Tatro and Arterton (Child support)

[2021] AATA 2726

Tatro and Arterton (Child support) [2021] AATA 2726 (12 May 2021)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2020/MC020317

APPLICANT:  Miss Tatro

OTHER PARTIES:  Child Support Registrar

Mr Arterton

TRIBUNAL:Member W Budiselik

DECISION DATE:  12 May 2021

DECISION:

The tribunal sets aside the decision under review and substitutes its Decision that:

• for the period 1 July 2020 to 30 September 2021, Miss Tatro’s adjusted taxable income is varied to $105,139 and Mr Arterton’s adjusted taxable income is varied to $80,648;

• in the period 1 October 2020 to 30 September 2021, the annual rate of child support payable by the mother is increased by $3,048.

CATCHWORDS

CHILD SUPPORT – departure determination – income, property and financial resources of both parents – benefits derived from business – cost of school fees – whether mutual intention existed to educate the child in particular manner – 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 Tatro (the applicant/mother) and Mr Arterton (the father) are the parents of [Child 1] (the child) (born January 2006). An administrative assessment of child support has been in place between the parents in respect of the child since 5 December 2006. Services Australia (the Agency) records the child as being in the father’s care for 100% of the time since 15 April 2020. Prior to 15 April 2020, the Agency records the child as being in the mother’s primary care and the father’s regular care. Prior to 15 April 2020, the father paid the mother child support. Since 15 April 2020, the mother pays the father child support.

2. On 27 May 2020, the father lodged an application with the Agency to depart from the administrative assessment of child support. In his application the father cited the grounds for departure from the administrative assessment as: the child’s special needs and the extra costs in caring for, educating or training the child in the way both parents intended. On 6 April 2020, the father withdrew the ground related to the child’s special needs.

3. The tribunal notes that the father’s application for the departure determination is dated 27 June 2020. However, the application was received by the Agency on 27 May 2020. The tribunal concluded the father had misdated his application.

4. At the time the father lodged his change of assessment application the father’s 2018/2019 adjusted taxable income (ATI) was recorded by the Agency as $70,648 and the mother’s 2018/2019 ATI was recorded by the Agency as $104,818. When the child was in the mother’s primary care the father’s child support liability was assessed as $3,422. After the child relocated to the father’s care, from 15 April 2020, the mother’s child support liability was assessed as $11,248. Subsequently, the Agency accepted the mother’s income estimate of $80,195 which was applied from 1 July 2020. This estimate reduced the mother’s annual child support liability to $7,839. 

5. On 18 June 2020, the mother also lodged an application with the Agency to depart from the administrative assessment. In her application the mother cited the grounds for the departure as: the parents’ income, property and/or financial resources, the father’s earning capacity and her duty to support another person.

6. On 8 July 2020, an officer from the Agency found there was a reason to change the assessment because of the extra costs in educating the child. The officer increased the mother’s child support liability to reflect her share of the child’s school fees.  

7. On 21 July 2020, the mother objected to the Agency’s decision. On 27 October 2020, an objections officer from the Agency considered the mother’s objection and decided:

   For the period 1 July 2020 to 30 June 2021, the ATI for the mother is set at $78,318.

   For the period 1 October 2020 to 30 September 2021, the annual rate of child support payable by the mother is increased by $3,571.

   The increase in the annual rate of child support payable by the mother by $3,571 reflected the objections officer’s accommodation of the child’s school fees and the child’s special needs (orthodontic costs).

8. On 25 November 2021, the mother lodged an application for a review of the Agency’s decision.

9. On 2 March 2021, the tribunal conducted a telephone directions hearing (TDH) with the parents. The purpose of a TDH is in part to enable the tribunal to understand the scope of an applicant’s objection to an Agency decision and for it and the parents to identify documents which might assist in hearing the matter.

