Harland and Harland (Child support)

[2021] AATA 3175

Harland and Harland (Child support) [2021] AATA 3175 (15 June 2021)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2019/HC017872

APPLICANT:  Mr Harland

OTHER PARTIES:  Child Support Registrar

Ms Harland

TRIBUNAL:Member H Schuster

DECISION DATE:  15 June 2021

DECISION:

The decision under review is affirmed.

CATCHWORDS

CHILD SUPPORT – fixed annual rate – whether current income is below rate of PP single payment – whether payment of fixed annual rate is unjust and inequitable – decision under review affirmed

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. This is a review of an objection decision made by Services Australia (Child Support) to refuse Mr Harland’s application of 4 July 2019 not to apply the fixed annual rate of child support.

2. Mr Harland and Ms Harland are the parents of [three named children]. A child support assessment in relation to the children has been in place at all relevant times. Ms Harland has 100% care of the children. Mr Harland is the parent liable to pay child support.

3. For the child support period from 17 May 2019 to 16 August 2020 Child Support decided that Mr Harland’s annual rate of child support was the fixed annual rate of $1,854  per year.

4. On 4 July 2019 Mr Harland made an application for the fixed annual rate not to apply to him for the child support period from 17 May 2019 to 16 August 2020.

5. On 12 July 2019 Child Support decided to refuse to grant Mr Harland’s request not to have the fixed annual rate apply to him.

6. On 21 July 2019 Mr Harland objected to that decision. His objection was disallowed on 21 September 2019.

7. On 19 November 2019 Mr Harland applied to the Administrative Appeals Tribunal (the Tribunal) for review of that decision.

8. Due to COVID-19 restrictions, Mr Harland’s hearing impairment and difficulties in scheduling an in-person hearing, Mr Harland elected to provide submissions in writing and for the Tribunal to make the decision ‘on the papers’. Ms Harland agreed.

9. The Tribunal had as evidence before it documents prepared by Child Support and written submissions from Mr Harland.

ISSUES

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

2. The issues in this case are:

   ·      whether Mr Harland’s income in 2019 was less than the parenting payment (single) (PPS) maximum basic amount and

   ·      whether it would be unjust and inequitable to require him to pay the fixed annual rate of child support from 17 May 2019.

CONSIDERATION

1. Child Support, on behalf of the Child Support Registrar (the Registrar), is required to assess each parent’s adjusted taxable income and determine an annual rate of payment. Under section 65A of the Act the fixed annual rate of child support will be applied to a person’s adjusted taxable income if it is less than the annual basic rate for PPS and they are not in receipt of an income support payment, such as age pension. In July 2019 the basic PPS rate was $19,981.

2. The fixed annual rate in 2019 was $1,443 per child. However, if the person is required to pay child support for more than three children the rate is capped at three times the annual rate and then equally apportioned between all the children subject to a child support assessment. On that basis, Mr Harland has been assessed to pay child support of $1,854 per year to Ms Harland in respect of the three children.

3. A person may apply for the fixed annual rate not to apply under section 65B of the Act.

4. The application requirements are set out in subsection 65B(2) of the Act as follows:

   (2) The parent making the application must provide evidence to the Registrar concerning the parent’s income (within the meaning of subsection 66A(4)) to demonstrate that his or her current income is:

(a) less than the pension PP (single) maximum basic amount; and

(b) that it would be unjust and inequitable to expect him or her to pay the amount assessed under this section. 

(3) An assessment issued by the Commissioner of Taxation for the last relevant year of income shall not be sufficient evidence of the income of the parent for the purposes of this section.

1. For the purpose of section 65B, the term ‘income’ is defined in subsection 66B(4) as follows:

   (a)   any money earned, derived or received by the parent for his or her own use or benefit, other than money earned, derived or received in a manner, or from a source, prescribed by the regulations for the purposes of this paragraph; or

(b)   a periodical payment by way of a gift or allowance, other than a payment of a kind prescribed by the regulations for the purposes of this paragraph.

1. The Registrar has the discretion, under subsection 65B(4) of the Act, to determine that the fixed annual rate is not to apply to the person if satisfied that their income is less than the annual limit and it would be ‘unjust and inequitable’ to expect the person to pay the assessed amount.

2. The Tribunal finds that Mr Harland has made an application under section 65B of the Act.

3. At the time of making his application in 2019 Mr Harland was not in receipt of any income support payments, and according to his initial evidence to Child Support his income was around $4,800 per year. He provided a statement of his financial circumstances which indicated his annual expenses were around $33,000 and he had savings in three bank accounts totalling $2,600. He declared owning a family home in NSW for which he received no rent but met expenses of about $6,000 per year.

