Blythe and Blythe (Child support)

[2018] AATA 1708

Blythe and Blythe (Child support) [2018] AATA 1708 (24 April 2018)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2017/CC012489

APPLICANT:  Mr Blythe

OTHER PARTIES:  Child Support Registrar

Ms Blythe

TRIBUNAL:Member W Kennedy

DECISION DATE:  24 April 2018

DECISION:

The Tribunal sets aside the decision under review and, in substitution, decides to vary Ms Blythe’s adjusted taxable income to $94,640.00 for the period from 27 January 2017 to 31 December 2019.

CATCHWORDS

Child Support – Departure determination – Income and financial resources of parents – Period of departure - Decision under review set aside and substituted

Names used in all published decisions are pseudonyms. Any references appearing in square brackets indicate that information has been removed 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. This decision concerns an application for a departure from the formula assessment of child support.  Mr Blythe and Ms Blythe are the parents of [Child 1], who was born in 2006, [Child 2], who was born in 2009, and [Child 3], who was born in 2013.  There has been a child support assessment in place for the children made by the Child Support Agency of the Department of Human Services (the Department) since 27 February 2015.  Mr Blythe is the parent liable to pay child support.

2. At the time that Mr Blythe applied to the Department the annual rate of child support payable by Mr Blythe was $33,917.00 based on an adjusted taxable income (ATI) of $209,575.00 for Mr Blythe and an ATI of $7,311.00 for Ms Blythe.  Both ATIs were derived from the parents’ 2015/16 income tax returns.

3. On 27 January 2017 Mr Blythe applied to the Department for a departure from the formula assessment of child support based on Reasons 8A and 8B (the income, property and financial resources and the earning capacity of one or both of the parents).

4. On 29 May 2017 a delegate of the Child Support Registrar considered the departure application and decided that Reason 8A had been established and set Ms Blythe’s ATI at $62,500.00 for the period from 27 January 2017 to 31 December 2018.

5. On 23 June 2017 Ms Blythe lodged an objection to that decision.  On 21 August 2017 a Department objections officer allowed Ms Blythe’s objection, finding that no reason had been established to depart from the administrative assessment.  As a result the decision of 29 May 2017 was set aside and the assessment of child support reverted to the formula.

6. On 11 September 2017 Mr Blythe lodged an application for a review of the decision of the Department with the Tribunal.  The Tribunal had access to the statement and documents provided by the Department.  The documents are at folios 1 to 232 of the hearing papers and were provided to the parents in advance of the hearing. 

7. Before the hearing the Tribunal directed Mr Blythe and Ms Blythe to provide specified documents.  Mr Blythe complied with the directions and his documents are at folios A1 to A90 of the hearing papers.  Ms Blythe partially complied with the directions and her documents are at folios B1 to B48 of the hearing papers.  The matter was heard and determined in [a particular city] on 24 April 2018.  Mr Blythe and Ms Blythe both attended the hearing by telephone and gave their oral evidence under affirmations.  The Child Support Registrar was not represented at the hearing.

CONSIDERATION

The legislative framework and issues for the Tribunal to determine

1. Prior to the hearing Ms Blythe requested that the Tribunal consider whether it had jurisdiction in light of a Binding Child Support Agreement between the parents made on 29 December 2013. The agreement in question states that in respect of periodic sums to be paid in child support the agreement terminates on 28 February 2015 and that from that time child support shall be determined “as per Child Support Assessment that issues from time to time by the Child Support Agency.” There has been a child support assessment made by the Child Support Agency since that time. The Tribunal finds that it has jurisdiction under section 25 of the Administrative Appeals Tribunal Act 1975 and section 89 of the Child Support (Registration and Collection) Act 1988.

2. The rate of child support payable by a liable parent is usually based on an administrative assessment under Part 5 of the Child Support (Assessment) Act 1989 (the Act).  This requires the application of a statutory formula which takes into account factors such as the number and ages of the children, the level of care provided and the income of each parent.

