Asked by: Alex Chalk (Conservative - Cheltenham)
Question to the Department for Work and Pensions:
To ask the Secretary of State for Work and Pensions, what procedures the Child Support Agency (CSA) has to ensure that it takes account of a person's assets as well as their income when calculating child maintenance payments; and if he will make it his policy to require the CSA to take into account the value of retained profit of any company controlled by the non-resident parent when calculating child maintenance payments from that parent.
Answered by Priti Patel - Shadow Secretary of State for Foreign, Commonwealth and Development Affairs
Across all three Child Maintenance schemes maintenance is calculated based on a person’s earned income, and does not normally include any consideration of assets.
Since 1996, clients have been able to request either that the standard maintenance calculation can be ‘departed’ or ‘varied’ (depending on which Child Maintenance scheme their case is under) in certain exceptional circumstances. These include where there is income generated from assets, such as property or dividends, which would not otherwise be taken into account.
Where a business retains profits for the purposes of ensuring continued existence and / or growth of the business, and provided the amounts retained are not unreasonable under UK taxation legislation, there is no provision to include these amounts in the calculation of a maintenance liability.