Car allowance

My ex husband and I have our own agreement at the moment but my maintenance will reduce from October when our eldest daughter starts uni. He''d will only be paying maintenance for our youngest who is 8. The bug bear at the moment is his car allowance. It is added to his basic salary on his wage slip to give a gross figure. He then pays tax on this figure. CM service have said anything taxable is treat as income. My ex however says he has rung them and they''ve said it isn''t??
I am going to do an application to get the correct figure calculated but just wondered if anyone here would know the answer.
Many thanks
Bulldog

Bulldog the HMRC treat car allowances an income it is subject to being used as income for CMS purposes I believe.


Another point to consider in relation to your eldest child is that they could make an application to the court for maintennace for themselves whilst they go through university.

My Consent Order (to save future costs) was written to pay child support allowing for a gap year for both my children to achieve there first degree. Its worth considering pursing this if it wont cause animosity.

Its my understanding that some of a car allowance wont be considered income, it will depend upon whether the car is a ''perk'' or if its needed to complete the job.

If ex job is based in a car and he does a lot of business travel, then probably all of it wont be taxable so not income, however if the car sits in a car park all day and isn''t used for business use then it considered a ''perk'' all of the allowance would be taxable so therefore income.

Who did your ex speak to? If it was the CSA there may be some confusion. They operate with a different set of rules and child maintenance is assessed as a percentage of the paying parents *net* income.

The Child Maintenance Service now handles all new applications. Under the 2012 rules child maintenance is calculated as a percentage of *gross* income and normally only pension contributions can be deducted before the calculation.

Gross income will include any of the car allowance that is taxable. The ''untaxable'' part of the car allowance wont show up, so can''t be included as income.

Do you have a copy of his p60?

I suspect he''s contacted the wrong service. I rang child maintenance service this afternoon and they said if it''s taxable it counts as income. The car salary is added to his basic salary on his wage slip to give a gross monthly amount which then all of it is then taxed. It will be worth paying the £20 to get a figure calculated and they will then write to him to tell him how much he should be paying

You might need his P60 rather than a wage slip to work out cm.

Also if you currently have a case open under the ''old'' scheme then it will still be worked out using the ''net'' formula. Not sure when old cases will be moving over to the new one.