3. The liable parent or a carer may apply to the Child Support Registrar for a determination to depart from the child support administrative assessment under Part 6A of the Act.  Section 98C of the Act provides that the Registrar may make a determination to depart from the formula assessment and establishes a three step process for considering applications to do so.  The Registrar, and the Tribunal standing in place of the Registrar, must be satisfied:

   ·     that one, or more than one, of the grounds for departure referred to in subsection 117(2) of the Act exists; and

   ·     that it would be just and equitable as regards the child, the liable parent, and the carer entitled to child support; and

   ·     that it would be otherwise proper to make a particular determination

4. The grounds for departure from the administrative assessment are set out in subsection 117(2) of the Act.  Each of the grounds, which for administrative purposes are referred to as reasons, require that special circumstances be established.  The term ‘special circumstances’ is not defined in the Act.  In Gyselman v Gyselman [1992] FLC 92-279 the Full Court of the Family Court indicated that for there to be special circumstances, the facts of the case must establish something which is special or out of the ordinary.

5. If satisfied that a ground or grounds exist and that it would be just and equitable and otherwise proper to make a particular determination, the Tribunal must make one of the determinations prescribed in section 98S of the Act.  These include varying the annual rate of child support payable or a parent’s adjusted taxable income.

Issue one – Does a ground exist to depart from the administrative assessment?

1. The Tribunal’s first task is to determine whether a ground for departure from the administrative assessment can be established.  In his application to the Department Mr Blythe asserted that there are two grounds (or reasons) for a departure from the administrative assessment, being Reason 8A (the income, property and financial resources of one or both parents) and Reason 8B (the earning capacity of one or both parents).  The Tribunal considered each of these in turn.

Does a ground exist to depart from the administrative assessment under Reason 8A?

1. Mr Blythe sought a departure from the administrative assessment on the grounds that Ms Blythe’s income, property and financial resources are greater than is reflected in the ATI used for her in the child support assessment in effect at the time of his application.  This ground for departure, which is known as Reason 8A for administrative purposes, is set out at subparagraph 117(2)(c)(ia) of the Act:

   (c)that, in the special circumstances of the case, application in relation to the child of the provisions of this Act relating to administrative assessment of child support would result in an unjust and inequitable determination of the level of financial support to be provided by the liable parent for the child:

   (ia)   because of the income, property and financial resources of either parent; or

2. At the hearing Mr Blythe said that Ms Blythe owns a number of properties and has a lifestyle that is not consistent with the ATI used in the assessment.  At the hearing Ms Blythe said that her tax return adequately demonstrated her income.  She said that she now lives with her parents but acknowledged that she owns two properties:

   ·     An apartment in Neutral Bay, in Sydney, that she rents for $3,900.00 per month;

   ·     An apartment in Campbell, in Canberra, that she rents on AirbNb and that realises between $2,500.00 and $2,800.00 per month.

3. At the hearing Ms Blythe said that she had sold a house in Amaroo, in Canberra, in May 2017.  She said that she that it had sold for “about” $450,000.00 and that it had a mortgage of $200,000.00.  Ms Blythe said that she used the proceeds to renovate the apartment in Campbell and to pay arrears on her mortgages.

4. Following a telephone directions hearing, on 13 February 2018 Ms Blythe was directed as follows:

   Ms Blythe must provide the following evidence to the AAT by the close of business on 2 March 2018:

   ·Income Tax Return for 2015/16

   ·Statements for all bank accounts which Ms Blythe is authorised to use for the period from 1 July 2017 to 31 December 2017

   ·Statements for all credit/debit card accounts which Ms Blythe is authorised to use for the period from 1 July 2017 to 31 December 2017

   ·

5. The parties were advised at the directions hearing that in providing documentation they were to make no redactions other than specified identifying numbers.  The Tribunal’s written directions advised the parties that “the AAT may draw adverse inferences against a party if that party fails to comply with a direction to give information or evidence to the AAT.”

