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  • FIRST POST
    • strikesy
    • By strikesy 12th Sep 16, 8:24 AM
    • 27Posts
    • 3Thanks
    strikesy
    CMS - Annual Review Figure Too High
    • #1
    • 12th Sep 16, 8:24 AM
    CMS - Annual Review Figure Too High 12th Sep 16 at 8:24 AM
    Morning,

    I wonder if anyone has had any issues with the CMS when paying too much and if there has been any success in reviewing the amount they have had to pay and what they have had to do?

    I have just received my annual review letter, which has seen a significant increase in what I am supposed to pay each month, so I checked their figures to see why this was. What I learnt is that since their involvement 3 years ago I have paid too much every year.

    The first two years I didnt actually notice, because when my ex decided to involve them it actually reduced the figure we had agreed between ourselves, so I was paying less than I previously had done. The 2nd year saw an increase in the amount I pay, but I had been promoted, so expected the rigure to rise, but this year there has been no changes with regards to my income, yet my rate has gone up significantly.

    On looking into it the issue has been with the HMRC reporting some overtime earnings from the previous year, for a service that my company no longer provides, so I can no longer earn this additional money. I called the CMS and they said that I needed to provide 2 payslips to prove that my basic rate of pay was less than the HMRC reported, which I did. I also realised that my pension contributions had never been taken into account when calculating my basic pay, so I highlighted this also.

    I was told that no action can be taken for previous years mistakes, but worse than that, unless their calculations were wrong by 25%, they are unlikely to review the amount that I am required to pay. I received a 2nd letter stating that the payments set out in my initial letter are going to be in effect for the next year, which seems to be because they have only miscalcuated by 14%.

    How can this be right? I could understand if I had pointed this out after the payments had started, but even though I have highlighted this before this new payment is due to commence they refuse to take any action. They know I have overpaid the past 2 years, they know I am overpaying an even higher amount this year, but because they havent made a big enough mistake with their calculations there is nothing I can do? Has anyone got any advice with regards to this, because this cannot be right? And seemingly there is nothing to stop them being wrong next year and every year until my child is no longer eligible.

    Any advice would be welcome, and thanks in advance
Page 1
    • DUTR
    • By DUTR 12th Sep 16, 9:25 AM
    • 10,610 Posts
    • 6,006 Thanks
    DUTR
    • #2
    • 12th Sep 16, 9:25 AM
    • #2
    • 12th Sep 16, 9:25 AM
    IIUC pension contributions are not considered on CMS as it is based on gross not net.
    • strikesy
    • By strikesy 12th Sep 16, 10:02 AM
    • 27 Posts
    • 3 Thanks
    strikesy
    • #3
    • 12th Sep 16, 10:02 AM
    • #3
    • 12th Sep 16, 10:02 AM
    On the letter it states my gross weekly income figure and then says...

    This is your income before income tax and national insurance contributions but after any occupational or private pension scheme contributions are made from your salary.

    I took that to mean that my pension contributions should be deducted?
    • DUTR
    • By DUTR 12th Sep 16, 10:18 AM
    • 10,610 Posts
    • 6,006 Thanks
    DUTR
    • #4
    • 12th Sep 16, 10:18 AM
    • #4
    • 12th Sep 16, 10:18 AM
    On the letter it states my gross weekly income figure and then says...

    This is your income before income tax and national insurance contributions but after any occupational or private pension scheme contributions are made from your salary.

    I took that to mean that my pension contributions should be deducted?
    Originally posted by strikesy
    That is not how I see it, gross is gross and is the figure before any deductions.
    • strikesy
    • By strikesy 12th Sep 16, 10:23 AM
    • 27 Posts
    • 3 Thanks
    strikesy
    • #5
    • 12th Sep 16, 10:23 AM
    • #5
    • 12th Sep 16, 10:23 AM
    When I called them, before I wrote my letter asking for a review, it was the advisor who stated that pension contributions do not count, at which point I asked about the excess I had paid in previous years and was told that it was too late for any action over past payments.
    • Guest101
    • By Guest101 12th Sep 16, 5:07 PM
    • 11,958 Posts
    • 11,408 Thanks
    Guest101
    • #6
    • 12th Sep 16, 5:07 PM
    • #6
    • 12th Sep 16, 5:07 PM
    Pension contributions are deducted and then the % is worked out
    • jimd-f
    • By jimd-f 17th Sep 16, 9:07 AM
    • 106 Posts
    • 41 Thanks
    jimd-f
    • #7
    • 17th Sep 16, 9:07 AM
    • #7
    • 17th Sep 16, 9:07 AM
    the gross figure that CMS get from HMRC is your total gross income for the last tax year, including overtime and bonuses, less any contributions that you make through your wages for your pension.
    that is the figure CMS will use to calculate this years assessment.
    to get them to change this to what is called current income you must prove that your gross current income is more than 25% less than the gross HMRC income.
    this is not a miscalculation but the way the law is written.
    • strikesy
    • By strikesy 17th Sep 16, 9:29 AM
    • 27 Posts
    • 3 Thanks
    strikesy
    • #8
    • 17th Sep 16, 9:29 AM
    • #8
    • 17th Sep 16, 9:29 AM
    I understand that and if I would be earning the same wage this year there wouldn't be an issue, also maybe if I hadnt been overcharged every year since their involvement...

