Barkworth and Barkworth (Child support)

[2021] AATA 3856

Barkworth and Barkworth (Child support) [2021] AATA 3856 (6 September 2021)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2021/SC021977

APPLICANT:  Mr Barkworth

OTHER PARTIES:  Child Support Registrar

Ms Barkworth

TRIBUNAL:Member P Noonan

DECISION DATE:  06 September 2021

DECISION:

The decision under review is affirmed.

CATCHWORDS

CHILD SUPPORT – particulars of the administrative assessment – whether a fixed annual rate of child support should not apply – financial resources – not unjust and inequitable for fixed annual rate to apply – application for fixed annual rate not to apply should be refused – decision under review affirmed

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been omitted from this decision and replaced with generic information so as not to identify involved individuals as required by subsections 16(2AB)-16(2AC) of the Child Support (Registration and Collection) Act 1988.

REASONS FOR DECISION

BACKGROUND

1. Mr Barkworth and Ms Barkworth are the parents of three children all of whom are currently subject to a child support assessment.

2. Mr Barkworth lodged an application for the fixed annual rate (“FAR”) of child support not to apply to the child support assessment for the period 4 November 2020 to 3 February 2022. On 8 June 2021 a delegate of the Child Support Registrar (“the Registrar”) decided not to accept Mr Barkworth’s application.

3. Mr Barkworth subsequently lodged an objection to the decision not to apply the FAR. On 22 July 2021 an objections officer decided to disallow Mr Barkworth’s objection.

4. Mr Barkworth subsequently applied to the Tribunal for review of the objections officer’s decision.

5. The Tribunal heard Mr Barkworth’s application on 6 September 2021. Both Mr Barkworth and Ms Barkworth gave evidence on affirmation. The Registrar did not participate in the hearing. The Tribunal also had before it documentation provided by the Registrar (folios 1 to 120) and further documents supplied by both Mr Barkworth (folios A1 to A118) and Ms Barkworth (folios B1 to B48).

CONSIDERATION

1. The statutory provisions relevant to this review are contained in the Child Support (Assessment) Act 1989 (the Act). The relevant provisions are summarised below.

2. Division 7, subdivision B of the Act sets out provisions relevant to annual rates of child support for low-income parents and minimum annual rates of child support.

3. The relevant legislation regarding the application of fixed and minimum rates of child support payable by a parent is contained in sections 65A, 65B and 66 of the Act. Section 65A provides, relevantly, that the Registrar must assess an annual rate of child support of a low-income parent as the rate specified in subsection 65A(2). Subsection 65A(1) relevantly requires 3 criteria to be satisfied for this to occur:

   (a)  the parent did not receive an income support payment during the last relevant year of income;

   (b)  the parent’s adjusted taxable income for the last relevant year of income was less than the parenting payment (single) maximum basic amount;

   (c)   the parent does not have at least shared care of the child during the relevant care period.

4. Section 65B allows for an application for section 65A not to apply to be made. Subsection 65B(2) states that the parent making the application must provide evidence to the Registrar to demonstrate that their income is less than the maximum parenting payment (single) rate amount and that it would be unjust and inequitable to expect them to pay the amount of child support assessed.

5. Mr Barkworth is self-employed and runs a [business]. He submitted that he is in the process of closing this business down, however, he provided no evidence the business was under administration. He submitted that he lives at the business’s factory. He has significant health concerns. He confirmed that he is not currently in receipt of any income support payments.

6. Ms Barkworth submitted that Mr Barkworth has met his personal expenses from his business expenses. She has not filed for a change of assessment at this stage but expects that, at the minimum, he be required to pay child support at the FAR.

7. The Tribunal notes that Mr Barkworth declared a personal income loss of $115,490 in the 2020/21 tax year. He declared business income of $483,784 and total business expenses of $599,275. This included depreciation of $83,984, advertising of $39,426, salary of $44,276 and travel of $51,537, amongst other claimed expenses. In addition, Mr Barkworth’s personal bank statements for the period 23 February 2021 to 23 May 2021 reflect deposits of $3,700.

8. In addition, the Tribunal notes significant and ongoing cash withdrawals from the business bank account and expenditure of a personal nature during 2021.

9. Turning to the criteria set out at subsection 65A(1), the Tribunal finds that Mr Barkworth did not receive an income support payment during the last relevant year of income. The Tribunal finds that Mr Barkworth’s adjusted taxable income for the last relevant year of income, being the 2018-19 income year (-$127,809) was less than the parenting payment (single) maximum basic amount and he does not have at least shared care of the children. Therefore, unless the criteria set out at section 65B are met, the decision to apply the FAR to Mr Barkworth is correct.

10. The evidence before the Tribunal clearly reflects that Mr Barkworth has access to financial resources through the operation of his business such that it is not an unjust and inequitable outcome to require him to pay child support at the FAR.

11. Accordingly, the Tribunal is satisfied that section 65B should not apply in this instance and section 65A applies. As such, the decision to refuse Mr Barkworth’s application for the FAR not to apply is correct. 

DECISION

The decision under review is affirmed.