6. In addition to the Statement of Financial Circumstances (SOFC) that Ms Blythe had provided prior to the directions hearing, Ms Blythe has provided the following documentation:

   ·     Income tax return for 2015/16 (folios B2 to B17)

   ·     [Bank 1] Mortgage Accounts …503 for 20 May 2017 to 21 November 2017 (folios B18 to B19), …6114 for 20 May 2017 to 21 November 2017 (folios B20 to B21) and …4800 for 22 March 2017 to 21 September 2017 (folios B22 to B23)

   ·     Bank Account …1076 and …4030 balance at 1 March 2018 (folios B24 to B25)

   ·     Bank Account …1076 list of selected transactions (folio B26)

7. Ms Blythe has also provided some other documentation which does not appear to be relevant to the matter before the Tribunal.

8. Ms Blythe’s SOFC is undated and unsigned however at the hearing Ms Blythe said that the information in the SOFC was correct and that she simply overlooked signing the document.  In her SOFC Ms Blythe states that her weekly income is derived from employment ($350.00), rent ($1,400.00), child support ($510.00) and family tax benefit (FTB) ($33.00).  Thus Ms Blythe’s weekly income totals $2,293.00.  The figures for income in her SOFC are consistent with the figures disclosed in her 2015/16 tax return (folios B2 to B17).  In her SOFC Ms Blythe identifies weekly expenditure of $3,089.00, producing a weekly deficit of $796.00. 

9. Chief amongst Ms Blythe’s expenses are mortgages ($650.00), groceries ($350.00) and education ($223.00).  The mortgage expenses are confirmed by the mortgage accounts provided by Ms Blythe (folios B18 to B23), although the Tribunal notes that this figure accounts for interest only and that no capital repayment component is included.  Some of the expenses seem high but not beyond reason.  At the hearing Ms Blythe said that some of her expenses were now lower than was shown in the SOFC.  She said that her electricity bill was from when she lived in [elsewhere], but that she now lives at her parents’ home and her electricity contribution is lower.  She confirmed that her relatively high medical and education costs are accurate.

10. In response to the Tribunal’s directions that she provide bank and credit card statements for the period from 1 July 2017 to 31 December 2017 Ms Blythe has provided only heavily redacted extracts for two bank accounts showing no more than the balance in those accounts at 1 March 2018 (folios B24 to B25).  Ms Blythe has provided no bank account statements and no credit card statements.  At the hearing Ms Blythe said that she had made a considered decision to not fully respond to the Tribunal’s directions and to accept that this could result in the Tribunal making an adverse inference.  She said that she made this decision because she was concerned about the repercussions revealing information to Mr Blythe.

11. At the directions hearing Ms Blythe was asked if she would have any difficulty providing the required documents and responded that it would create no difficulty for her.  At the hearing Ms Blythe explained that when she responded at the directions hearing she was only responding in the technical sense.  She said that she only meant that it would not be difficult for her to obtain the documents not that she was willing to provide them to the Tribunal.  She later advised the Tribunal registry that she did not wish to provide bank statements and was advised of the potential consequences of failing to respond to the Tribunal’s directions.

12. In Humphries & Berry (2008) FMCAfam 409 Federal Magistrate Slack dealt with the issue of the disclosure of financial information in matters before the Tribunal.  His Honour stated that the principle of full and frank disclosure applicable to proceedings in the Family Court was also applicable to proceedings before the then Social Security Appeals Tribunal.  His Honour stated as follows at paragraph 26 and 27:

    Although the SSAT has the power to obtain information (s.103K) and the power to require the Child Support Registrar to exercise powers under the Assessment Act and the Child Support Registration and Collection Act for the purposes of gaining information relevant to a review (s.103L), there nevertheless remains a primary duty and obligation on the parties to the review to make a full and complete disclosure of their financial affairs relevant to the matter before the hearing and a duty to assist the Tribunal to come to its determination in the application. The obligation to disclose information and documents extends to the presentation of that material in a way that the true nature of their financial affairs can be readily understood. The obligation extends not just to providing financial records but also includes presenting the information in a way that can be reasonably and readily understood and examined”