4. Mr Harland’s submission may be summarised as follows:

   ·      He is a retired [occupation 1] aged [age] with significant hearing loss and is not employable. He stated he worked for one month in 2018 but has had no work since then.

   ·      He has generally lived in [Country 1].

   ·      He became entitled to age pension [in] 2013, was granted the pension but then it was cancelled. Applications made by him in 2016 and 2018 were also refused.

   ·      Between 2013 and 2016 his only income has been from ‘occasional periods of brief consultancy overseas’. 

   ·      He returned to Australia in 2020 and from 26 March 2020 was granted age pension.

   ·      He stated he was not required to lodge tax returns in Australia while living overseas but in 2020, after a request from the Australian Taxation Office, he lodged tax returns for the 2012/13 to 2018/19 financial years. He had no taxable income in 2016/17 or 2018/19 and his taxable income in 2017/18 was $12,000.

   ·      He said he made declarations about having income to Centrelink which were untrue because he was worried they would not accept his evidence that he had no income.

   ·      Mr Harland said that his annual ‘liabilities’, or rather, the shortfall between his stated income and declared expenses was less than the $33,000 he had previously estimated. He said his actual expenditure was significantly lower and any shortfall was covered by credit cards, loans from family and savings carried over from previous years.

   ·      He noted that the reasons for his frequent travel arose out of connections with family in [several specified countries].

   ·      He states an ex-partner (not Ms Harland) resides in his home in NSW rent free. He has paid rates and water bills for the past 5 years on the property at $2,500 per year and averaged about $3,500 in expenses on the property per year.

   ·      He noted that he has five children in Australia and a further [number] children overseas and is subject to number] child support cases.

   ·      He says some of his children live in developing countries and have mothers who are not supported by ‘the welfare state’ and that he ‘[does] not fail them’.

   ·      In a new statement of financial circumstances (A6–A13) he declares owning property and assets of $223,000 and having expenses of around $260 per week which is less than half his age pension rate.

5. It is the parents’ primary duty to support their children. The Tribunal notes that Mr Harland suggests he sees his duty to support children not covered by an Australian child support assessment as being a significant aspect of his application. However, his duty to support children in other countries is not higher than his duty to support his children in Australia. More importantly, he has not provided any particulars to what extent he supports some but not others of his children, nor how he has marshalled the financial resources necessary to do so. He has made assertions which are not corroborated by any evidence.

6. The Tribunal notes that despite professing to have had income of $12,000 over a three year period, Mr Harland has nonetheless been able to travel internationally, has been able to re-establish his residence in Australia and now has access to rent free accommodation. At the time of his 2019 application, he received no rental income but on his own account was able to cover costs relating to the property of about $6,000 per year.

7. Mr Harland has submitted that, as at 2019, his annual expenses exceeded his income and the shortfall was covered by savings. However, even if the Tribunal accepted that his expenses were less than $33,000 per year, the information he has provided falls well short of demonstrating what his expenses were and how he was able to meet them.

8. In a response to the Registrar in 2019 Mr Harland acknowledged that ‘his family’ owned property in [Country 1] and he owned land with [cottages] on it occupied by families whom he supports, however those assets do not appear in any of his statements of financial circumstances.

9. The Tribunal tried to compare Mr Harland’s statements about his financial position from 2019 and 2021. In 2019 he declared less than $5,000 income per year, expenses of $33,000 and his only financial assets as savings of $2,600. Despite having no apparent source of additional income, more recently he has declared investments of $10,000, in addition to his property and savings. While he suggests having incurred significant credit card debt of around $16,000, the Tribunal noted that in early 2020, before his age pension was granted, his [credit] card had been prepaid such that he had access to an additional $3,000.

10. The Tribunal is not persuaded that the limited information provided is a full and complete account of Mr Harland’s financial resources either as at 2019 or since then. Mr Harland has provided a patchwork of assertions which are difficult to reconcile much less put into context without corroborating evidence. Ultimately, the Tribunal is persuaded that Mr Harland was able to meet his personal expenses, maintain his assets and, on his own account, was able to provide support for some of his children.

11. In the circumstances the Tribunal finds it would not be unjust and inequitable to expect Mr Harland to pay the fixed annual rate of child support in respect of the child support period from 17 May 2019. That means, he does not satisfy the criteria in section 65B of the Act and his application not to apply the fixed annual rate must be refused.

DECISION

The decision under review is affirmed.