is it changing from net to gross?

This is new to me, so apologies if it has already been a topic, but I have just read that the CMEC rates www.nacsa.co.uk/index.php?option=com_con...id=84&Itemid=110 are going to be based on gross and not net pay,, in my case going from 20% net to 16% gross of my wage.

Just done some calculations and really don't like what I am seeing ~ it seems as though it would go from about £75/week upto £100/week.

Jesus surely this isn't going to be the case, it seems to be bad news for NRP's and i guess conversely good news for PWC's.


Anyone able to confirm ??

Yes.

I have read that calculations will change sometime during 2011.

Calculations will be based on gross income according to a scale. If you earn less than £800 per week then the percentages will be 12%, 16% and 19% for 1, 2 or 3 children. If you earn above £800 per week the calculations will be 9%, 12% and 15% for 1, 2 or 3 children.

www.familylawweek.co.uk/site.aspx?i=ed24549

It is intended that information about gross income will be collected directly from HMRC rather than self disclosure by the non-resident parent.

It is changing - there is as yet no set date for the change to take place - "sometime in 2011" , with existing cases being moved over to the new scheme so that by 2013-14 everyone will be on the new scheme.

The changes aim to close a few loopholes - under the current scheme, NRPs have been able to avoid paying where (i)they have their own business and take some or all income as dividends, or (ii) are making high payments into a pension.

The new scheme will allow some pension contributions to be taken into account, and also uses lower % for income which will be subject to tax at higher rate, so the NRP is not disadvantaged.

I'm a little confused by your figures - if you currently pay £75 p.w, at 20% that equates to weekly income of £375 net = £490 p.w. gross. 16% of £490 = £78.

£100 p.w. would be 16% of £625. Gross pay of £625 = net pay £468 (which under the current scheme would mean your liability would be £93 p.w., not £75)

The new scheme will make some allowances for pension contribtuons but these are likely to be capped to prevent NRPs from using a pension as a methofd of avoiding payments.

thanks for that Bagpuss. I will have to check my figures again, not too bothered if it is about the same.

Shame there is no reference to shared care and changing of arrangements there to represent the committment made by NRPs to bringing up the children in their time.

ok here goes.

current arrangement: My net monthly wage is £2278 so 20% is £456. then i get a 28% reduction for shared care so total payable is £328.

new arrangement: My gross monthly wage - pension contribution is £3095 so 16% is £495. Then i get a 28% reduction for shared care so total payable is £356.

I will be £28/month worse off.

I wonder how much I will be able to increase my pension contributions by. It won't mean I am any better off now but at least I am saving it in a fasion.

mmmm it will be interesting to see what they limit pension contributions by. Surely there is a maximum limit, NRPs couldn't be limited to less than the general public.......that would be outrageous!! and I imagine totally undefendable.

Gentleman I think you need a change in perspective think positive don't be negative about this: I rejoice in knowing how much happiness I will bring Bazza and the Harridan when they are able to upgrade their holiday fron the costas to the carribbean, when I babysit the kids in the summer hols
All the best
Pete xxx