SB CCS 2082 2015
| Jurisdiction | UK Non-devolved |
| Judge | Judge E. Mitchell |
| Judgment Date | 12 February 2016 |
| Neutral Citation | 2016 UKUT 84 AAC |
| Subject Matter | Child support |
| Respondent | (1) Secretary of State for Work and Pensions and (2) TB (CSM) |
| Court | Upper Tribunal (Administrative Appeals Chamber) |
| Docket Number | CCS 2082 2015 |
| Appellant | SB |
IN THE UPPER TRIBUNAL Case No. CCS/2082/2015
ADMINISTRATIVE APPEALS CHAMBER
Before: Mr E Mitchell, Judge of the Upper Tribunal
Decision: The decision of the First-tier Tribunal, sitting at Derby on 15th May 2015 (tribunal ref: SC 034/14/00886), involved an error of law. Under section 12(2) of the Tribunals, Courts and Enforcement Act 2007, I set aside the Tribunal’s decision and re-make the First-tier Tribunal’s decision as follows:
1. Mr B’s appeal against the Secretary of State’s child maintenance calculation decision of 3rd June 2014 is allowed.
2. I set aside the Secretary of State’s decision and remit the case to the Secretary of State.
3. I direct the Secretary of State to make a fresh request for a HMRC figure (within the meaning of regulation 36(1) of the Child Support Maintenance Regulations 2012).
4. Unless regulation 34(2) of the 2012 Regulations requires Mr B’s current income to be used, I direct the Secretary of State to determine Mr B’s “historic income”, and determine his child maintenance calculation, on the basis of that HMRC figure.
5. The effective date for that calculation is 25th May 2014.
REASONS FOR DECISION
Introduction and summary
1. I believe this case is the Upper Tribunal’s first opportunity to consider the new legislative scheme for determining child support maintenance liabilities. That new scheme comprises the Child Support Act 1991, as amended by the Child Maintenance and Other Payments Act 2008, and the Child Support Maintenance Regulations 2012 (“2012 Regulations”)
2. Under the new scheme, the amount of a parent’s child support maintenance liability depends on the parent’s gross weekly income. The 2012 Regulations confer an important function on H.M. Revenue & Customs (HMRC) in the fixing of a parent’s gross weekly income. This involves HMRC supplying what is referred to by the 2012 Regulations as a “HMRC figure”.
3. In this case, the figure supplied by HMRC was out-of-date. It related to the tax year 2008/09 even though HMRC held income data for tax year 2013/14. The 2008/09 figure supplied is said to be some £4,000 more than that for tax year 2013/14.
4. Child support officials tried to obtain another HMRC figure using a computer ‘interface’ developed for this purpose. But the system refused to accept the command to do so. It seems it was configured to permit only one request for a HMRC figure per maintenance application. Before the First-tier Tribunal, the Secretary of State argued the computer system was simply operating in accordance with the 2012 Regulations. They permitted only a single request for a HMRC figure. If that figure was wrong, it was, in effect, tough luck.
5. The First-tier Tribunal reluctantly refused the non-resident parent’s appeal, agreeing with the Secretary of State that the 2012 Regulations operated as he had argued. The Tribunal described this state of affairs as “Kafkaesque” and granted permission to appeal to the Upper Tribunal.
6. Before the Upper Tribunal, the Secretary of State withdrew his previous argument about the effect of the 2012 Regulations. I agree with the Secretary of State that the 2012 Regulations do not embed inaccurate HMRC income data in the child support maintenance calculation. Further requests for HMRC income data are permitted where the data initially provided is out-of-date or inaccurate.
Factual background
7. Using the terminology of the Child Support Act 1991, Mr B is the “non-resident parent” and Mrs B the “parent with care”.
8. On 22nd May 2014, Mrs B applied to the Secretary of State, under section 4 of the Child Support Act 1991, for a maintenance calculation in respect of Mr B. This was a new application and it fell to be dealt with under the new child support regime.