10. At the TDH the applicant clarified the scope of her objection was the Agency’s decisions about her income and her contribution to the child’s school fees. The tribunal discussed the matter in detail at the TDH and referred to the objections officer’s decision and their use of the applicant’s Business Activity Statements (BASs). It was agreed at the TDH the mother would provide BASs for the first two quarters of the 2020/2021 financial year. A hearing was scheduled for 19 April 2021, which enabled the mother time to provide the first two quarters of the 2020/2021 BASs.

11. The mother did not provide the BASs by the due date (30 March 2021). The tribunal issued a ‘show cause’ notice which required the applicant to advise it why the matter should not be dismissed. The applicant responded by apologising for missing the deadline. She also provided relevant financial information to the end of 2020. However, she did not provide the BASs.

12. The tribunal proceeded and conducted a hearing with both parents via teleconference into the mother’s application on 19 April 2021. Prior to the hearing the Agency provided a bundle of papers to the parents and to the tribunal (folios 1–371)). The parents provided bundles of documents (from the mother folios A–A152 and from the father B1–B11), which have been provided to the Agency. The mother’s response to the ‘show cause’ notice and the additional documents she provided on 8 April 2021 with her response, are contained in folios A60–A 152 of the bundle.

13. On 19 April 2021, the tribunal deferred its decision making to enable the mother to provide additional information about her 2020/2021 financial year income (folios A153–A160).

14. Information provided by the parents has been provided to the Agency.

ISSUES

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

2. The tribunal also referred to the Agency’s online Child Support Guide (the Guide). The tribunal is not bound by law to apply the Agency’s policy as set out in the Guide, but provided the policy is consistent with the legislation, it must have regard to it and in the ordinary course, to follow it (Drake v Minister for Immigration and Ethnic Affairs (1979) 46 FLR 409) unless there is a cogent reason not to do so (Re Drake and Minister for Immigration and Ethnic Affairs (No 2) (1979) 2 ALD 634).

3. The three issues to be determined by the tribunal are:

   a)   whether a ground is established to depart from the administrative assessment of child support; and if so,

   b)   whether it is just and equitable to make a particular departure determination; and if so,

   c)   whether it is otherwise proper to make a particular departure determination.

CONSIDERATION

1. The rate of child support payable by a liable parent is usually based on an administrative assessment calculated using the relevant formula under Part 5 of the Act. This involves the application of a statutory formula which takes account of factors such as the adjusted taxable income of each parent, the number of children and the level of care provided. A parent’s adjusted taxable income for a given year is calculated according to a formula that includes a parent’s previous year’s taxable income (see section 43 of the Act).

2. Part 6A of the Act allows for a departure from an administrative assessment. The liable parent or a carer entitled to child support may apply to the Child Support Registrar (the Registrar) for a determination to depart from the child support administrative assessment under Part 6A of the Act.

3. Section 98C of the Act provides that the Registrar (and the tribunal in the Registrar’s place) may make a determination to depart from the administrative assessment if satisfied that a ground exists and that it would be just and equitable and otherwise proper to make a particular determination. The tribunal may make one of the determinations set out in section 98S of the Act.

4. The grounds for departure from the administrative assessment are set out in subsection 117(2) of the Act. Each ground for departure is prefaced by the words, ‘in the special circumstances of the case’. Therefore, when considering whether a ground exists, the tribunal must be satisfied that there are ‘special circumstances’ in the case. The phrase ‘special circumstances’ is not defined in the Act. The Full Family Court, in the case of Gyselman and Gyselman (1992) FLC 92-279, held that:

   It is intended to emphasise that the facts of the case must establish something which is special or out of the ordinary. That is, the intention of the Legislature is that the court will not interfere with the administrative formula result in the ordinary run of cases.

Issue 1: Is there a ground for departure?

The child’s education costs

1. Subparagraph 117(2)(b)(ii) of the Act provides a ground for departure exists where, in the special circumstances of the case, the costs of maintaining the child are significantly affected because the child is being cared for, educated or trained in the manner that was expected by their parents.

