Carlton and Selby (Child support)

[2018] AATA 4516

Carlton and Selby (Child support) [2018] AATA 4516 (5 November 2018)

DIVISION:  Social Services & Child Support Division

REVIEW NUMBER:  2018/MC014654

APPLICANT:  Mr Carlton

OTHER PARTIES:  Child Support Registrar

Ms Selby

TRIBUNAL:  Ms Hamilton-Noy, Member

DECISION DATE:  5 November 2018

DECISION:

The Tribunal affirms the decision under review.

CATCHWORDS
CHILD SUPPORT – particulars of the administrative assessment – post separation costs – additional income not earned during the last relevant year of income – costs not to be excluded – decision under review affirmed

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 application relates to a decision by the Department of Human Services – Child Support (the Department) to refuse to exclude Mr Carlton’s post-separation income from the child support assessment.

2. Mr Carlton and Ms Selby are the separated parents of [Child 1] and [Child 2].  A case was registered with the Department from 22 December 2015.

3. On 5 April 2017 Mr Carlton contacted the Department to request that post-separation income earned from casual employment, totalling $22,188, be excluded from his adjusted taxable income used in the child support assessment.

4. On 16 April 2018 an employee of the Department made a decision to refuse the request.

5. Mr Carlton lodged an objection to this decision on 1 May 2018 and on 5 July 2018 an objections officer of the Department disallowed the objection.

6. On 24 July 2018 Mr Carlton made application to the Administrative Appeals Tribunal for an independent review of the Department’s decision.  The hearing was held on 14 September 2018, on which date Mr Carlton attended the hearing to speak to the Tribunal in person and Ms Selby participated by conference telephone.  Both parties gave evidence on affirmation.  The Tribunal was assisted in this matter by documents provided by the Department (1 to 293).  A copy of the documents was provided to the parties prior to the hearing and Mr Carlton confirmed receipt of the documents with the Tribunal.  Ms Selby had not collected the documents from the local Post Office and was given time following the hearing to view the documents and make comment on them.  During the deferral period further information was received from the applicant (A1 to A2) and the second party (B1 to B2), which were also exchanged and time for comment was given.  The Tribunal proceeded to make a decision on all of the evidence before it on 5 November 2018. 

CONSIDERATION

1. The statutory provisions relevant to this review are contained in the Child Support (Assessment) Act 1989 (the Assessment Act) and the Child Support (Registration and Collection) Act 1988.  The issue for the Tribunal in this case is whether the Department’s decision to refuse Mr Carlton’s request for post-separation income to be disregarded was legally correct.

2. Division 3 of the Assessment Act deals with child support income and includes provisions relating to how to work out a parent’s adjusted taxable income.

3. At section 44 of the Assessment Act, the legislation allows for a parent to make application for post-separation income to be excluded from their adjusted taxable income.

4. Paragraphs 44(1)(a), (b) and (c) of the Assessment Act require that the applicant and the other parent of the child lived together on a genuine domestic basis for at least six months; that the separation, following that six month period, occurred within the last three years and before the application for administrative assessment of child support was made; and that the applicant and the other parent remained separated at the time the application under section 44 of the Assessment Act was made.

5. Paragraph 44(1)(d) of the Assessment Act was the issue in dispute in this matter. This paragraph requires that, in the last relevant year of income, or in the application period for an income election, the applicant earns, derives or receives income in the following manner:

   (i)In accordance with a pattern of earnings, derivation or receipt that is established after the applicant and the other parent first separate; and

   (ii)That is of a kind that it is reasonable to expect would not have been earned, derived or received in the ordinary course of events.

6. However, the Tribunal noted the following history of events that are relevant to the Tribunal’s decision:

   ·    Mr Carlton made an application to exclude post-separation income on 5 April 2017.  At this time his adjusted taxable income was based on a second estimate of income, accepted by the Department on 28 March 2017 (folio 37) that included the income from [Employer 1] (folio 39).

   ·    On 25 May 2017 the Department made a decision that both estimates provided to the Department were invalid (folios 72 to 73), as a result of which Mr Carlton’s 2015/2016 adjusted taxable income, as provided by the Australian Taxation Office, would continue to apply until his 2016/2017 adjusted taxable income was available to the Department.

   ·    At the time of the original decision in this matter, on 16 April 2018, this assessment remained in place, that is, the use of Mr Carlton’s 2015/2016 adjusted taxable income.

7. Mr Carlton has applied to have income earned from [Employer 1], totalling $22,818, excluded from his income for child support purposes.  The Tribunal accepted from the evidence before it that Mr Carlton commenced with [Employer 1] in November 2016. 

8. As this income was not earned in the 2015/2016 financial year, which is the “last relevant year of income” in respect of the administrative assessment of child support at the time of the original decision, it is unable to be excluded as post-separation income under section 44 of the Assessment Act.

9. Therefore, while having arrived at the decision by way of different reasoning, and while sympathetic to the circumstances raised by the applicant at the hearing, the Tribunal concluded that the Department’s decision to refuse to exclude Mr Carlton’s post-separation income from [Employer 1] is legally correct and this decision is therefore affirmed.

DECISION

The Tribunal affirms the decision under review.