Inskip and Souttar (Child support)

[2021] AATA 2908

Inskip and Souttar (Child support) [2021] AATA 2908 (16 July 2021)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2021/MC021499

APPLICANT:  Mr Inskip

OTHER PARTIES:  Child Support Registrar

Ms Souttar

TRIBUNAL:Member S Brakespeare

DECISION DATE:  16 July 2021

DECISION:

The decision under review is affirmed.

CATCHWORDS

CHILD SUPPORT – particulars of the administrative assessment – whether the adjusted taxable income for past period for the liable parent should be changed – conditions for changing the income to lower amount are not met – 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. Mr Inskip is the parent liable to pay child support to Ms Souttar in respect of [their child].

2. On 13 June 2020 an officer of the Child Support Agency made a decision to apply a provisional 2019/20 income for Mr Inskip of $51,151 to the administrative assessment for the child support period 23 July 2020 to 22 October 2021.

3. On 9 March 2021 an officer of the Child Support Agency made a decision to apply a provisional income of 2019/20 income for Mr Inskip of $16,756 to the administrative assessment for the period 9 March 2021 to 22 October 2021 (the original decision). Mr Inskip lodged an objection the decision on the basis that that his 2019/20 income of $16,756 should apply to the assessment from an earlier date, being 23 July 2020.

4. An objections officer disallowed the objection on 12 May 2021 (the objection decision). Mr Inskip lodged an application for review of the objection decision with the tribunal. A hearing was held on 16 July 2021. Mr Inskip and Ms Souttar gave evidence on affirmation to the tribunal via conference telephone. The Child Support Agency provided the tribunal and the parties with a bundle of papers relevant to the review (80 pages).

5. 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 statutory provisions relevant to this review are the Child Support (Assessment) Act 1989 (the Act) and the Child Support (Registration and Collection) Act 1988 (the R&C Act).

2. The issue which arises in this case is whether a retrospective determination can be made in respect of Mr Inskip’s 2019/20 income of $16,756.

CONSIDERATION

1. Section 58 of the Act allows the Child Support Agency to determine a person’s adjusted taxable income for a child support period where either the person’s taxable income for the last relevant income year has not been assessed under the Income Tax Assessment Act or the Child Support Agency is unable to ascertain whether or not the person’s taxable income for that year has been so assessed.

2. Subsections 58(2), 58(3) and 58(4) provide a number of methods for determining a person’s provisional adjusted taxable income. The Child Support Agency may rely upon information or a document which specifies the person’s adjusted taxable income for the last relevant year of income or that allows an amount to be worked out.  Alternatively the Child Support Agency may apply an indexation factor to a person’s adjusted taxable income from a previous year. Alternatively the Child Support Agency may use the amount that is equal to two-thirds of the annualised MTAWE (Male Total Average Weekly Earnings) figure for the relevant June quarter in relation to the child support period

3. The tribunal finds that the Child Support Agency determined that Mr Inskip’s adjusted taxable income was $51,151 under section 58 of the Act in respect of the child support period 23 July 2020 to 22 October 2021. This income was derived using the MTAWE method.

4. Section 58A of the Act applies if the Child Support Agency subsequently ascertains components of a person’s adjusted taxable income and the amount is different than the amount determined under section 58. So far as is relevant here (that is, where the later amount is less than the amount applied to the assessment), a retrospective determination can only be made in circumstances prescribed by the Child Support (Assessment) Regulations 2018 (the Regulations) – if so, the Registrar must immediately amend the administrative assessment for the child support period on the basis that the person’s adjusted taxable income for that year of income is, and has always been, the amount that was subsequently ascertained or later determined (as the case requires).

5. On 9 March 2021, on the basis of information provided by Mr Inskip the Child Support Agency determined that Mr Inskip’s 2019/20 adjusted taxable income was $16,756.

6. Section 11 of the Regulations provides that the prescribed circumstances are :

   ·     the parent did not know that an application for the assessment had been made and accepted;

   ·     the parent had a serious illness or injury;

   ·     the parent was under detention or imprisonment;

   ·     the parent resided in a remote location which made it difficult to contact the Registrar;

   ·     a natural disaster prevented the parent from being able to contact the Registrar;

   ·     there was some other exceptional circumstance that prevented the parent from providing the information.

   One or more of the prescribed circumstances must apply in relation to the parent for the determination to be retrospective.

7. Mr Inskip told the tribunal that he did not realise that he had to complete an income tax return for 2019/20 because he was on Centrelink payments throughout the period. He thought that the Child Support Agency knew that he was on Centrelink payments because child support was being deducted from the payments. He assumed that the Child Support Agency knew what his income was.  He said that he did not receive the letter of 13 June 2020 (advising him of the assessment using the provisional income of $51,151). He said that he changed address several times during that period. When he secured employment he contacted the Child Support Agency and that was when he became aware of the provisional income and of the requirement to lodge an income tax return. Once he advised the Child Support Agency of his actual income for the year he assumed it would be backdated, as he never earned $51,151 for the year.

8. Ms Souttar said that she thought the determination to use the income of $16,756 in the assessment should be backdated as she thought it was unfair for Mr Inskip to be assessed on the higher amount.

9. The tribunal is satisfied that none of the prescribed circumstances apply to Mr Inskip and therefore the retrospective determination does not apply. This means that the administrative assessment must be amended to take into account the income of $16,756 for the period 9 March 2021 to 22 October 2021.

DECISION

The decision under review is affirmed.