2. The matter of school fees in child support cases has been considered judicially on various occasions. The principles that emerged from the Full Court of the Family Court (Mee and Ferguson [1986] FamCA 3) in relation to school fees can be summarised as follows:

   ·      where a parent has agreed to the child attending a private school, that parent is ‘liable to contribute to the fees involved so long and to the extent that he or she has a reasonable financial capacity to continue to do so’; and

   ·      where a parent has not agreed to the child attending such a school, they are not liable to contribute to those expenses unless there are reasons relating to the child’s welfare which dictate attendance at the school rather than a non-private school. Then the parent is required to contribute to the extent that they have a reasonable financial capacity to do so.

   This reasoning has been applied to subsequent child support cases. The tribunal also notes that, in deciding this matter, it needs to consider the type of education intended by both parents for the children, rather than any particular school intended by the parents: Wild and Ballard (1997) FLC 92-771.

3. On 23 March 2019, the parents and child signed a contract with the canonical administrators of [School 1] College (the school) which, among other things, stated, ‘parents will be jointly and severally liable for the payment of fees’.

4. At the time the relationship between the child and mother broke down in April 2020, the mother wrote to the father about the child:

   Going to [School 1] was a privilege (her half-sister) didn’t get and I’m disappointed [Child 1] hasn’t taken this opportunity seriously. I do not wish to continue paying for a school that has done her no justice.  I simply can’t afford it and think that she would be no worse off going to a public school.

26.While appreciating the mother has since changed her mind, the tribunal concluded there was a mutual expectation the child would be educated privately.

1. A schedule provided by the school set out the child’s relevant school fees for Year 9 (2020) as $6,720 and for Year 10 (2021) as $5,770.

2. The mother did not dispute the accuracy of the fees.

3. Being satisfied there was a mutual expectation about the child’s attendance at the school the tribunal finds that because the annual school fee significantly affects the costs of maintaining the child there is a ground for departure from the administrative assessment of child support.

Issue 2: Is it just and equitable to depart from the administrative assessment?

1. To decide whether it is just and equitable to depart from the administrative assessment, the tribunal must consider the matters required by subsection 117(4) of the Act, plus any other matters raised in the change of assessment application. Factors relevant to the circumstances of this case identified in subsection 117(4) of the Act are now considered in turn.

Duty of a parent to maintain a child

1. Section 3 of the Act makes it clear that the parents of a child have the primary duty to maintain the child, and that this duty has priority over all commitments of the parents other than commitments necessary for self-support or the support of another person the parent has a duty to maintain.

2. The tribunal notes that the Family Court of Australia has been prescriptive about the types of expenses that can be considered ‘necessary’ expenses and that there are only a few expenses that can be considered to take priority over a parent’s primary duty to support their child(ren). This includes expenses such as a reasonable amount for payment of rent or mortgage, food, utilities and some loans. In Mee and Ferguson [1986] FamCA 3 (Mee and Ferguson) the Full Court of the Family Court stated at [128]:

   Some of the items obviously have to be taken into account before maintenance is arrived at; for example, the cost of reasonable transport, food and clothing, and other like expenses are necessary to the continued reasonable existence of a parent, and, barring legislative direction to the contrary, it would not accord with the understanding in this jurisdiction to suggest that those items should be put out of consideration before child maintenance is determined. On the other hand there is no doubt that one of the primary responsibilities of a parent is the continued support of children to the extent to which the parent continues to be able to do so and that may in appropriate circumstance mean making financial sacrifices or cutting one’s cloth to meet that commitment during the years when it applies.

The proper needs of the child

1. In determining the proper needs of the child(ren) it is necessary to consider the manner in which the parents expected the child(ren) to be cared for, educated or trained, and any special needs of the child(ren).

2. The parents’ expectations about the child’s education have already been considered.

3. The tribunal’s view is that the costs associated with the child’s education warrant a departure from the administrative assessment in place.

