Question to the Department for Work and Pensions:

To ask the Secretary of State for Work and Pensions, what information is shared between CMS and HMRC when a parent that owes child support is self employed.

The Child Maintenance Service (CMS) requests information from HM Revenue and Customs (HMRC) in relation to all child maintenance cases, including where a paying parent is self-employed.

For paying parents, HMRC provides CMS with details of their total taxable earned income, including income from employment and self-employment, based on the most recently available complete tax year.

In line with child maintenance legislation, this information is used to determine the initial maintenance calculation and is updated annually as part of the Annual Review process. Where a paying parent’s current income differs by more than 25% from the historic income figure provided by HMRC, CMS can consider evidence of current income.

Where CMS is made aware, through a variation application, that a paying parent receives unearned income, CMS can request relevant information from HMRC so that this can be taken into account when calculating child maintenance.

CMS also receives other information from HMRC that is relevant to the administration of child maintenance cases. This includes information used to verify qualifying children and relevant other children, and to identify changes that may affect their qualifying status, such as the cessation of Child Benefit entitlement.

It should be noted that CMS has an automated system interface with HMRC through which this information is obtained. This is not a two-way exchange of case information. CMS provides HMRC with the basic personal information necessary to identify the relevant individual, enabling HMRC to return the requested information to CMS.

CMS has recently begun joint partnership working with HMRC on some of its most serious cases, including undeclared self-employed income. Through working with tax specialists to risk-assess potential cases, CMS will strengthen its understanding of tax arrangements, improve intelligence sharing and support a more rounded understanding of customer behaviours.