13. His Honour stated as follows at paragraph 31:          

    In financial proceedings under the Family Law Act, the authorities make it clear that a Court should not be unduly cautious about making findings in favour of the other party if it is not satisfied that proper disclosure has been made (see Chang & Su (2002) FLC93- 117). Such principles, in my consideration, have similar application to these matters before the SSAT.

14. In this case Ms Blythe has failed to fully respond to the Tribunal’s directions with the result that the Tribunal does not have before it the documentation deemed necessary for it to make a fully informed decision.  While the Tribunal is able to make adverse findings on the basis of the party’s failure it cannot make such findings based on no evidence.  However Ms Blythe has provided an SOFC which details her expenditure.  She has also provided some documentation in the form of her 2015/16 income tax return and some mortgage statements, some of which supports the information contained in the SOFC and none of which contradicts that information.

15. Ms Blythe’s SOFC shows that her weekly expenditure totals $3,089.00 and that there are no other income earners in the household.  As Ms Blythe must provide all of the income to fund this expenditure the Tribunal may conclude that she has access to financial resources equivalent to this amount.  From the weekly figure of $3,089.00 the Tribunal deducts child support of $510.00 per week and FTB of $33.00 per week.  In order to meet her weekly expenditure Ms Blythe must have access to the remaining amount, which is $2,546.00.  This equates to an annual amount of $132,392.00.  Grossing this up for income tax produces a figure of $199,370.00.  As the child support assessment is based on a taxable figure the Tribunal could find it appropriate to determine that Ms Blythe’s financial resources equate to this figure.

16. Of course this ignores the manner in which Ms Blythe has organised her finances.  She has taken advantage of Australia’s peculiar personal taxation regime to maximise her assets and debts and at the same time to minimise her taxable income.  This means that while Ms Blythe is asset rich she is relatively income poor.  It is this arrangement of her financial affairs that has prompted Mr Blythe’s application.  Under the formula assessment an ATI of $7,311.00 is used for Ms Blythe, which is below the self-support amount.  Mr Blythe has previously stated that despite an ATI below the self-support amount Ms Blythe provides the children with extravagant presents and that she travels often.  The Tribunal notes that the telephone directions hearing had to be rescheduled because Ms Blythe was on a cruise at the scheduled time.  In her SOFC Ms Blythe stated that she had bank balances of $21,526.00 and a vehicle valued at $16,000.00.  On the other hand she also stated that she had credit card debts of $14,519.00 and a car loan of $14,000.00.

17. Because Ms Blythe has not fully responded to the Tribunal’s directions it has considerable difficulty establishing the true nature of her financial circumstances.  The Tribunal finds that the figure of $199,370.00 per annum does not properly represent Ms Blythe’s financial resources but is also finds that the figure of $7,311.00 does not properly represent Ms Blythe’s financial resources.  Taking into account all of the evidence before it the Tribunal finds that a figure of $70,000.00 per annum is a fair representation of the financial resources available to Ms Blythe.  This is based on an appreciation of Ms Blythe’s living expenses as detailed by her in her SOFC and also on an appreciation of her particular distribution of assets.  Grossing this up for income tax produces a figure of $94,640.00.

18. The Tribunal finds that the very substantial difference between the ATI used in the assessment and Ms Blythe’s actual financial resources is a special circumstance that makes the formula assessment unjust and inequitable.  The Tribunal finds that a ground for departure from the formula assessment of child support under subparagraph 117(2)(c)(ia) of the Act is established.

Does a ground exist to depart from the administrative assessment under Reason 8B?