4. The objections officer’s decision also dealt with the child’s special orthodontic needs and associated costs. The objections officer set out that the mother had incurred a debt associated with the child’s orthodontic work ($6,530) on 22 January 2020 such that she was required to pay a deposit of $745 and the remainder via payments of $120 per month for 24 months. The father provided evidence he had paid $120 per month in respect of the costs with the last payment being on 6 April 2020 and that he had not contributed to this account since then.

5. The parents did not raise the way the objections officer had dealt with the child’s special needs and associated costs at the hearing.

6. The mother said she pays about $970 per annum ($81.15 per month) in private health insurance for the child.

7. The objections officer’s decision took into account the school fees and the child’s special needs costs and calculated the mother’s school fee cost for the period May 2020 to the end of the 2021 school year $5,984 ($2,351 for the period from May 2020 until the end of the school year and $3,633 for the 2021 year) less the amount of $2,413 the father must contribute so he pays for 50% of the child’s orthodontic costs, resulting in an increase in the mother’s liability by $3,571 (as the outcome whereby the mother is supported in meeting the child’s orthodontic costs and the father is supported in meeting the child’s school fees until the end of 2021).

8. The tribunal considered the objections officer had provided an appropriate response to equalising the parents’ contributions to the child’s education costs and the child’s special needs, which is over and above the child support liability determined by the administrative assessment of child support. 

9. The tribunal decided to reduce the mother’s increased liability from $3,571 to $3,086 to accommodate the 50% of the $970 she pays in respect of the child’s private health insurance.

Income, earning capacity, property and financial resources of the parents

1. The tribunal’s analysis about the parents’ capacity to pay child support is shaped by cases dealt with in the Family Court, including Carey and Carey [1994] FamCA 74; (1994) FLC 92-489 where it was noted at paragraph 17:

   The aim of the legislation is to avoid the necessity of litigation and to make the amount to be paid predictable and readily assessable. The legislation however realises that, whilst the simplest method of calculating child support is to use existing taxation records, the use of taxable income as the sole basis for child support could lead to some inequities and injustices. For a start, the financial position of many members of the community is not accurately reflected in their taxable income; either they manage to evade or avoid their taxation liabilities or they can so structure their affairs so that they are capital rich and income poor.

43.The Guide at chapter 2.6 deals with changing assessments in special circumstances and subchapter 2.6.14 deals with parents’ income, property and financial resources. In part, the subchapter sets out:

Although a parent’s most recent taxable income is used in the child support formula, the Registrar can look beyond the parent’s taxable income when considering an application for a change of assessment. Income, earning capacity, property and financial resources which do not necessarily form part of a parent’s taxable income can be added to or excluded from a child support assessment (Carey and Carey (1994) FLC 92-489).

The mother’s income, earning capacity, property and financial resources

1. The mother told the tribunal she is controller of the Tatro Family Trust (the trust) which trades as [Company 1] (the real estate business) through Tatro Management Services Pty Ltd.

2. The mother’s 2019/2020 individual tax return declared a trust distribution of $70,339. The mother’s contention is that her ATI should be set at that amount rather than at $78,318 (which is the ATI determined by the Agency’s objections officer for the mother from 1 July 2020 to 30 June 2021) of $104,818 in the 2019/2020 financial year.

3. The trust’s income for 2019/2020 was considered by the objections officer. In the absence of a 2019/2020 income tax assessment, the objections officer set out:

   Ms Tatro has not lodged her 2019-2020 tax return yet. However, based on her sales figures for the 2019-2020 year of $253 932, her income after GST is $230 847. Applying the same 43% of her declared income as the previous year, Ms Tatro’s 2019-2020 income will be in the vicinity of $99 264.

4. The trust’s 2019/2020 tax return set out income of $243,337 ($242,743 in 2018/2019), total expenses of $138,238 ($117,871 in 2018/2019) and a declared net income of $105,139 ($104,872 in 2018/2019).

