Child maintenance is calculated by the Child Support Agency (CSA)

Navigating the intricacies of the law when dealing with emotional family and children related matters can often feel overwhelming, with many myths and misconceptions clouding the process.

At Boodle Hatfield, our team of experts understands the importance of clarity and accurate information during life’s most personal and challenging times. That’s why we’ve created our Family Law Mythbusters series—to address common misunderstandings. Senior Associate, Katie Male outlines the answer to the below myth.

The Myth – all child maintenance payments are calculated by the Child Support Agency (CSA)

If only things were so simple! What used to be the CSA became CMEC and is now the CMS – the Child Maintenance Service – although there are people who confusingly still refer to the CSA or indeed CMEC. Once we get beyond the label however, there are all sorts of variables, which we look at in this quick overview. The maintenance payable will depend on the route to be taken which will depend on the specific facts of the case in question and, can involve a high degree of judicial discretion.

Where the paying party’s gross taxable income (after deducting pension contributions) does not exceed £156,000 per annum and both of the parents and the child live in England and Wales, the CMS has exclusive jurisdiction to determine the level of child maintenance payable. In order to calculate this, the CMS applies a statutory formula which is based on a percentage of the payer’s income, adjusted for nights the child spends with them and the number of relevant other children. So far, so straightforward.

If the paying party’s income is above the CMS threshold, things become more complicated. When there is a maximum CMS assessment in play, the family court has jurisdiction to order a party to pay “top up” maintenance for a child. The quantification of the top-up is the product of a discretionary balancing exercise of a number of factors written into statute, including the financial needs of the child, the financial resources available to the child and parents, and the standard of living enjoyed by the family. From experience – this is far from a mathematical formula with easily quantifiable inputs and consistently predictable outputs.

Members of the judiciary have sought to acknowledge and address this in a number of recently reported High Court decisions, culminating (for now) in the 2023 judgment in James v Seymour. In that case, the judge devised a formula which produced what he described as a “loose starting point” for calculating child maintenance where the paying party’s gross taxable income is above £156,000 but does not exceed £650,000. The formula is based on the CMS formula but is adjusted to account for school fees paid and “economies of scale” where there are multiple children.

The judge who came up with the formula expressly acknowledged that it was only applicable in a “conventional” child maintenance case (i.e. not where a parent is seeking a contribution to the costs of their household for the benefit of a child, which would ordinarily only be relevant in circumstances where there was no concurrent spousal maintenance claim). Further the James v Seymour formula would not be appropriate for use where (i) the payer’s gross taxable income is above £650,000 pa; or (ii) where there are 4 or more children; or (iii) where the payer’s income is largely unearned; or (iv) where the payer lives on capital.

In scenarios (i) – (iv), the court must default to the balancing exercise described above. The James v Seymour formula may also be disapplied from cases where a variation of an existing child maintenance order is sought. The judge in James v Seymour opined that the starting point in variation cases should be to adjust the original child maintenance order for inflation, but in respect of variation cases – it should not be forgotten the court is also required to take account of other changes in circumstances.

So we can see that the James v Seymour formula offers some assistance – but not in every case. Further, where the James v Seymour formula may on the face of it be relevant, it is emphasised in the judgment that it is not a replacement for the balancing exercise which must underpin any award of top-up child maintenance. Judges remain free in their discretion to depart from the suggested starting point produced by the formula. That being the case, there remains considerable scope for moving away from a strict application of the formula, most fundamentally because the court’s jurisdiction to make financial orders is discretionary and explicitly not formula-based.

While the certainty and consistency implied by a formula are enticing, the James v Seymour formula is a tool, not a rule. Given the various exceptions, calculating child maintenance remains an art not a science.