Callaghan and Child Support Registrar (Child support)

[2022] AATA 948

Callaghan and Child Support Registrar (Child support) [2022] AATA 948 (3 March 2022)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2022/BC023107 & 2022/BC023420

APPLICANT:  Miss Callaghan

OTHER PARTIES:  Child Support Registrar

TRIBUNAL:Senior Member R Ellis

DECISION DATE:  03 March 2022

DECISION:

2022/BC023107

The Tribunal sets aside the decision under review and, in substitution, decides that the application made by [Mr A] for the fixed annual rate of child support to no longer apply to the assessment from 1 August 2021 to 31 October 2022 is refused.

2022/BC023420

The Tribunal sets aside the decision under review and, in substitution, decides that the application made by [Mr A] for the assessment to be reduced to nil from 11 August 2021 to 31 October 2022 is refused.

CATCHWORDS

CHILD SUPPORT – particulars of the administrative assessment – whether a fixed annual rate of child support should not apply – income exceeds the allowable limit – the application for fixed annual rate not to apply should be refused – decision under review set aside and substituted

CHILD SUPPORT – particulars of the administrative assessment – application for assessment to be reduced to nil should be refused – 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 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. Miss Callaghan and [Mr A] are the parents of [the child] (born January 2018).  There has been a child support assessment in place since 24 March 2018 and [Mr A] is the liable parent under the assessment.

2. On 29 October 2021 [Mr A] made an application to the Child Support Agency for the fixed annual rate of child support to no longer apply to the assessment from 1 August 2021 to 31 October 2022.

3. On 29 October 2021 the Child Support Agency made the decision to accept this application for the fixed annual rate to no longer apply to the assessment from 1 August 2021 to 31 October 2022.

4. On 5 November 2021 Miss Callaghan objected to this decision and on 5 January 2022 the Child Support Agency allowed the objection in part and made the decision to accept the application for the fixed annual rate to no longer apply to the assessment, but from 11 August 2021 to 31 October 2022 (the first objection decision).

5. On 29 October 2021 [Mr A] also made an application to the Child Support Agency for the minimum annual rate of child support to no longer apply to the assessment from 11 August 2021 to 31 October 2022.

6. On 29 October 2021 the Child Support Agency made the decision to accept this application for the minimum annual rate to no longer apply to the assessment from 11 August 2021 to 31 October 2022.

7. On 5 November 2021 Miss Callaghan objected to this decision and on 5 January 2022 the Child Support Agency disallowed the objection (the second objection decision).

8. On 11 January 2022 Miss Callaghan applied to the Administrative Appeals Tribunal (the Tribunal) for a review of the first objection decision and of the second objection decision.

9. The Tribunal conducted a hearing into both applications on 3 March 2022.  Miss Callaghan gave evidence on affirmation by conference telephone.  [Mr A] was initially added as a party to this matter.  On 14 January 2022 the Child Support Agency advised the Tribunal there was no valid telephone number or contact address available for [Mr A].  On 2 February 2022 the Tribunal unsuccessfully attempted to contact [Mr A] on a mobile telephone number provided by Miss Callaghan.  On 2 February 2022 the Tribunal sent [Mr A] a SMS message requesting he contact the Tribunal.  [Mr A] did not respond.  As the Tribunal was unable to get in touch with [Mr A] and had no current address available for him he was removed as a party to the proceedings.  The Child Support Agency provided the Tribunal and Miss Callaghan with papers relevant to both matters (104 pages).

ISSUES

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

2. The issues which arise in this case are, firstly, whether or not the fixed annual rate of child support should apply in respect of [Mr A]’s child support liability and, secondly, whether or not the minimum annual rate of child support should apply in respect of [Mr A]’s child support liability.

CONSIDERATION

1. Miss Callaghan told the Tribunal it was her understanding that [Mr A] was incarcerated from 1 August 2021 up until around 11 November 2021.  Miss Callaghan said when the Child Support Agency spoke to [Mr A] on 29 October 2021 he confirmed he was in prison.

2. Miss Callaghan said from 1 August 2021 [Mr A] had been assessed to pay child support based on a provisional 2020-21 income of $52,638 because he had not submitted a tax return for a number of years.  Miss Callaghan said on 23 July 2021 she had applied for a change of assessment because she did not wish to incur a child support debt based on this income.  Miss Callaghan said the Child Support Agency had refused her application because [Mr A] had been paying his child support and could obviously afford it even though he was not working.  Miss Callaghan pointed out that if [Mr A] could meet his child support obligations even though he was incarcerated he must have another source of income.

3. The Tribunal notes in evidence from the Child Support Agency that a child support officer spoke to [Mr A] on 29 October 2021 in relation to his assessment.  During this conversation [Mr A] advised he worked for short periods during 2020-21 and was not working in prison.  The child support officer accepted an income tax declaration of $8,301 from [Mr A] for 2020-21 based on salary payments from two employers.  The child support officer also accepted applications from [Mr A] for the fixed annual rate not to apply to the assessment and for the minimum annual rate not to apply to the assessment.

