IPA & Child Maintenance

yorkshireman1982

“
Hello all,

I'm currently collating my information ahead of filing for insolvency. I've been examining the IPA rules and requirements and something has me extremely nervous.

I currently pay child maintenance to my ex-spouse for my two children. It's an informal agreement based on government guidelines (20% of net income) that we established when we first parted many years ago.

The rules suggest this will not be deemed a necessary expense under the IPA as my children are not living with me i.e. not dependant.

There is some ambiguity over how definite this is, could anyone clarify? Will my maintenance not be considered when calculating my IPA? I've been over the documents over and over and its just not black and white.

Does anyone have any experience of a similar concern?

Thanks in advance for your help

TheGardener

From the IS notes payments under a maintenance order or child support agency assessment may be accepted as an expense - its certainly considered an income when the BR is the recipient. However, informal agreements may be harder to justify regardless how 'reasonable' they are.
Many couples chose to have the 'flexibility' of a private maintenance agreement but this is open to abuse if the recipient of the support claims any means tested benefits. It is also possible that in theory a BR could tell the OR that they pay £x but that the BR has an arrangement with the ex that they refund you some of that amount - a way to sort of hide money from the OR - so its unlikely you will be permitted an 'informal' agreement.
It would guess your best bet is to have the agreement formalised although I appreciate that may impact negatively on your ex ...
Others may have a different view.

owlet

How do you pay the maintenance? If it's direct debit can you show a paper trail with bank statements to prove that it's historic & not something new to hide money.

yorkshireman1982

Thanks for your replies guys, our arrangement has been in place for 20% of my net income for years, and is made by standing order every month so I can clearly show a history of payments.
My ex partner is not on any benefits so it looks like to be sure ahead of time, ill have to look into formalising it!

Thanks again :-)

alastairq

My 'informal' agreement was permitted.

The OR had little choice.

It was simply, accept the status quo, or I go for a formal arrangement.....and absolutely no surplus will be found.

tigerfeet2006

Don't formalise it at the moment. In the 9 years I've been on here and the time I spent helping as a volunteer I have never seen an OR worry about a perfectly normal arrangement that is within the guidelines between parents.

debt_doctor

Hi,
Actually 20% for 2 children is pretty much in line with a formal arrangement anyway.
I note that your ex is not on benefits but it wouldn't make any difference; Means tested benefits are not affected by the parent with care receiving child support payments (formal or informal).
DD

yorkshireman1982

Sorry for delay!

Thanks so much that's really reassuring, I would indeed refuse the IPA if the OR ruled out the maintenance payments, I'm certain a judge wouldn't be as harsh!

I won't formalise anything unless i absolutely have to which at this stressful time is a relief!


Thanks again :-)