A handful of tips for parents being furloughed and wanting to understand their child support entitlements.
With schools closed and many businesses adapting their daily processes, whether that be closing down completely or making temporary arrangements where possible, for many parents, childcare has become a concern.
Many parents are now required to stay at home and look after their children full time, with no support networks or childcare services available due to the lockdown currently in place.
Some nurseries and all schools have remained open to accommodate the children whose parents or carers are considered key workers. A definitive list includes NHS workers, delivery drivers and supermarket workers.
However, there will be many parents who do not classify as key workers but will still be required to support their children but their current employment status may affect this.
This is because many workers have been placed on furlough and this is where there can be a discrepancy on how a parent may financially support their child.
Furlough is the process where employees are kept on the payroll but are unable to do their jobs, with 80 per cent of their salary being paid by the government. The scheme, set up by the government, has ensured job security for many employees across the country to avoid mass redundancies.
As the UK enters into week five of lockdown, there is still plenty of uncertainty about the future.
If you and/or your partner have been furloughed or have taken a pay decrease and are concerned about child maintenance, Hawkins Family Law shares a series of useful tips for those looking to understand their child support entitlements at this time.
What are child maintenance payments?
Child Maintenance payments refer to the scheme in place for separated parents, in reference to childcare and financial support.
Legally speaking, both parents are responsible for the financial costs of raising a child. In cases where a couple are separated and one parent is not the primary caregiver and does not live with the child in question full time, then that parent may have to pay money to the parent or person looking after the child. This is referred to as child maintenance or occasionally child support.
Child maintenance payments will involve regular financial payments towards a child’s every day costs. These may be paid in regular instalments.
How is child maintenance is arranged?
Depending on circumstances, child maintenance can be arranged personally between the two parents of the child.
A family-based arrangement can often be a preferred management method, saving time, administrative processes and any unnecessary upset or upheaval to the children and their everyday lives.
It is advised to come to an agreement between both parents if you are able to, where a process is formally agreed before being put in writing.
Despite this, a family arrangement is not legally binding so should you want to formalise any additional details in your agreement, a family lawyer can help support on any further issues.
Meanwhile, there are some cases where a relaxed agreement may not be possible. This may be in cases of a separation which hasn’t ended amicably, where both parents have little to no contact, for example.
In this instance, separated parents can utilise the Child Maintenance Scheme which came into place in 2012. Separated parents can follow government processes to arrange the specific details of their Child Maintenance and how it will apply to their situation.
Child maintenance and benefits
Child Maintenance does not affect the benefits an individual will receive. In the case of paying child maintenance, an amount is taken out per week of your benefits estimated at £7 a week.
Child maintenance and tax
There is no tax relief on payments made in child maintenance. Additionally, if you receive child maintenance you do not pay tax on the money you receive.
If I’m furloughed can I reduce my child maintenance payment?
If you have been furloughed, by law, you still need to pay child maintenance. The Child Maintenance Scheme does allow for flexibility in some cases but only if the below applies:
- A change in circumstances review finds that the change results in a 25 per cent tolerance (ie, your income has reduced by 25 per cent).
- The Government is informed of this change within 14 days.
If you are self-employed, you do not need to inform the government of your change in circumstances.
Under furlough, child maintenance payments are not automatically re-calculated under current regulations. The Child Maintenance Scheme would be entirely overwhelmed from an administrative point of view if cases were reviewed singularly. Attempting to negotiate such a vast number of individual cases is not a feasible solution.
The Department for Work and Pensions has stated that in some extreme cases the payments in place can be reviewed and temporarily lowered. However, parents who look to take advantage of or abuse the system during such unprecedented times will be subject to enforcement powers.
Parents paying child maintenance need to continue making payments as normal during lockdown.
If your ex-partner is still receiving full pay, they must continue to make payments.
Parents should contact the CMS if they are struggling, or if your income has reduced by 25 per cent.
In addition to enforcing powers should the system be abused, the Child Maintenance Scheme can respond if payments aren’t made by:
- Deducing cash directly from your earnings
- Serving you a liability order demanding money
What are my entitlements if I haven’t been furloughed?
Employees who are unable to work because they have caring responsibilities resulting from coronavirus can be furloughed; this may apply to a family where they are unable to find alternative arrangements for childcare. In this case, however, the employer must agree to furlough.
By law, there are initiatives in place for employees who need to take time off work to support their children due to an unforeseen circumstance, of which coronavirus would be applicable. This is known as dependent leave, however, traditionally there is no legal instruction to pay employees under dependent leave.
There is no cap to the amount of time taken, however, it is described as a ‘reasonable amount.’ Referring to Coronavirus, the Government is yet to confirm what amount of time is considered or defined as ‘reasonable’. This is under active review currently.
What if I use the Child Maintenance Service and have been furloughed or have had a change in circumstances?
If you have been furloughed and there is a change in your circumstances you should try to come to an agreement with your ex-partner. Communication and understanding is vital and both parents should consider coming to an informal agreement to handle the matter sensitively and efficiently.
However, should your change in circumstances require legal assistance, then contacting a family lawyer or family adviser can help two ex-partners find a resolution.