[2023] UKUT 238 (AAC)

This discussion will concentrate on the First and Fourth Interpretations of regulation 69(3).

No party has actively argued for the Third Interpretation and when I raised it as a possibility, I did so tentatively. My concluded view is that it is incompatible with the wording of regulation 69(3) which is about what is to be taken into account when determining the unearned income of a non-resident parent and not about what rules should be followed when doing so.

The Second Interpretation is attractive to a certain extent. In this case, it would have avoided the absurdity created by the First Interpretation: see paragraphs 51 – 57 above.

The facts of other cases, however, are often less clear cut. And accepting that the amount of the non-resident parent’s unearned income is to be assessed as being the figure provided by HMRC in the absence of clear evidence to the contrary is also incompatible with the actual wording of regulation 69(3), which—if the Secretary of State is not required to accept the information from HMRC in cases to which the “by reference to” test applies—provides no basis other than relevance for limiting the evidence that should be considered.

I also accept the Secretary of State’s submission that the Second Interpretation would give rise to impossible questions about whether individual items of evidence were sufficiently “clear” to be taken into account.

For example, the word does presumably does not imply that the evidence should satisfy a higher standard of proof than the usual civil standard. But if it does not mean that what does it mean?

If it means evidence that is immediately available to the Secretary of State or FTT without having to delay matters by directing its production, then that would turn important decisions about how much non-resident parents must pay to support their children into a lottery based what evidence had been produced at earlier stages of the case. A lottery, moreover, that non-resident parents would almost always win because persons with care often cannot access the relevant evidence without the assistance of the Secretary of State or the Tribunal.

I therefore also reject the Second Interpretation. Either the First or the Fourth interpretation is correct.