5. Expense items included depreciation expenses ($49,069), and all other expenses ($67,946). Distributions were made to the mother ($70,399) and to the mother’s parents ($17,400 to each of the mother’s parents). Motor vehicle expenses ($4,967) and car finance ($7,748) totalling about $12,714 per annum (about $245 per week).  The mother’s accountant advised the mother the vehicle [has] been fully depreciated to nil. The mother said the distributions to her parents were paper transactions only.

1. The tribunal concluded the income for child support purposes available to the mother in 2019/2020 exceeded the amount of $70,399 she chose to receive by way of distribution. The tribunal concluded the profit of the trust ($105,139) and a percentage of the money recorded as an expense for depreciation were available to the mother.

2. The objections officer set out their reasoning for setting the mother’s ATI at $78,318 for the 2020/2021 financial year:

   Ms Tatro is currently assessed on her Job Keeper payments of $3000 per month. The difficulty here is that I have no information yet in regards to Ms Tatro’s BAS for the first quarter of the 2020-2021 financial year. Her website shows two properties currently listed for sale, however I also note that the Real Estate industry has been impacted by the Stage 4 lockdown in Victoria. I consider it is likely that Ms Tatro has had minimal income from her business in the last quarter, and for this reason.

   However, I also note that according to the two most recent sales on her website one was sold in June 2020 and another in September 2020. Ms Tatro would also receive some income from her rental property roll.

   Whilst I accept that Ms Tatro’s income has likely reduced in the current financial year, I am not satisfied that her estimate is a true reflection of her income and it is difficult as she is self-employed for this estimate to continually be reconciled throughout the year.

   Therefore, I intend to calculate an income for her for the financial year and I will assume an income based on three quarters of her usual income. If I assume that Ms Tatro’s income for the first quarter of 2020-2021 financial year was limited to Jobseeker then her income would be $9000 for the first quarter. For the remaining three quarters of the year I will base her income on the average of the 2019-2020 year which will give her business income for the year of $173 135 ($230 847 x 75%). Therefore, her business income will be $182 135 and allowing for her usual expenses her income will be $78 318.

3. The objections officer’s reasoning for their decision was clear: the objections officer presumed a downturn in the mother’s income in 2020/2021, and that the decision to set her ATI at $78,318 was predicated on that downturn.

4. The applicant provided a document entitled ‘management report’ for her real estate business dated 21 December 2020. The report set out that year to date sales to 31 December 2020 were $110,226. That is, at that time it was reasonable to anticipate an annual gross income of $220,500 (down on the previous two financial years).

5. However, the mother advised the tribunal she had sold the business in February 2021 for about $260,000 and that since then her income has relied solely on sales. The accountant advised the mother that she and the mother ‘need to discuss capital gains on the sale of the business and which small business toll over relief you are able to apply’.

6. The tribunal appreciates the way the sale of the business is treated will, in the absence of a further change of assessment, flow into the mother’s 2020/2021 income tax return and affect her child support liability for a subsequent child support period.

7. The post-hearing documentation provided by the mother set out that in the period from 1 January 2021, she had received sales commission totalling $31,493 and anticipated a further commission following settlement of a property on 10 May 2021. The property to be settled on 10 May 2021 sold for $1.2 million on 11 April 2021, and at a commission of between 1.5 and 2%, the tribunal estimated the mother would receive between $18,000 and $24,000.

8. The tribunal calculated in the period from 1 January 2021 to 30 June 2021, the mother’s income from commissions was between $49,493 and $55,493 (annualised $98,986 to $110,986).

9. The mother also set out that in the period after 30 June 2021, she had two more sales which were to settle on 20 August 2021 ($1.04 million) and 5 October 2021 ($620,000). The tribunal concluded the mother’s known income from commission ranged between $24,900 to $33,200). The mother said she has one further listing which the tribunal understood was likely to sell and settle prior to the mother leaving Victoria at the end of 2021.

10. The tribunal is satisfied the mother’s income in 2020/2021 has not declined to the extent anticipated by the objections officer. The tribunal concluded the mother’s ATI for 2020/2021 is appropriately based on her 2019/2020 ATI of $105,139.