4. Miss Callaghan pointed out that while [Mr A] was in prison he made a number of child support payments including an amount of $122.25 on 6 August 2021, an amount of $368.00 on 31 August 2021 and an amount of $367.98 on 7 October 2021.  Miss Callaghan argued this proved [Mr A] had the capacity to pay child support.  Miss Callaghan said, furthermore, she had received a SMS message from [Mr A] on 2 February 2022 stating that he was moving to Queensland and was going to buy a house.  Miss Callaghan submitted that [Mr A] should not be assessed on the minimum annual rate and certainly not on a rate of $0.

5. Miss Callaghan told the Tribunal that as a result of the two decisions made by the Child Support Agency she had a child support debt.  She said as a single mother this had placed her in considerable financial hardship.

6. For low-income parents not on income support a fixed annual rate of child support is payable (section 65A of the Act).

7. A parent who has been assessed at the fixed annual rate under section 65A of the Act may make an application to the Child Support Agency for it not to apply (section 65B).  The parent making the application must provide evidence to demonstrate their current income is less than the parenting payment (single) maximum basic amount and that it would be unjust and inequitable to expect them to pay the amount assessed under section 65A.

1. At the time relevant to this review the fixed annual rate was $1,477 per child. The Tribunal is satisfied the Child Support Agency made a determination under section 65A of the Act which required [Mr A] to pay the fixed annual rate in respect of [the child].  The Tribunal also finds that [Mr A] made an application under section 65B on 29 October 2021.

2. Although [Mr A] did not participate in the hearing it is noted the Child Support Agency appears to have established he was incarcerated from 11 August 2021 to 12 November 2021.

3. The parenting payment (single) maximum basic amount at the time relevant to this review was $20,298 per annum.  In considering an application under section 65B of the Act for the fixed annual rate not to be used, the definition of income in subsection 66A(4) of the Act must be considered in order to determine if the parent’s income is no more than this amount.  In subsection 66A(4), “income” is not restricted to taxable income.  It is defined as:

   ·     any money earned, derived or received by the parent for his or her own use or benefit; or

   ·     a periodical payment by way of a gift or allowance.

4. [Mr A] was in prison for a period of approximately three months.  When he made his application on 29 October 2021 for the fixed annual rate not to apply he was two weeks from being released.  There is no information before the Tribunal relating to what income, as defined under the Act, was available to [Mr A] after 12 November 2021.

5. For the purposes of determining a parent’s current income the Child Support Guide, at 2.5.3, states this is generally considered as “their income for the 12 month period from the date of application”.  While the Tribunal accepts [Mr A] was not earning an income during his time in prison, there is insufficient evidence to reach a reasonable conclusion about his income for a 12-month period.  The Tribunal is not satisfied a determination can be made, based on the evidence provided, that [Mr A]’s current income would be no more than the relevant parenting payment (single) maximum basic amount.

6. Even if the Tribunal were to take a different view in relation to [Mr A]’s current income, it is then necessary to determine whether or not it would be unjust and inequitable to expect him to pay the amount assessed under section 65A.

7. The Tribunal notes in evidence from the Child Support Agency a copy of the change of assessment decision made on 22 October 2021.  In reviewing the income, property and financial resources of [Mr A] the decision maker found that he was up-to-date with his child support payments and concluded [Mr A] “has the capacity to pay child support based on an income of $52,638 and therefore the use of this income does not render the child support assessment unfair”.

8. As [Mr A] had sufficient resources to meet his child support obligations, at least up until 22 October 2021, based on a taxable income of $52,638, it would be difficult to conclude it is unjust and inequitable for him to pay the fixed annual rate.

9. The Tribunal finds that [Mr A] has not met the requirements of section 65B of the Act.  His application for the fixed annual rate of child support not to be applied to his child support assessment for the period from 1 August 2021 to 31 October 2022 should not, therefore, be accepted.

10. Section 66A of the Act allows a child support assessment to be reduced to nil in certain cases.  It states that if an assessment has been made under section 66 to set a child support liability at the minimum annual rate the Child Support Agency may, following an application by a parent, reduce the child support assessment to nil.

11. As the Tribunal has determined that [Mr A]’s application for the fixed annual rate not to apply should be refused it follows that his application for the minimum annual rate to be reduced to nil must also be refused.  As [Mr A] will be assessed on the fixed annual rate from 1 August 2021 he cannot be on the minimum annual rate (subsection 66(2) of the Act) and so cannot apply to have the assessment reduced to nil.

12. The decision made on 29 October 2021 to accept the application for the minimum annual rate to no longer apply to the assessment from 11 August 2021 to 31 October 2022, therefore, falls away.

DECISION

2022/BC023107

The Tribunal sets aside the decision under review and, in substitution, decides that the application made by [Mr A] for the fixed annual rate of child support to no longer apply to the assessment from 1 August 2021 to 31 October 2022 is refused.

2022/BC023420

The Tribunal sets aside the decision under review and, in substitution, decides that the application made by [Mr A] for the assessment to be reduced to nil from 11 August 2021 to 31 October 2022 is refused.