Boatwright and Boatwright (Child support)

[2019] AATA 5938

Boatwright and Boatwright (Child support) [2019] AATA 5938 (25 November 2019)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2019/BC016954

APPLICANT:  Mr Boatwright

OTHER PARTIES:  Child Support Registrar

Mrs Boatwright

TRIBUNAL:Member S Letch

DECISION DATE:  25 November 2019

DECISION:

The decision under review is varied so that Mr Boatwright’s estimated adjusted taxable income is to be varied to $43,504.35 for the period 2 August 2018 to 30 June 2019.

CATCHWORDS

CHILD SUPPORT – particulars of the administrative assessment – estimate of income – calculation of adjusted taxable income under estimate review – decision under review varied

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

1. This case concerns a decision by an objections officer dated 10 July 2019 which disallowed Mr Boatwright’s objection to a decision made on 4 April 2019. In that original decision, the Child Support Agency (“CSA”), exercising its power to effectively apply its own calculation of Mr Boatwright’s estimated adjusted taxable income, determined that it should apply an estimate of $47,919 (annualised) for the purposes of determining Mr Boatwright’s child support liability under the formula arrangements for the period 2 August 2018 to 30 June 2019.

2. By way of brief background, on 11 June 2018, Mr Boatwright had earlier elected to estimate his 2018/19 taxable income as $14,078 ($540 per fortnight) from 1 July 2018. On 7 September 2018, he contacted the CSA to report his casual income had increased to $2,000 per month; an annualised estimate of $23,983 was applied from 1 August 2018.

3. On 4 April 2019, Mr Boatwright advised the CSA that he anticipated his 2018/19 taxable income would amount to the much higher sum of $45,000 (his actual 2018/19 adjusted taxable income was $42,831: folio 241 of the CSA materials). In a method explained in a CSA file at folios 123 and 124, and based on Mr Boatwright’s anticipated income for the year of $45,000, it was calculated that from 2 August 2018 to 30 June 2019, an annualised estimated income of $47,919 should apply (given Mr Boatwright had been assessed on a lower rate of income from 1 July 2018 to 1 August 2018).

4. Mr Boatwright applied to the Tribunal for review on 17 July 2019; the Tribunal conducted a hearing on 13 November 2019. Mr Boatwright and Mrs Boatwright participated by conference telephone; following the hearing, Mr Boatwright submitted additional materials (payslips covering the 2018/19 tax year from [Company 1] and an ATO income statement).

5. Mr Boatwright’s case is that the CSA has over-assessed his annualised income. At the time of the objection decision, the CSA did have the benefit of Mr Boatwright’s payslips. The Tribunal requested Mr Boatwright supply those materials and a payment summary, which he duly provided.

6. With the benefit of hindsight, more accurate information is available; in the Tribunal’s assessment, it is appropriate for an adjustment to be made to the estimated income applied for the period under review.

7. The information from [Company 1] reveals Mr Boatwright commenced on 16 July 2018; according to his income statement, he received gross payments of $41,717.56. The period from 16 July 2018 to 30 June 2019 is 350 days, which equates to an average rate of $119.19 per day. Annualising that sum (required for application to the formula) results in a figure of $43,504.35 (365 days multiplied by $119.19). [1]

   [1] In other words – if Mr Boatwright had started on 1 July 2018, not 16 July 2018, and it was assumed he earned at the same rate as he did over the year (an average of $119.19 per day), he would have received $43,504.35 in gross payments, not $41,717.56.

8. Accordingly, the Tribunal finds that the best representation of Mr Boatwright’s (annualised) adjusted taxable income for the period 2 August 2018 to 30 June 2019 is a sum of $43,504.35. The Tribunal will therefore vary the CSA decision and substitute that (lower) amount.

DECISION

The decision under review is varied so that Mr Boatwright’s estimated adjusted taxable income is to be varied to $43,504.35 for the period 2 August 2018 to 30 June 2019.