Bronte and Gammar (Child support)

[2018] AATA 2282

Bronte and Gammar (Child support) [2018] AATA 2282 (18 May 2018)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2018/HC013754

APPLICANT:  Mr Bronte

OTHER PARTIES:  Child Support Registrar

Miss Gammar

TRIBUNAL:Member S Brakespeare

DECISION DATE:  18 May 2018

DECISION:

The tribunal sets aside the decision under review and, in substitution, decides that Mr Bronte’s adjusted taxable income is to be amended to $19,435.00 for the period 3 April 2017 to 30 June 2017.

CATCHWORDS
Child support - Amendment of estimated income - Incorrect calculation by the Registrar - 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 review is about whether Mr Bronte’s income election (estimate) should have been amended to $85,522 per annum.

2. Mr Bronte is the parent liable to pay child support to Miss Gammar in respect of their two children.

3. Mr Bronte lodged income estimates with the Department of Human Services, Child Support (the Child Support Agency) on 30 November 2016, 15 February 2017, 28 March 2017 and 12 May 2017.

4. On 28 June 2017 an officer of the Child Support Agency amended Mr Bronte’s estimate election for the period 6 March 2017 to 30 June 2017 to an annualised figure of $85,522 (the original decision). The basis of the decision was that Mr Bronte had an income of $27,414.14 from 6 March 2017 until 30 June 2017.

5. Mr Bronte objected to the original decision on the basis that his taxable income for 2016/17 was approximately $33,000. An objections officer disallowed the objection on 9 December 2017[1].

   [1] Mr Bronte was notified of the decision on 9 March 2018.

6. Mr Bronte lodged an application for review of the objection decision with the tribunal on 26 March 2018.

7. A hearing was held on 18 May 2018. Mr Bronte and Miss Gammar both attended the hearing and gave evidence on affirmation to the tribunal. The Department provided the tribunal and the parties with a bundle of papers (340 pages) in accordance with section 37 of the Administrative Appeals Tribunal Act 1975.

8. Relevant aspects of the evidence and material before the tribunal will be referred to in the tribunal’s consideration of the issues which it has to decide.

ISSUE

1. The legislation relevant to this review is contained in the Child Support (Assessment) Act 1989 (the Assessment Act).

2. The issue that arises in this case is whether Mr Bronte’s income estimate should have been amended to an annualised estimate of $85,522 for the period 6 March 2017 until 30 June 2017.

CONSIDERATION

11. Usually child support liabilities are determined using a child support formula in Part 5 of the Assessment Act for periods of 15 months (child support periods). The formulas take into account a range of factors including the adjusted taxable incomes of each of the parents. The adjusted taxable income for each of the parents (section 43 of the Assessment Act) is the taxable income from the last tax year that ended before the start of the child support period (plus supplementary amounts, if relevant).

12. The legislation provides some flexibility for parents whose circumstances have changed. Section 60 of the Assessment Act allows a person to lodge an income estimate. The period affected by an estimate is set out in section 60. The period starts on the day the person made an estimate or the start of the tax year, whichever is the later, and ends at the end of the tax year.

13. The effect of an income election is set out in section 61 of the Assessment Act. It is used in the assessment for a specified period unless refused under section 63AA of the Assessment Act.

14. If an estimate is used, the practice of the Child Support Agency is to send a notice under section 160 of the Assessment Act that requires a parent to notify it within 14 days of an event that affects a parent’s income.

15. Section 63A of the Assessment Act applies if a parent advises the Child Support Agency of changes to their income within 14 days. It allows the Child Support Agency to amend the adjusted taxable income from the date of the advice. If the Child Support Agency receives advice outside of that timeframe it may amend the adjusted taxable income from the date of the event.

16.  Alternatively, a parent may revoke their election to use an existing estimate if their circumstances change. If so, the parent must lodge a new estimate (which may be higher or lower than the earlier estimate). The estimate is of their taxable income and supplementary amounts from the date of lodgement (or an earlier date in some cases) until the end of the financial year. This is another estimate period.

1. The tribunal noted the following from the Child Support Agency papers:

   ·     on 3 November 2016 Mr Bronte elected that his estimated adjusted taxable income for the period 3 November 2016 to 30 June 2017 would be nil;

   ·     on 15 February 2017 Mr Bronte advised that his income for the period 30 January 2017 until 30 June 2017 would be $2810; this was annualised to $7541 for the remaining period from 15 February 2017;

   ·     on 28 March 2017 Mr Bronte advised his income for the period 5 March 2017 until 30 June 2017 would be $3121; this was annualised to $9653 from 5 March 2017.

   · On 28 March 2017 Mr Bronte was sent a notice under section 160 of the Assessment Act.

   ·     On 12 May 2017 Mr Bronte advised the Child Support Agency that he had commenced employment on 3 April 2017 that he had earned $4392 from the employment between 3 April and 7 May 2017.

2. Mr Bronte told the tribunal that he commenced casual work with [Company 1] on 30 January 2017. He was employed to work on shutdown projects as they occurred. This meant that he only worked for the period of each shutdown project and did not work between the shutdown projects. The amount of time he worked on each project varied.

3. Mr Bronte said that every time he worked on a shutdown project he contacted the Child Support Agency and advised his gross earnings. He was unable to estimate income going forward because he did not know if he would be working, or for what period he would be working.

4. Mr Bronte said that in the period that he worked for [Company 1], that is, from 30 January 2017 to 14 May 2017 his gross pay was $10,634.25. The finding by the Child Support Agency that he earned $27,414.14 from 6 March 2017 was incorrect. This meant that the annualised figure of $85,522 was also incorrect.

5. The tribunal finds that in the period 30 January 2017 to 19 March 2017 Mr Bronte had earned $5895.25 from casual employment and that these amounts formed the basis of his income estimates on 15 February 2017 and 28 March 2017. Mr Bronte did not work from 20 March 2017 to 2 April 2017.

6. The tribunal finds that an event occurred on 3 April 2017, being that Mr Bronte again commenced work with [Company 1] on a casual basis. The tribunal finds that Mr Bronte advised the Child Support Agency of that event on 12 May 2017, which was outside the 14 day notification period.

7. At the time Mr Bronte advised that he had earned $4392 in the period 3 April 2017 to 7 May 2017.

8. [Company 1] provided information to the Child Support Agency indicating that Mr Bronte earned $4739 from 3 April 2017 to 16 May 2017 and that his employment with them ceased after that date.

9. The tribunal finds that an event occurred on 3 April 2017 that affected the accuracy of the assessment and therefore the income election should be amended from the event date, being 3 April 2017.

10. The tribunal finds that the amended assessment should be based on an income of $4739 which was what Mr Bronte earned for the period 3 April 2017 to 30 June 2017. When annualised that income is $19,435.00[2].

    [2] Rounded pursuant to section 156 of the Assessment Act.

11. The tribunal finds that there is no basis for using an income of $27,414.14 for Mr Bronte for the period 6 March 2017 to 30 June 2017.

DECISION

The tribunal sets aside the decision under review and, in substitution, decides that Mr Bronte’s adjusted taxable income is to be amended to $19,435.00 for the period 3 April 2017 to 30 June 2017.