1. Mr Blythe sought a departure from the administrative assessment on the ground that Ms Blythe’s earning capacity is not reflected in the formula assessment.  This ground, known as Reason 8B for administrative purposes, is set out in subparagraph 117(2)(c)(ib) of the Act:

   (c)that, in the special circumstances of the case, application in relation to the child of the provisions of this Act relating to administrative assessment of child support would result in an unjust and inequitable determination of the level of financial support to be provided by the liable parent for the child:

   …

   (ib)   because of the earning capacity of either parent; or

1. Subsection 117(7B) of the Act provides:

   (7B)In having regard to the earning capacity of a parent of the child, the court may determine that the parent's earning capacity is greater than is reflected in his or her income for the purposes of this Act only if the court is satisfied that:

   (a)    one or more of the following applies:

   (i)the parent does not work despite ample opportunity to do so;

   (ii)the parent has reduced the number of hours per week of his or her employment or other work below the normal number of hours per week that constitutes full-time work for the occupation or industry in which the parent is employed or otherwise engaged;

   (iii)the parent has changed his or her occupation, industry or working pattern; and

   (b)    the parent's decision not to work, to reduce the number of hours, or to change his or her occupation, industry or working pattern, is not justified on the basis of:

   (i)the parent's caring responsibilities; or

   (ii)the parent's state of health; and

   (c)the parent has not demonstrated that it was not a major purpose of that decision to affect the administrative assessment of child support in relation to the child.

1. At the hearing Mr Blythe said that he felt that Ms Blythe’s employment history suggested that she had manipulated her employment in order to reduce her ATI.  At the hearing Ms Blythe said that prior to the separation she had only worked part-time and that she continued to work part-time.  At the hearing Ms Blythe quoted earnings figures to demonstrate her work history.  These figures were not challenged by Mr Blythe.  Ms Blythe said that her youngest child had only started pre-school in February 2018.  The Tribunal finds that Ms Blythe continues to work and that she has not changed her employment pattern.  As a result paragraph 117(7B)(a) is not satisfied and the Tribunal is unable to make a decision to depart from the formula assessment of child support under subparagraph 117(2)(c)(ib) of the Act.

Issue two – Would departure from the administrative assessment be just and equitable?

Relevant law and evidence

1. As the Tribunal is satisfied that there is a ground to depart from the administrative assessment of child support under Reason 8A, the next step is to consider whether it is just and equitable to depart from the assessment.  In deciding whether it is just and equitable the Tribunal had regard to the following matters set out in subsection 117(4) of the Act:

   (4)  In determining whether it would be just and equitable as regards the child, the carer entitled to child support and the liable parent to make a particular order under this Division, the court must have regard to:

   (a)    the nature of the duty of a parent to maintain a child (as stated in section 3); and

   (b)    the proper needs of the child; and

   (c)    the income, earning capacity, property and financial resources of the child; and

   (d)    the income, property and financial resources of each parent who is a party to the proceeding; and

   (da)  the earning capacity of each parent who is a party to the proceeding; and

   (e)    the commitments of each parent who is a party to the proceeding that are necessary to enable the parent to support:

   (i)himself or herself; or

   (ii)  any other child or another person that the person has a duty to maintain; and

   (f)     the direct and indirect costs incurred by the carer entitled to child support in providing care for the child; and

   (g)    any hardship that would be caused:

   (i)      to:

   (A)  the child; or

   (B)  the carer entitled to child support;

   by the making of, or the refusal to make, the order; and

   (ii)       to:

   (A)  the liable parent; or

   (B)  any other child or another person that the liable parent has a duty to support;

   by the making of, or the refusal to make, the order; and

   (iii)  to any resident child of the parent (see subsection (10) by the making of, or the refusal to make, the order.

2. The Tribunal considered the evidence provided by both parents, including the documents and SOFC form that each party provided to the Tribunal, as well as the documents provided by the Department.

