[2023] UKUT 175 (AAC)

Regulation 34 of the 2012 Regulations lays down the general rule for determining a person’s gross weekly income for the purpose of making a child support assessment. Paragraphs (1) and (2) provide –

“34.

—(1) The gross weekly income of a non-resident parent for the purposes of a calculation decision is a weekly amount determined at the effective date of the decision on the basis of either historic income or current income in accordance with this Chapter.

(2)

The non-resident parent's gross weekly income is to be based on historic income unless—

(a)

current income differs from historic income by an amount that is at least 25% of historic income; or

(b)

no historic income is available; or

(c)

the Secretary of State is unable, for whatever reason, to request or obtain the required information from HMRC.”

As the effective date in this case 9 September 2017, Income in 2016/17 or any earlier year was therefore “historic income”, and income in 2017/18 was “current income”.

Regulation 35 makes provision for determining “historic income”. Paragraph (1) provides –

“35.—(1) Historic income is determined by—

(a)

taking the HMRC figure last requested from HMRC in relation to the non-resident parent;

(b)

adjusting that figure where required in accordance with paragraph (3); and

(c)

dividing by 365 and multiplying by 7.”

Paragraph (3) is not relevant to this case. Regulation 36(1)(a) provides –

“36.

—(1) The HMRC figure is the amount identified by HMRC from information provided in a self-assessment return or under the PAYE regulations, as the sum of the income on which the non-resident parent was charged to tax for the latest available tax year—

(a)

under Part 2 of ITEPA (employment income);

…”

“Current income” is calculated on an altogether basis, presumably largely for practical reasons. Regulations 37(1) and 38(1) provide –

“37.—(1) Current income is the sum of the non-resident parent's income—

(a)

as an employee or office-holder;

(b)

from self-employment; and

(c)

from a pension,

calculated or estimated as a weekly amount at the effective date of the relevant calculation decision in accordance with regulations 38 to 42.”

“38.

—(1) The non-resident parent's current income as an employee or office-holder is income of a kind that would be taxable earnings within the meaning of section 10(2) of ITEPA ….”

As to estimation, regulation 42 provides –

“42.—(1) Where—

(a)

current income applies by virtue of regulation 34(2)(a) where the amount of historic income is nil or by virtue of regulation 34(2)(b) or (c) (historic income not available); and

(b)

the information available in relation to current income is insufficient or unreliable,

the Secretary of State may estimate that income and, in doing so, may make any assumption as to any fact.

(2)

Where the Secretary of State is satisfied that the non-resident parent is engaged in a particular occupation, whether as an employee, office-holder or self-employed person, the assumptions referred to in paragraph (1) may include an assumption that the non-resident parent has the average weekly income of a person engaged in that occupation in the UK or in any part of the UK.”