Children: Maintenance:Written question - 106137

Q
(Motherwell and Wishaw)
Asked on: 06 October 2017
Department for Work and Pensions
Children: Maintenance
Commons
To ask the Secretary of State for Work and Pensions, why the Child Maintenance Service allows non-resident parents £2,500 of unearned income that is not factored into payment plans; and whether he plans to review this policy.
A
Corrected answer by: Kit Malthouse
Corrected on: 01 February 2018
An error has been identified in the written answer given on 12 October 2017.
The correct answer should have been:

Calculation of a child maintenance liability is based on gross income information provided directly to the Child Maintenance Service by HMRC. Individuals are required to declare unearned income not taxed at source which does not exceed £2500 a year to HMRC, which already enables HMRC to include it in the income information they provide. Unearned income exceeding £2500 a year is dealt with by HMRC through tax self-assessment and is picked up in a child maintenance calculation through an unearned income variation. We have no plans to review this.The treatment of unearned income for child maintenance purposes is aligned with this for administrative efficiency. We are inviting views on the future treatment of "income" within the recently published Compliance and Arrears Strategy consultation.

A
Answered by: Caroline Dinenage
Answered on: 12 October 2017

Calculation of a child maintenance liability is based on gross income information provided directly to the Child Maintenance Service by HMRC. Individuals are required to declare unearned income not taxed at source which does not exceed £2500 a year to HMRC, which already enables HMRC to include it in the income information they provide. Unearned income exceeding £2500 a year is dealt with by HMRC through tax self-assessment and is picked up in a child maintenance calculation through an unearned income variation. We have no plans to review this.The treatment of unearned income for child maintenance purposes is aligned with this for administrative efficiency. We are inviting views on the future treatment of "income" within the recently published Compliance and Arrears Strategy consultation.

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