11. The father did not challenge the objections officer’s decision about the mother’s ATI. He explained he became concerned when the mother attempted to estimate an income of about $30,000.

12. The father generally contended the mother disguised her income to reduce the amount of child support she was required to pay.  

13. The father did not assert the mother had unexercised earning capacity.

14. The tribunal is satisfied the mother’s income for child support purposes for the period 1 July 2020 to 30 June 2021 is reasonably set at $105,139. 

The father’s income, earning capacity, property and financial resources

1. The father is a PAYG income earner and the Agency’s objections officer recorded that his tax returns are up to date.

2. The father’s contribution to his daughter’s child support is determined according to the child support formula based on his previous financial year’s ATI. The father’s Statement of Financial Circumstances (SoFC) recorded he had received a salary increase. The father’s salary increase will be factored into the child support formula in due course.

3. The father said he worked full-time and did not have another source of income.

4. The father said he has received a raise in his salary. The tribunal is satisfied the father’s raise will be reflected in his future tax returns and affect subsequent assessments.

5. The father said he benefited from employment because his employer provided a vehicle to him and he also had use of a business telephone for private use.

6. The tribunal decided to increase the father’s ATI by $10,000 taking account of the benefits he received in addition to his income. The figure is based on attributing the father with an additional income of $180 per week in respect of private vehicle usage and about $30 per week for the use of the business phone for personal use.

7. The tribunal does not intend to amend the assessment to take account of the mother’s belief that the father has an income source that is not declared through his employment.

8. The mother said she believed the father had unexercised earning capacity.

9. Subsection 117(7B) of the Act provides that the court may determine a parent’s earning capacity is greater than is reflected in their income for the purposes of the Act if satisfied that:

   (a)  one or more of the following applies:

   (i)  the parent does not work despite ample opportunity to do so;

   (ii)  the parent has reduced the number of hours per week of his or her employment or other work below the normal number of hours per week that constitutes full-time work for the occupation or industry in which the parent is employed or otherwise engaged;

   (iii)  the parent has changed his or her occupation, industry or working pattern; and

   (b)  the parent’s decision not to work, to reduce the number of hours, or to change his or her occupation, industry or working pattern, is not justified on the basis of:

   (i)  the parent’s caring responsibilities; or

   (ii)  the parent’s state of health; and

   (c)  the parent has not demonstrated that it was not a major purpose of that decision to affect the administrative assessment of child support in relation to the child.

10. The father works full-time for his employer. The tribunal is satisfied that in the terms of the Act he does not have unexercised earning capacity.

The commitments of each parent who is a party to the proceeding that are necessary to enable the parent to support: (i) himself or herself; or (ii) any other child or another person that the person has a duty to maintain

1. The mother has a daughter for whom she receives child support. The mother told the tribunal her daughter does not have special needs. The child support formula also makes an allowance for costs associated with the daughter. The tribunal does not intend to further amend the administrative assessment to accommodate the child for whom the mother has responsibility.

Hardship resulting from the departure determination

74.The tribunal is required to consider hardship that would be caused to the child, the carer entitled to child support, to the liable parent and the child or people the liable parent has a duty to support.

75.The tribunal is intending to increase the mother’s ATI to $105,139 for the 2020/2021 financial year (based on the trust’s profit) and to increase her liability by $3,086 (taking into account 50% of the child’s school fees, orthodontic costs and private health insurance). The tribunal estimates the approximate liability for the mother in the 2020/2021 financial year will be $14,765. This decision would increase the liability for the mother in the 2020/2021 year on what was determined by the objections officer by about $2,500 per annum.

76.The father did not contend he would suffer hardship if the tribunal affirmed the Agency’s decision or changed it. The father’s attitude to the hearing was that the mother was wasting time and that she derived substantial income from her business.

