Deputy Upper Tribunal Judge Rowland. Appeal against decision of First-tier Tribunal regarding the correct income figure upon which to base a Child Maintenance calculation. Appeal allowed.

Legal framework

• Decisions under the ‘2012 scheme’ are based on a payer’s ‘historic income’. Historic income is the non-resident parent’s taxable income in the last tax year for which HMRC has provided an ‘HMRC figure’ unless that parent’s ‘current income’ from employment is at least 25% lower.
• Whilst administratively convenient, such an approach does not always align with practical reality and the SoS has the power to agree to a ‘variation’ provided that in all the circumstances it would be just and equitable to do so.

Background

The initial assessment was based on F’s taxable income for 2015 /16 (£66,319.62). He applied for mandatory reconsideration and in December 2017 a new assessment was made on basis of estimated ‘current income’ of £35,500 (projections of £11,500 earned income and £24,000 unearned income). M’s application for revision was not considered until 1 June 2019. This was to her disadvantage as it was based on ‘current income’ from 2017/18 of £16,500 (earned income of £11,500 and ‘historic’ unearned income from 2016/17 of £5,000). F said he had been made redundant in November 2016 and then worked as a contractor, through a limited company in which he was sole director, employee and shareholder.

M appealed. The parties reached an agreement which was converted into a consent order. This provided for the SoS to recalculate the amount of maintenance payable from the effective date of 13.10.2017 on the basis that F’s income was £81,725 and the order recorded F’s agreement with this figure. F then sought to appeal on the basis that the taxable element of his redundancy payment should not have been included in the figure of £81,725.

The First Tier Tribunal (‘FTT’) refused permission to appeal and gave the following reasons:

• F was seeking to reargue factual issues that were not investigated by the tribunal because of the consent given by both parties to its decision on the appeal.
• F confirmed the calculation was based on his tax return prepared with the assistance of an accountant on the basis of actual income, and not his previously pessimistic projections.
• The parties agreed to matters being resolved by agreement without further exploration of F’s financial situation.
• The SoS would have had notice of the hearing and whilst not specifically consenting, would not have objected to the agreement.

F applied to the Upper Tribunal (‘UT’) for permission to appeal and asserted that his original agreement to the earnings figure was based on confusion and misunderstanding due to stress endured through other proceedings relating to child arrangements. Judge Robinson granted permission to appeal with reference to the rule that the FTT may make a consent order ‘only if it considers it appropriate’ and had arguably failed to consider or adequately consider whether it was appropriate to make such an order. She further considered it arguable that the FTT was not entitled to make a consent order without obtaining the consent of the SoS. SoS supported F’s appeal and submitted that the matter should be re-admitted to the FTT. The SoS made no other submissions about the appropriateness of the agreement reached. M opposed the appeal on the basis that the parties had agreed F’s income figure of £81,725 for CMS calculation purposes.

Decision

• Appeal allowed. It was inappropriate of the FTT to ask for, and accept, F’s concession in respect of the income calculation and the procedure was unfair to him.
• Due to length of proceedings, no remittance to FTT and F’s liability from 9 September 2017 should be based on his 2015/16 historic income of £66,319.62.