Sheadman and Andean (Child support) - [2024] AATA 2545

Sheadman and Andean (Child support) [2024] AATA 2545 (4 June 2024)

DIVISION:Social Services & Child Support Division
REVIEW NUMBER:  2023/MC026642
APPLICANT:  Mr Sheadman
OTHER PARTIES:  Child Support Registrar
Ms Andean

TRIBUNAL:Senior Member J Longo,
Member R Anderson

DECISION DATE: 04 June 2024
DECISION:

The Tribunal sets aside the decision under review and, in substitution, decides that:

The annual rate of child support payable by Mr Sheadman to Ms Andean is varied to $2,300 in respect of the period 30 January 2019 to 19 July 2020.
From 20 July 2020, the child support liability is to be calculated in accordance with the administrative assessment.

CATCHWORDS

CHILD SUPPORT – departure from the administrative assessment – income, property, financial resources and earning capacity – provisional adjusted taxable income used for father because no tax returns lodged for two years – no updated information provided – sessional work and sole trader business, impacts of COVID and now studying full-time – regular money transfers from parents and Austudy – major purpose of reducing working hours not to affect administrative assessment – decision under review set aside and substituted

REASONS FOR DECISION

BACKGROUND

Mr Sheadman and Ms Andean are the separated parents of [the child]. According to records of Services Australia – Child Support (Child Support), the child support assessment was registered on 18 August 2015. Child Support has been responsible for the collection of child support from the liable parent from the outset.
The child support liability is generally calculated in accordance with the administrative assessment, as provided in the Child Support (Assessment) Act 1989 (the Act). The calculation is based on the income recorded by each parent in their most recently completed tax returns, as lodged with the Australian Taxation Office (ATO), or the most recent estimate accepted by Child Support.
As Mr Sheadman was yet to lodge his relevant tax return, the child support liability was initially calculated using a provisional adjusted taxable income (ATI) in respect of Mr Sheadman, based on two-thirds of the male total average weekly earnings (MTAWE) of $47,504 and the 2014/15 ATI for Ms Andean of $47,790. Commencing 1 September 2016, Ms Andean’s 2015/16 ATI was used in the administrative assessment in the amount of $54,363.
It is open to either parent to lodge an application for a departure from the administrative assessment under Part 6A of the Act if they consider the administrative assessment results in an unfair amount of child support payable by one parent. Ms Andean lodged a change of assessment (departure) application on 30 January 2017. A delegate of the Child Support Registrar decided to depart from the administrative assessment in respect of Mr Sheadman on 13 June 2017, varying his ATI from 30 January 2017 to 29 January 2019 to $71,750. This resulted in the annual rate of child support payable by Mr Sheadman increasing from $1,746 to $4,552.
On 19 July 2018, Child Support wrote to both parents and provided the child support assessments for the new child support period from…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Sheadman and Andean (Child support)

Details

AGLC: Sheadman and Andean (Child support) [2024] AATA 2545
Case: [2024] AATA 2545
Decision Date: 4 June 2024

CaseChat Overview and Summary

This matter concerned an application by the father, Mr Sheadman, for a departure from a child support administrative assessment. The dispute arose because the Child Support Registrar had provisionally assessed the father's adjusted taxable income based on information available, including the fact that he had not lodged tax returns for two years. The father argued that this assessment did not accurately reflect his current financial circumstances, which had been impacted by various factors including his engagement in sessional work, operating a sole trader business, the effects of COVID-19, and his current full-time studies. He also highlighted regular financial assistance received from his parents and Austudy payments.

The primary legal issue before the Tribunal was whether the father had established grounds for a departure from the administrative assessment under the relevant legislation. Specifically, the Tribunal had to determine if the assessment failed to take into account the father's actual financial circumstances, including his income, property, financial resources, and earning capacity, to such an extent that it would be unfair to the father. A key consideration was whether the father's reduced working hours were primarily motivated by a desire to avoid or reduce his child support obligations.

The Tribunal found that the father had provided sufficient evidence to demonstrate that the administrative assessment did not accurately reflect his current financial position. It was persuaded that his reduced working hours were not solely for the purpose of affecting the child support assessment but were also influenced by his studies and the impact of COVID-19 on his business. The Tribunal considered the regular financial assistance received from his parents and Austudy as relevant financial resources. Consequently, the Tribunal set aside the original administrative assessment and substituted it with a new assessment that took into account the father's current circumstances.

Orders