Child Maintenance claims against High Earners
If you are not married and separated from the other parent, you may be entitled to child maintenance.
This article follows on from guide 1 that covered the difference between spousal and child maintenance, and guide 2 which addressed the Child Maintenance Service (CMS) and the processes around making a claim.
In this guide 3, we address questions around child maintenance claims against those who are considered ‘high earners’, earning more than £3,000 gross per week or £156,000 gross per annum.
What if the income exceeds the CMS threshold?
If the gross income of the paying party is over £3,000 per week (or £156,000 per year), the CMS will make their maximum assessment up to that amount. To make a top-up child maintenance order, an application could then be made to court. The court will decide whether a top up maintenance order should be made. The sum awarded will be decided by taking into consideration the different circumstances of the case.
When will the court make a top-up order?
A top-up order can be made by the court in circumstances where:
- The maximum assessment has been made by the CMS
- The gross income of the non-resident parent is greater than the CMS threshold
- The court is satisfied that, in the circumstances of the case, ordering extra payments is suitable
Nevertheless, under Schedule 1 of the Children Act 1989 the court can also take into account an application for financial needs of a child which are not limited to maintenance. It is within the court’s power to order a lump sum for the child, or the settlement or transfer of property if it is for the child’s benefit. Please read our further articles on Schedule 1 claims.
Top-up awards made by the court (s.8(6) Child Support Act 1991)
As a starting point, the court’s most common approach has been to apply the CMS calculation on incomes that are between £156,000 and £650,000, without the cap. The judge may then order the payment above the calculated figure, if appropriate in the circumstances. The CMS formula (without the cap) should be the starting point. In the event that the non-resident parent has an income more than £650,000 per annum, the CMS calculation still ought to be applied without the cap as a starting point, but there is more freedom for the court to order a higher level of maintenance.
Examples of when a court may depart from the calculation are:
- The primary carer of the child has a high income;
- The payment is not in line with the child’s budget; or
- Departure is needed for the welfare of the child.
The case of CB v KB [2019] EWFC 78 [49] concerned a 19-year marriage, including cohabitation. The parties had six children. The husband was a member of a successful band, whilst the wife had not worked during the marriage. The husband was ordered to pay child support at the rate of £12,600 per annum in respect of the four minor children living with the wife until each child completed tertiary education. He was also ordered to pay the children’s school fees.
In this case, Mostyn J gave his opinion as to the correct approach in relation to parties claiming maintenance from high earners:
“I suggest that in every case where the gross annual income of the non-resident parent does not exceed £650,000, the starting point should be the result of the formula ignoring the cap on annual gross income at £156,000. For gross incomes in excess of £650,000, I suggest that the result given by an income of £650,000 should be the starting point with full discretionary freedom to depart from it having regard to the scale of the excess.”
The case of G v T [2020] EWHC 1613 (Fam) followed without comment. In this case, it was decided by Nicholas Cusworth KC that the husband’s receipt of moneys from all sources over the next 3.5 years “will be employed in meeting the wife’s capital entitlement” and that an appropriate level of child maintenance was a payment of “£35,000 per annum per child of conventional duration”.
This case was then followed without comment by the case of W v H (divorce: financial remedies) [2020] EWFC B10, where it was decided by HHJ Hess, that:
“There should now be a child periodical payments top up order at the rate of £525 per month now, reducing to £420 per month from Summer 2020 and to £315 per month from Summer 2021. Again, this will carry on until Summer 2027 when C leaves school.”
This approach was then applied again by Mostyn J in the case of OG v AG [2020] EWFC 52 [101], where it was decided that:
“The reasonable gross income to attribute to the husband is £200,000 per annum. This gives rise to a liability under the formula of £19,248. The overall child support liability is therefore £26,748, which I round up to £27,000 per annum or £2,250 per month. It will continue until the conclusion of secondary education. In tertiary education it will fall to 50% of the secondary education rate”.
In addition to the maximum assessment calculated by the CMS, if the court applies this approach, the party in receipt of child maintenance would be given a percentage of the paying party’s income which is between £156,000 and £650,000.
This is merely a guideline as to the level that is suitable for child maintenance. However, it is yet to be seen whether this approach will become a rule rather than a tool for the courts when dealing with child maintenance claims against high earners.
Adjustments may be made to the level of maintenance depending on:
- The non-resident parent has additional children with a new or previous partner
- The non-resident parent has shared care of the children
It is important to note that spousal maintenance orders may also be made in addition to child maintenance orders. These payments are often made in conjunction. Please read our further guidance on:
