Whiffen and Woolery (Child support)

[2023] AATA 3737

Whiffen and Woolery (Child support) [2023] AATA 3737 (4 October 2023)

DIVISION:Social Services & Child Support Division

REVIEW NUMBER:  2023/BC026110

APPLICANT:  Miss Whiffen

OTHER PARTIES:  Child Support Registrar

Mr Woolery

TRIBUNAL:Member S Letch

DECISION DATE:  4 October 2023

DECISION:

The Tribunal sets aside the decision under review and, in substitution, decides that, pursuant to section 63AA of the Child Support (Assessment) Act1989, the Registrar ought to have refused to accept Mr Woolery’s estimate election for the 2022/23 financial year of “$0” made on 19 October 2022. This means the application is successful.

CATCHWORDS

CHILD SUPPORT – particulars of the administrative assessment – estimate of income - whether the estimated income is less than the amount likely to be the actual income - estimate of income ought to be refused - 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

1. This matter concerns a decision by Child Support to accept a “nil” estimate election made by Mr Woolery on 19 October 2022 in respect of the 2022/23 financial year.

2. It is convenient by way of background to set out some extracts from the objections officer’s decision dated 19 April 2023:

   WE CONSIDERED THE FOLLOWING EVIDENCE IN THE DECISION

   [Ms Whiffen] and [Mr Woolery] have had a registered child support assessment for [Child 1] since 13 September
   2022.

   On 19 October 2023, [Mr Woolery] reported a change to his income and lodged an income estimate of $0 for the 2022/2023 financial year.

   On the same day, we accepted [Mr Woolery’s] 2022/2023 estimate of adjusted taxable income of $0.00
   (annualised) for the period 19 October 2022 to 30 June 2023.

   Letters were issued to both parties advising of our decision and their objection rights.

   On 25 February 2023, [Ms Whiffen] lodged an objection to this decision. [Ms Whiffen] provided the following
   Grounds for her objection: I object that [Mr Woolery] is on $0 estimate. [Mr Woolery] is employed at [Employer 1], he is a ‘FIFO’. He leaves [Child 1] at his sisters in her care. The school [named] has confirmed that.

   We unsuccessfully attempted to contact [Mr Woolery] to discuss [Ms Whiffen’s] objection.

   On 27 February 2023, we issued a letter to [Mr Woolery] with a copy of the objection information, and
   advised he will have up to 28 days to respond. After this date, we will make a decision based on the information on hand.

   We had no further response from either party.

   REASONS FOR THE DECISION

   Child Support will consider all the circumstances and may obtain further information, either from
   the parent or a third party (e.g. an employer or an overseas authority), in making the decision as to whether to refuse to accept the income election (CSA Act section 63AA(4)).

   We conducted searches with the Australian Taxation Office (ATO) and we could not find any

   evidence to dispute [Mr Woolery’s] estimate for the date of event of 19 October 2022.

   …

   We have not found any information to determine that [Mr Woolery’s] income estimate of $0 (annualised)

   is incorrect on 19 October 2022.

   On review, we have made the decision to accept [Mr Woolery’s] 2022/2023 estimate of adjusted taxable

   income of $0.00 (annualised) for the period 19 October 2022 to 30 June 2023.

   The objection is disallowed.

   Once [Mr Woolery’s] taxable income for the 2022-2023 financial year is received, we will reconcile the
   estimate against the taxable income to ensure the estimated income is correct. If [Mr Woolery’s] taxable
   income is less than the estimated income there will be no overpayment created, if [Mr Woolery’s] taxable income is higher, we will raise arrears for the difference in amounts which will be payable to [Ms Whiffen].

   Parents can apply to have their assessment changed if their special circumstances are not adequately reflected in their child support assessment. An application to change your assessment (special circumstances) must be lodged on the approved Application to Change Your Assessment in Special Circumstances form, signed and lodged by either mail, fax or electronically. This form can be accessed at servicesaustralia.gov.au.

3. Mr Woolery did not answer the Tribunal’s repeated attempts to call him at the time of the scheduled hearing. He did not contact the Tribunal at any time following the hearing. Miss Whiffen participated in the hearing by conference telephone.

4. In summary, Miss Whiffen told the Tribunal that Mr Woolery is a “FIFO” worker who [performs a specified role] in [industry 1]. She separated from him over 13 years ago. She told the Tribunal she has suffered from domestic violence and abuse. She understands Mr Woolery travels to many jobs around the country; he is presently working in Western Australia. Her daughter’s school has confirmed with her that in October 2022 they had recorded that Mr Woolery was working for “[Employer 2]” in [Queensland]. She said she is on limited income of some $34,000 per annum and needs assistance to support [Child 1].

5. The pivotal provision in this application is section 63AA of the Child Support (Assessment) Act1989:

   63AA  Registrar may refuse to accept an income election

   (1)   If:

   (a)a parent makes an income election to which subsection 60(2) applies; and

   (b)the Registrar is satisfied that the amount worked out under that subsection is less than the amount that the Registrar considers is likely to be the parent’s actual adjusted taxable income for the year of income to which the income election relates;

   the Registrar may refuse to accept the income election.

   (2)   The Registrar may refuse to accept a parent’s income election to which subsection 60(3) applies if the Registrar is satisfied that:

   (a)the partial year income amount for the income election is less than the amount that the Registrar considers is likely to be the parent’s actual adjusted taxable income for the remaining period in relation to the income election; or

   (b)the total of the income component amounts estimated by the parent under paragraph 60(3)(b) for the period referred to in that paragraph is more than the amount that the Registrar considers is likely to be the total of the actual income component amounts for the parent for that period.

   (3)   If:

   (a)a parent makes an election under subsection 62A(1); and

   (b)the Registrar is satisfied that the partial year income amount for the income election is less than the amount that the Registrar considers is likely to be the parent’s actual adjusted taxable income for the remaining period in relation to the income election;

   the Registrar may refuse to accept the income election.

   (4)   In making the decision as to whether to refuse to accept the income election, the Registrar:

   (a)may act on the basis of information that the Registrar has received or obtained as to the financial circumstances of the parent; and

   (b)may, but is not required to, conduct an inquiry into the matter.

   (5)   Except for the purposes of Parts VII, VIIA and VIII of the Registration and Collection Act (dealing with objections and appeals), if the Registrar refuses to accept the income election, the election is taken never to have been made.

6. In short, the Registrar may refuse to accept an income election if the estimated amount is less than the amount that the Registrar considers is likely to be the parent’s actual adjusted taxable income for the year of income to which the income election relates.

7. Here, the Child Support hearing papers reveal that Mr Woolery has not engaged with Child Support despite its many attempts to engage with him. Mr Woolery did not respond to the objections officer; Mr Woolery has not engaged in any way with the Tribunal. Engagement by Mr Woolery in these proceedings would have provided the opportunity for him to provide sworn evidence about the circumstances at the time he made the estimate election, and would have allowed the Tribunal to form a more considered view about whether it was likely Mr Woolery’s actual adjusted taxable income for 2022/23 for the balance of the year was likely to be higher than “nil”.

8. I must make the decision on the evidence I have before me. As a general observation, it is not desirable for a party to be advantaged by a failure to participate in the decision-making process, or indeed proceedings before the Tribunal.

9. The evidence I have is that it appears that a “replaced estimate” has been substituted for the period January to June 2023, suggesting Mr Woolery may have advised Child Support of employment income for that period, or that Child Support came to be aware of a change in his circumstances (see folio 94 of the (heavily redacted) Child Support hearing papers). There is no file note of any recorded conversation with Mr Woolery to that end. However, I deduce that it is most likely Mr Woolery secured work within a few months after he made the estimate election in October 2022.

10. In the absence of contrary evidence, I accept Miss Whiffen’s evidence that Mr Woolery [performs a specified role] in [industry 1], and has held a variety of jobs in a variety of places around Australia. Miss Whiffen suggests he would ordinarily earn around $130,000 per year (consistent with Mr Woolery’s 2020/21 taxable income). I consider it very likely that his skills and experience would place him in very high demand. I consider if he was genuinely seeking employment (and it appears he was given it seems he secured some form of employment within a few months of October 2022) that it would be very unlikely that he would have a “nil” income for the remainder of the 2022/23 financial year.

11. Accordingly, doing the best I can with the evidence available to me, I find that the Registrar ought to have refused to accept the estimate election made on 19 October 2022. As this is a different conclusion to the objections officer, the decision under review will be set aside.

12. I note that subsequent estimate elections have been made which, as I explained to Miss Whiffen during the hearing, are not the subject of this review. Miss Whiffen is, of course, at liberty to object to any later determinations. Without casting any dispersions upon Mr Woolery who I have not had the opportunity to hear from, I think it fair to observe generally that the income estimate regime lends itself to manipulation of child support assessments by actors not acting entirely in good faith – and I note reserves of good faith are often exhausted in situations involving years of sometimes highly acrimonious discourse over family law and child support issues. I note that Child Support has advised Miss Whiffen she may apply for a “change of assessment” (which “overrides” the formula, including removing the capacity for estimate elections to be made where a departure is made varying a person’s adjusted taxable income); I note it is common for such applications to be made following “nil estimate elections”. In suitable cases, an assessment can be “smoothed out” for want of a better term. It is a matter entirely for Miss Whiffen; however, she may secure a preferable assessment from her perspective by pursuing that course. I should note that Mr Woolery is also at liberty to make such an application which, in suitable circumstances, can be given retrospective effect for up to 18 months prior to the application being made.

DECISION

The Tribunal sets aside the decision under review and, in substitution, decides that, pursuant to section 63AA of the Child Support (Assessment) Act1989, the Registrar ought to have refused to accept Mr Woolery’s estimate election for the 2022/23 financial year of “$0” made on 19 October 2022. This means the application is successful.