Child Maintenance evasion

[yosemite78]

My child’s father set up his own limited company last year and claims his income has dropped from nearly 10k month to £400. What he pays in maintenance is now peanuts and not enough to provide for our child. He didn’t even forewarn me of this major change, despite knowing I was made redundant last year and I’m still unemployed. Whilst I appreciate he may not be earning the big salary he was, he wouldn’t not be doing all he is for less than minimum wage. His company has expanded twice over the past 12 months and now employs at least 4 other staff. He was always abusive and financially controlling, which is the reason I got child maintenance service involved several years ago. I feel this is his ultimate revenge on me as he has really left me up the creek. Our next review with CMS is not until next August and looking on company house, he has until next Nov to submit any accounts. Is there anything I can legally do to get him to take responsibility as I am sure he is earning way more than he has told CMS? He even had the cheek to tell me the £59 CMS figure (based on what he told them) was “ridiculous” but still continues to pay it each month! Thanks.

1. Have you applied for a variation? Unless you do, dividend income won't be taken in to account.
2. Have you asked the CMS to get his bank accounts and see how much cash he's taking from the company?

@Collaborate can I ask them to do this before the next review in August 2022? Also, do they really have the power to look at his bank statements? Knowing him, he’d provide the wrong one! I know he did not declare income from a rental property he has but I have no way of proving this. I also I know how evil he can be and if I did this I fear repercussions for our child.

@Collaborate he did not start business until February. How often would he pay dividends? He recently made another person company director too, not sure if this affects his income?

I had similar, but salary not as high. Due to long history of evasion which had involved a Liability Order and bailiffs, I requested the Fraud Team (think they are known by a politer name) become involved. CMS refused at first but I made a complaint and it was forward to the Team.

He had arrears of £5,000 as well before he got a nil liability. He had earned £60,000 the previous year and now claimed to earn less than £200 per week doing the exact same job. He was not really self employed, just a sub contractor working for one company only.

Fraud told him they were not happy with his accounts and now wanted to see all his paperwork. Something strange then happened and he agreed to clear the majority of the arrears. I agreed to forego further child support simply because my gs was now 17 and I was pretty confident he would get a job which he did.

PP is right about applying for a variation as well. It would of course be dependent on how old your child is because I simply wanted to be free of CMS and gs was older so my circumstances were different.

Be prepared for a world of stress but keep going op.

@ElsieMc blimey, sorry you had to go through that. They really don’t care about the impact the stress has on you! My child is 8, so many years of stress to come if he carries on claiming these lies. I wouldn’t mind if I could take him to court for back payments when I can finally prove his really income ! That would wipe the smile off his face. I’ll get back in touch with CMS when I’ve got a few hours to spare! Thanks

[quote yosemite78]@Collaborate he did not start business until February. How often would he pay dividends? He recently made another person company director too, not sure if this affects his income?[/quote]
Is the new company director his partner or close relative? If so, he may be paying most of the salary / dividends to her and only putting a minimum though In his own name.

I know of someone who did this - set up an orthodontic practice with his new Gf who was a dental nurse. Paid her a fortune and himself a pittance.

I mention his exact job to point out how ridiculous this was as most orthodontists earn a bloody fortune - hundreds of thousands a year. And also because it’s clear that he was the one earning all the income as not her.

Of course this is perfectly legal in terms of tax / company law , as long as the share distribution allows it ( I’m assuming she is a shareholder as well as company director ). Or if she’s just a director she can only get salary and not dividends.

But either way thats not much help to you ( or your child ).

And as your ex only set up the company in feb last year he may not even have submitted account or a tax return yet.

Im afraid I don’t know how CMS will deal with that but hopefully someone else will.

@ElsieMc

People who claim to be self Employed but in fact only work for one company full time for years are often breaking HMRC rules called IR35, as he’s probably a “ deemed employee “ and not actually self employed.

www.contractorcalculator.co.uk/what_is_ir35.aspx

He’s lucky that no one has anonymously reported him to HMRC using their online form here

www.gov.uk/government/organisations/hm-revenue-customs/contact/report-fraud-to-hmrc

This might even increase the amount of child maintenance due as if he was investigated, he would have to declare all his income as they would be all over him like a rash.

Just sayin..

If his income isnt relative to his income you can take him back to family court. See a solicitor. I know someone who successfully proved the numbers and life style didnt add up