Assessment of evidence, findings of fact and application of the law

1. Section 3 of the Act states that it is the duty of both parents to financially support their children and that they should receive a proper amount of financial support from their parents in accordance with their capacity to contribute.

The children’s needs

1. Paragraph 117(4)(b) of the Act requires the Tribunal to consider the proper needs of the children.  The Tribunal has done this in accordance with the legislation under which this determination is made.  At the hearing the parties agreed that the children have no special needs that are out of the ordinary.  The Tribunal concludes that the children do not have special needs or extraordinary costs that need to be taken into account by the Tribunal.

The children’s incomes and earning capacities

1. The children have no independent income or earning capacity that needs to be taken into account in the assessment.

The income, property and financial resources and earning capacity of Mr Blythe and his necessary commitments

1. Mr Blythe’s income, property and financial resources, as well as his earning capacity were closely examined by the Tribunal.  In addition to the SOFC which Mr Blythe provided prior to the telephone directions hearing, Mr Blythe has also provided:

   ·Income Tax Return for  2016/2017 (folios A6 to A11)

   ·[Bank 2] A/c …5606 statements for 1 July 17 to 31 December 2017 (folios A12 to A38)

   ·[Bank 3] A/c …6796 statements for 1 May 2017 to 25 January 2018 (folios A60-A81)

   ·[Bank 3] credit card account …6411 statements for 16 June 2017 to 15 January 2018 (folios A39 to folio A59)

2. The Tribunal examined Mr Blythe’s SOFC (folios A82 to A90).  Mr Blythe states that his weekly income is $4,619.00, consisting of wages of $4,559.00 and child care rebate of $60.00.  The wage figure is consistent with Mr Blythe’s income tax return (folio A7).  Mr Blythe reports weekly expenses of $4,793.00, with the result that his expenditure exceeds his income by $174.00 per week.  Chief amongst his expenses are income tax of $1,941.00, which is confirmed by his income tax return, rent ($682.00), child support ($652.00) and food ($350.00).  Some of Mr Blythe’s reported expenses seem unusually high, however at the hearing Mr Blythe asserted that the numbers were correct.  With regard to rent Mr Blythe’s bank statements show that he pays rent of $2,350.00 to his partner, who then pays the rent directly.  This equates to a contribution of $542.00 per week, rather than the $682.00 shown in the SOFC.

3. Mr Blythe’s 2016/17 tax return shows that he earned $267,507.00 and that he claimed deductions of $30,438.00.  The bank account statements provided by Mr Blythe are consistent with these figures.  The Tribunal is satisfied that the documents provided by Mr Blythe accurately demonstrate his financial circumstances.  The Tribunal finds no evidence of undisclosed income or other financial resources that need to be taken into account in the child support assessment.

4. Although Mr Blythe has a very high income his SOFC shows that his expenditure is equally high.  At the hearing Mr Blythe said that his spouse, who also has a relatively high income, contributes to the household expenses.  The Tribunal finds that Mr Blythe has somewhat overestimated his expenses and that his financial circumstances are somewhat better than he has portrayed.  For instance Mr Blythe has disclosed in his SOFC a share portfolio valued at over $100,000.00.  The Tribunal is satisfied that Mr Blythe has sufficient financial resources to meet his necessary commitments.

The income, property and financial resources and earning capacity of Ms Blythe and her necessary commitments

1. Ms Blythe’s income, property and financial resources, as well as her earning capacity were closely examined by the Tribunal.  The results are described above.  On the basis of the documentation, and in particular the SOFC, provided by Ms Blythe the Tribunal has found that Ms Blythe has access to financial resources of some $94,640.00 per annum.  The Tribunal is aware that this conclusion is not based on primary evidence but rather only on information provided by Ms Blythe.  After careful consideration of the evidence before it the Tribunal has concluded that Ms Blythe has sufficient financial resources to meet her necessary commitments.