    Essentially I am doing a job with a reduced responsibility and a reduced income. Pointing this out before a payment starts and providing proof should result in changes, without a need for it to be a difference of 25%, which is huge.
    • DUTR
    • By DUTR 17th Sep 16, 10:31 AM
    • 10,610 Posts
    • 6,006 Thanks
    DUTR
    • #9
    • 17th Sep 16, 10:31 AM
    • #9
    • 17th Sep 16, 10:31 AM
    I understand that and if I would be earning the same wage this year there wouldn't be an issue, also maybe if I hadnt been overcharged every year since their involvement...

    Essentially I am doing a job with a reduced responsibility and a reduced income. Pointing this out before a payment starts and providing proof should result in changes, without a need for it to be a difference of 25%, which is huge.
    Originally posted by strikesy
    25% are the rules though, if you salary hasn't changed by 25% then you have little argument.
    • jondav
    • By jondav 19th Sep 16, 9:12 AM
    • 298 Posts
    • 132 Thanks
    jondav
    That is not how I see it, gross is gross and is the figure before any deductions.
    Originally posted by DUTR

    This is incorrect. CMS payments are worked out AFTER any pension deductions, they state that tax and NI are factored into their calculations and so are not considered, but pension contributions are.
    • DUTR
    • By DUTR 19th Sep 16, 9:27 AM
    • 10,610 Posts
    • 6,006 Thanks
    DUTR
    This is incorrect. CMS payments are worked out AFTER any pension deductions, they state that tax and NI are factored into their calculations and so are not considered, but pension contributions are.
    Originally posted by jondav
    It has changed then, as when CMS was introduced one of the things was to get around the extra pension contribution loophole to reduce liability, that doesn't change what gross pay is, in the past it was 9% gross for one child compared with 15% with CSA
    It makes sense now that some PWCs were informing their contributions recieved have reduced since moving to CMS from CSA.
    • jondav
    • By jondav 19th Sep 16, 12:58 PM
    • 298 Posts
    • 132 Thanks
    jondav
    It has changed then, as when CMS was introduced one of the things was to get around the extra pension contribution loophole to reduce liability, that doesn't change what gross pay is, in the past it was 9% gross for one child compared with 15% with CSA
    It makes sense now that some PWCs were informing their contributions recieved have reduced since moving to CMS from CSA.
    Originally posted by DUTR

    There was no involvement with the CSA in our case, a new case was opened under CMS so I don't know about how it worked previously, but pension is definitely factored in under CMS rules, tax and NI aren't.
    • GudDad
    • By GudDad 10th Oct 16, 8:55 PM
    • 1 Posts
    • 0 Thanks
    GudDad
    New CMS case
    My ex has just got the CMS involved after 10 years of CSA. I haven't made a payment yet as the case is just being established but they are stating that the bench mark figure they are using to start the case is my P60 gross income from March. My salary and pension have changed this tax year and the payslips I've provided prove this but they are quoting the 25% threshold. My pension only changed because of the government enforced changes on company pension schemes meaning my contributions increased by £90 a month.
    How can a brand new case be set up and bench marked against information that is 7 months out of date. My gross also included 5k of benefit in kind which is a figure used for the tax on my jobs need company car.. it's not money I receive, surely this can't be included in the calculation?
    As it stands, the figure they are quoting is 19.4% of my current gross, 27% of my NETT... This is crazy, how are they getting away with such an imbalanced, inaccurate and unfair system.
    I'm appealing this as far up as I can.
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