9. On 2nd June 2014, the Secretary of State electronically requested Mr B’s income data from HMRC. This is known as a “HMRC figure” under the 2012 Regulations. HMRC provided a “HMRC figure” forthwith. However, it concerned tax year 2008/09 and gave an annual income of around £34,000. Mr B was aggrieved with this because he said his current annual income was only some £30,000.
10. Mr B took the matter up with HMRC. He obtained from them written confirmation (dated 3rd June 2014) that their records showed his income for 2013/14 was indeed around £30,000. Mr B informed the Secretary of State’s child support officials.
11. In response to Mr B’s information, a child support official tried to “re-trigger HMRC button, but it still only pulls through 2009 income”, according to a decision-maker’s note at p.18 of the First-tier appeal papers.
12. Before the First-tier Tribunal, the Secretary of State argued the law only allowed a single request for a HMRC figure in respect of a particular application for a child maintenance calculation. This was because regulation 35(2) of the Child Support Maintenance Regulations 2012 provides “a request” is to be made which means “there is no provision within legislation for a further drawdown to be attempted at this time”.
13. Mr B appealed to the First-tier Tribunal which reluctantly dismissed his appeal. The Tribunal accepted the Secretary of State’s argument that one, and only one, ‘drawdown’ from the HMRC computer system was permitted. Come what may, that figure had to be inputted into the 2012 Regulations’ maintenance calculation formula on Mrs B’s application for a maintenance calculation.
14. The First-tier Tribunal granted Mr B permission to appeal to the Upper Tribunal. In so doing, it stated “there is a question of law at the heart of the appeal…which relates to the proper extent, if any, to which the Tribunal can go behind the HMRC figure obtained by the Secretary of State (the historic income figure) when making the maintenance calculation for the purposes of the 2012 scheme”.
The grounds of appeal
15. In case management directions, I directed that the grounds of appeal were as follows:
(a) whether the Secretary of State and Tribunal wrongly thought reg. 35(2), by referring to “a request”, prevents more than a single HMRC request / drawdown on an initial child support application. Arguably, they overlooked section 6 of the Interpretation Act which provides that in any Act (and Statutory Instrument”) “unless the contrary intention appears…words in the singular include the plural”;
(b) whether there was a valid HMRC figure at all. There appears no obvious legislative provision rendering conclusive the information provided by HMRC. There is a definition of HMRC figure and this refers to income for the “latest available tax year” (reg. 36). If, in fact, the information provided by HMRC is not for the latest available tax year for which they have received the required income information (e.g. HMRC wrongly give information about an earlier tax year), then arguably there is no HMRC figure at all, since the definition of HMRC figure is not satisfied;
(c) whether, on the assumption there was no valid HMRC figure at all, the First-tier Tribunal should have applied reg. 34(2), found that the presumption in favour of historic income was disapplied and so re-made the calculation using current income. To recap, reg. 34(2) refers to cases where “the Secretary of State is unable, for whatever reason, to request or obtain the required information from HMRC”.
The arguments
The Secretary of State’s position
16. In a helpful submission, the Secretary of State’s representative Mr R Whitaker indicates his support for the appeal. Mr Whitaker argues:
(a) when faced with a request for an income figure for child support purposes, HMRC are expected to provide data that is as accurate as they “can reasonably provide”. If a non-resident parent has failed to supply HMRC with up-to-date income information, they must bear the consequences of that for child support purposes;
(b) if HMRC mistakenly provide out-of-date income data, that does not constitute a “HMRC figure” for the purposes of the child support maintenance calculation regulations;
(c) the Secretary of State accepts that, when HMRC were requested to provide a “HMRC figure” for Mr B, they did not supply the most recent income data that they held;
(d) there is “good reason” for the regulations referring to the making of HMRC’s requests in the singular:
“the ‘drawdown’ system…is set up in such a way that only one request can be made per year. This is to prevent that original benchmark ‘historic income’ figure from being changed over the course of the following year (prior to the next child maintenance review date). This should not normally happen as the 2012 scheme is designed specifically so that there are long term (i.e. of at least a year) assessments in place, except in prescribed circumstances, e.g. where there is a significant change of income (25% or more).”
(e) there must, however, be provision for further requests for HMRC...
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