The parents’ duty to support others

1. The parents do not have the legal duty to support any person other than their children.

Hardship

1. Mr Blythe earns a substantial income but his expenses more or less match his income.  The decision contemplated by the Tribunal will reduce his child support liability and not contribute to any hardship for him.  

2. Ms Blythe has a substantial income through her ownership of various properties, as well as through the child support paid to her by Mr Blythe.  She also has significant investments. The Tribunal is conscious that Ms Blythe failed to fully respond to the Tribunal’s direction to provide documentation that would provide a more definitive picture of her financial circumstances.  The Tribunal has very carefully considered Ms Blythe’s circumstances and finds that the figure of $94,640.00 is appropriate in all of the circumstances. 

3. The determination contemplated by the Tribunal would change Mr Blythe’s child support liability from the $33,917.00 per annum it was at the time of his application to some $25,643.00 per annum.  Clearly this reduction will assist Mr Blythe place his finances on a more secure footing, while still ensuring that he provides a substantial contribution to the support of his children.  In this regard the Tribunal observes that Mr Blythe has regular care of his children.

4. The Tribunal emphasises that the decision contemplated by the Tribunal will not result in any increase in expenditure by Ms Blythe.  Rather it will reduce the amount of child support she receives.  She will continue to receive a substantial amount of child support.  The Tribunal is satisfied that Ms Blythe has access to sufficient financial resources that this reduction will not prevent her from meeting her necessary commitments and the necessary needs of the children.  Taking into account Ms Blythe’s primary obligation to support her children the Tribunal finds that the decision contemplated by it will not cause hardship to Ms Blythe. 

Terms and period of departure

1. The child support assessment started on 27 February 2015.  The application for departure from the formula assessment was lodged by Mr Blythe on 27 January 2017.  Having regard to the matters in subsection 117(4) of the Act, the Tribunal finds that it would be just and equitable for the departure to commence from 27 January 2017.

2. The Tribunal is conscious that both parents have found the process of determining this matter very trying.  No doubt they do not wish to go through it again at any time in the near future.  At the hearing Mr Blythe suggested a somewhat complicated arrangement that seemed designed to set a minimum ATI for Ms Blythe while providing for the possibility of it increasing over a period of time.  The Tribunal was not drawn to his suggestion, both because of its complexity and also because of the potential for unforeseen consequences.  However the Tribunal is conscious that the circumstances of the parents could change at any time.  Balancing the competing priorities the Tribunal has decided that it would be appropriate to extend the departure to 31 December 2019, by which time the parents’ tax returns for 2018/19 will be available, thus facilitating a new assessment.  If there are substantial changes in the meantime the parents may elect to apply for a further change of assessment.

Issue three – Is it otherwise proper to depart from the administrative assessment?

1. The final step for the Tribunal to undertake is to determine whether it is ‘otherwise proper’ to depart from the administrative assessment. Subsection 117(5) of the Assessment Act requires the Tribunal to take into consideration the following matters:

   (a)      the nature of the duty of a parent to maintain a child (as stated in section 3) and,   in particular, the fact that it is the parents of a child themselves who have the   primary duty to maintain the child; and

   (b)      the effect that the making of the order would have on:

   (i)       any entitlement of the child, or the carer entitled to child support, to an                    income tested pension, allowance or benefit; or

   (ii)       the rate of any income tested pension, allowance or benefit payable to   the child or the carer entitled to child support.

2. The child support law recognises that each parent has a primary duty to maintain their children.  In this case Ms Blythe receives FTB but no other benefits.  Mr Blythe does not receive any social welfare benefits other than child care rebate.  As a result of the Tribunal’s decision Ms Blythe’s FTB may change marginally.  The Tribunal finds that this is appropriate and is satisfied that it is otherwise proper to depart from the administrative assessment in this matter.

DECISION

The Tribunal sets aside the decision under review and, in substitution, decides to vary Ms Blythe’s adjusted taxable income to $94,640.00 for the period from 27 January 2017 to 31 December 2019.