situation like this she can ask for a ''Variation'' from the CSA...

However this comes with legal risks to the claiment and CSA/case workers...

The CSA under ''Variation'' would take into account everything from the NRP company (pensions, shares, dividends etc)... however this opens a load of doors in ''Company law'' making the CSA liable and the claimant liable...

It is Illegal for any company, agency or organisation to order an equivalent of a Section s793 unless they are Official ''Registrars'' managing stocks & shares in the UK.

The director/father could issue legal proceedings if full ''Disclosure'' from CSA was under taken on the Ltd company. Individual case workers for the CSA could be liable also for breaking company law and data protection laws when the Ltd has a secondary shareholder or/and employees etc.

CSA is not above the law at the end of the day. Companies are entitled to protect their investments and sensitive employee data.

Another point is a Variation order from CSA to the father running a Ltd would make said person look at custody options, thus the claimant might loose the child because the father can better support the child financially a judge would see. This happened in a court case my own solicitor took on, she lost the case so the father won.

The law is less bios against Mothers these days. So the question is do you want to loose your child over a money issue? Nope! no parent does!
Sometimes you just have to be lucky that have your child etc.

Fiona
Platinum Member

18 Jun 14 #437193 by Fiona

Reply from Fiona

Hang on a second, Parliament is the legislature and the CSA or Child Maintenance Service don''t make the law. Although it''s true the CSA/CMS are limited in the information they can request parents can appeal a CSA/CMS decision. A tribunal hearing an appeal has more powers to request information and infer a decision if enough information isn''t forthcoming.

The term ''custody'' was replaced 25 years ago and now we have Child Arrangement Orders. I suspect there was a lot more to the case than just the father being able to support the child financially. Children cases are determined according to the Welfare Checklist in s1 Children Act 1989 and financial support isn''t one of the factors.

Rumbled
Posted by
Platinum Member

18 Jun 14 #437221 by Rumbled

Reply from Rumbled

I noticed that I asked my question almost 11 months ago. To give an update, I spent 10 of those months requesting a variation order, providing the CMS with proof that the HMRC figures they were using were incorrect and appealing against every random unjustified calculation / decision that they made. I NEVER received a response in writing. My director ex decided what he thought he should pay and the CMS were just grateful he occasionally drip fed me. I have literally been on the phone daily to beg them to start enforcement action for regular monthly payments at the correct amount (whatever that might be). I was NEVER granted an appeal.

I am sure that I cannot disclose the full details of my battle but I am assured that they might have sorted something in the next 4 weeks. They must be sick of the sound of my voice!

Never give up!

Moderators: wikivorce team, rubytuesday, dukey, hadenoughnow, Tets, Forseti, Mitchum, WhiteRose, Lostboy67, WYSPECIAL, Bubblegum11

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