77.The mother’s SoFC dated 16 December 2021 [sic] (the tribunal understood the date was intended to be 2020) she set out her total average income as $1,363.34 ($70,876 per annum), the value of property owned at $875,000, her liabilities to be $706,824.16 and her total personal expenditure to be $3,226.

1. The statement was completed in a way which made it difficult to interpret. For example, the mother set out an estimate of her average weekly income from salary or wages before tax at $2,019.23 ($105,000 per annum) and her estimated income from her business as $1,346 ($69,992 per annum) and her total weekly income as $1,363 ($70,876 per annum).

2. The mother’s SoFC listed a motor [vehicle] and in her SoFC as an expense ($274.84 per week).

3. The tribunal concluded the mother’s personal and business expenses had probably been interchangeable in the period she owned the real estate business (through the trust).

4. It was only after the tribunal put a direct question to the mother that she said she had sold the real estate business for about $259,000 in February 2021. The father also pointed out that the mother had completed house renovations for about $150,000. The mother said she had completed renovations so she could receive a better price for the house when she sold it so she could move to [State 1] to be near her parents.

5. The tribunal is satisfied neither parent nor the child nor the mother’s other daughter will experience hardship if the determination as it is set by the objections officer remains in place.

Other matters

1. When the mother lodged her application for a review of the Agency’s decision on 25 November 2020, she stated ‘I have had to sell my business’. When the applicant lodged her SoFC on 16 December 2020 (misdated to 2021) she set out she was employed by her real estate business which she owned 100%.

2. The mother responded to the tribunal’s show cause notice in April 2021. She provided documents (A60–A151). She did not provide information that the sale of her business had been completed, which at hearing she said had been settled in February 2021, for $259,000. It was then she said she was no longer the proprietor of the real estate business but had been retained as a [staff].

3. The tribunal explained at the outset of the hearing it was open to it to draw an adverse inference about her financial situation because of her failure to provide the relevant financial information, as she had been directed (Humphries  & Berry (SSAT Appeal) [2008] FMCAfam 409) (Humphries).

4. The tribunal appreciated the father’s frustration with the process and the mother’s failure to provide a full, frank and timely disclosure of her financial affairs.

5. The tribunal notes the mother is a professional woman used to dealing with complex legal documents.

6. The tribunal accepted the mother has experienced ill health. It did not draw adverse inferences about her financial situation as it could have done. However, the tribunal has made a record of its consideration of Humphries because it is likely further departure applications will be made and it is important the mother complies with the tribunal’s directions in a timely manner.

What determination should be made taking into account the above factors?

1. For the reasons set out above the tribunal intends to vary the parents’ ATIs for the period 1 July 2020 to 30 September 2021, such that, Miss Tatro’s ATI is varied to $105,139 and Mr Arterton’s ATI is varied to $80,648 and that Miss Tatro’s child support liability is increased by $3,048 in respect of the child’s education, orthodontic and private health insurance costs.

2. The tribunal notes that it is likely there will be a further change of assessment application because the child’s school fees for 2022 have not been considered and because the mother’s circumstances will change if she relocates from Victoria to [State 1] at the end of 2021.

Issue 3: Is it otherwise proper to depart from the administrative assessment?

1. The tribunal considered the impact of its decision on the balance of support provided by the parents on one hand and the taxpayer on the other. It is necessary to decide whether this is a proper outcome given that parents have the primary responsibility to support their children.

2. In this case the father receives family tax benefit for the child. This decision will not result in an increase in the amount of family tax benefit he receives.

3. The tribunal was therefore satisfied that this decision is otherwise proper in the circumstances of the case.

DECISION

The tribunal sets aside the decision under review and substitutes its Decision that:

• for the period 1 July 2020 to 30 September 2021, Miss Tatro’s adjusted taxable income is varied to $105,139 and Mr Arterton’s adjusted taxable income is varied to $80,648;

• in the period 1 October 2020 to 30 September 2021, the annual rate of child support payable by the mother is increased by $3,048.