csa how much will i pay?

john_cliff

hi there i am just looking for some advice here. Myself and my ex are in the process of going through a divorce. i was contacted by the csa on friday so will no doubt get some paperwork through this week. i am currently self employed earning between 30-40k a year top line. However i only take a wage avereging £ 300 -350 per week. my child is now 7 years old and her mother is now in receipt of benifits. what things are taken into account when they asses the ammount to be paid?
Will my ex get the full amount paid or will the csa take a chunk of this for admin?

thanks alot

jc

clearingout

for one child it is 15% of your income after deductions have been made. It will be less if you have your child overnight on a regular basis - the more you have her, the more the reduction will be. Your ex will, for the time being at least, receive the exact same amount you pay. There are plans to introduce a charging system this year but it will be for new cases only in the first instance.

There is a calculator on the CSA website which will give you a better idea.

HappyMJ

Self employment causes a lot of confusion. It's based on your gross profit but if it looks like your gross profit has been reduced to take advantage then a variation can be applied for. For example a Director who takes a salary of £144 a week (the optimal amount for tax reasons) would initially be assessed on £144 then a variation would be applied for to take the dividends into account. Can you come to a private agreement?

john_cliff

i am not sure if a mutual agreement could be done however it may be worth a shot? do the csa let you explore this option? i get what you are saying about the self employment and they may be concerend about a substantial reduction in any annual income. However i am in the building trade and this is currently very unstable and does make my end of year tax returns vary from one year to the next. What you said does make sence and i was concidering going as a limited company this year for reasons out with this. I dont no if this would change any outcome of payments i will be required to pay?

thanks again
JC

HappyMJ

john_cliff wrote: »

i am not sure if a mutual agreement could be done however it may be worth a shot? do the csa let you explore this option? i get what you are saying about the self employment and they may be concerend about a substantial reduction in any annual income. However i am in the building trade and this is currently very unstable and does make my end of year tax returns vary from one year to the next. What you said does make sence and i was concidering going as a limited company this year for reasons out with this. I dont no if this would change any outcome of payments i will be required to pay?

thanks again
JC

The CSA prefer you come to your own agreement.

If you did go limited then it throws everything up in the air. You would required to pay CSA on £144 income a week or whatever your company pays you in salary/wages if lower but as you have no figures for the dividends then you would have to make an estimate of potential dividends. It will be backdated so try and make and accurate estimate as possible and if it appears to change then change your payments. It depends on how much contact you want with CSA and how willing you are to share your figures before the actual end of year accounting date. You have no obligation to but it can avoid a potentially large underpayment if you keep an eye on them constantly. It also depends on how smoothly you want the payments to go. No one wants £100 for a few weeks followed by nothing for a few weeks due to lack of work on your part. It's too uncertain so if you can agree on an average of let's say the last 26 weeks of profit then pay the CSA based on that then that would be fair. At least I think it is.. The CSA technically go on last years tax returns and annual accounts for closely held companies but that causes issues if next years income is forecast to be low when you would have to apply for a departure and you won't have company accounts for well over a year so could be underpaying by a lot.

kevin137

Stay well away from the CSA if you can, for both your sakes.

As others have said it is 15% of income, which is after tax, if you could stay on talking terms and be honest with your ex about income, then hopefully you will both benefit the problem starts when the ex becomes untrusting, and then you will both have problems with the CSA.

Ask her to read some of the horror stories on here, and try to be grown up about it is the best advice you can take from here.

To come to a private agreement you can use CMEC which is a part of the CSA but still remains a private agreement.

john_cliff

Thanks very much for the info. i will take it on board, there is quite alot to think about. you did mention that they prefer that there is an agreement between myself and my ex. how do i explore this option if they have already made contact?

thanks again

john_cliff

kevin137 wrote: »

Stay well away from the CSA if you can, for both your sakes.

As others have said it is 15% of income, which is after tax, if you could stay on talking terms and be honest with your ex about income, then hopefully you will both benefit the problem starts when the ex becomes untrusting, and then you will both have problems with the CSA.

Ask her to read some of the horror stories on here, and try to be grown up about it is the best advice you can take from here.

To come to a private agreement you can use CMEC which is a part of the CSA but still remains a private agreement.

thanks this must have posted just as i was replying to the other post. Yes this sound like a better arrangment, if we can agree???? would this benefit my ex in terms of acctual money she would receive? and how successfull are these other CMCE arrangments, are they pretty binding?

thanks

HappyMJ

john_cliff wrote: »

thanks this must have posted just as i was replying to the other post. Yes this sound like a better arrangment, if we can agree???? would this benefit my ex in terms of acctual money she would receive? and how successfull are these other CMCE arrangments, are they pretty binding?

thanks

They are not binding at all. It's trust she can either have a fight through CSA and get nothing or you both agree some reasonable figure which you can agree to change at any time.

If you tell her your income is £100 a week and you are paying £5 a week to her she'll be furious and fight for more but if you estimate your net profit to be £200 a week after tax and agree to pay £30 a week until further information is available then she might agree to it but if your net profit has always been £500 a week then she may not believe your income has dropped by so much and try and fight for more. During the time your case is registered with CSA you must stop payments (but save them) until you have been given a figure.

john_cliff

Thats great advice thanks very much for the info. When you say she could fight throught the csa and get nothing? doo they take most of what i would pay and she getts whats left?

cheers

PreludeForTimeFeelers

john_cliff wrote: »

Thats great advice thanks very much for the info. When you say she could fight throught the csa and get nothing? doo they take most of what i would pay and she getts whats left?

cheers

No, the CSA are currently entirely tax-payer funded, any child maintenance they collect from you is sent on to her.