“adjusted taxable income has the meaning in section 33

“annual amount of child support means the amount payable in a child support year by a liable parent in respect of a qualifying child

“annual rate of child support means the total amount payable in a child support year by a liable parent in respect of all of his or her qualifying children

“care cost percentage means the percentage of costs associated with providing a proportion of ongoing daily care to a child; and, in relation to a particular parent or carer of a child, is the percentage set out in column 2 of the table in Schedule 1 that reflects the proportion of ongoing daily care that the Commissioner establishes (under section 14) that the person provides to the child

“care order or agreement means any of the following that are in force:

• “(a) a parenting order made under section 48(1) of the Care of Children Act 2004:

• “(b) an overseas parenting order as defined in section 8 of the Care of Children Act 2004:

• “(c) any agreement (not being an order referred to in paragraph (a) or (b))—

  • “(i) that the parents and carers of a child agree to treat as binding on them; and

  • “(ii) that identifies the proportion of care that each parent and carer of the child will provide to the child

“carer means, in relation to a child, a person (whether or not a parent) who provides ongoing daily care to the child, other than on a commercial basis

“child expenditure amount has the meaning set out in section 29(1A)

“child expenditure table means, in relation to a child support year, the child expenditure table approved by the Commissioner under section 36D applying to that year

“child support group, in relation to a parent who, at a particular time, has more than 1 qualifying child, means the qualifying children of that parent who all share the same other parent and in relation to whom child support for that time has been assessed or is being assessed

“income percentage means, in relation to a parent of a qualifying child, that parent's percentage of the combined child support income amounts of all the child's parents, as determined under section 31

“liable parent means,—

• “(a) in relation to a parent subject to a formula assessment, a parent of a qualifying child whom the Commissioner determines under section 17 is a liable parent of the child; and

• “(b) in relation to any other parent, a parent who is liable to pay child support under section 58(1) or 68(1)

“receiving carer means a carer of a qualifying child in respect of whom child support payments are payable under this Act by a liable parent of the child whom the Commissioner determines under section 17 is a receiving carer of the child

“tax year has the meaning in section YA 1 of the Income Tax Act 2007

“taxable income has the meaning in section YA 1 of the Income Tax Act 2007”.

“2A 3A Provisions affecting application of Transitional and savings provisions relating to amendments to this Act

• Schedule 1AA contains application, savings, and transitional and savings provisions (relating to amendments made to this Act on or after 1 April 2014) that affect other provisions of this Act (see section 276).”

• “(fa) to affirm the right of carers who provide significant care to children to receive financial support in respect of those children from a parent or parents of the children:”.

“4A Overview of child support payable under formula assessment

• “(1) A parent or non-parent carer of a qualifying child, who does not live with a parent of the child in a marriage, civil union, or de facto relationship, may apply to the Commissioner for a formula assessment of child support payable for that child by a liable parent.

  “(2) The Commissioner will then determine the proportion of care that each carer of the child provides, and the income of each parent of the child, and, using that information, will identify the parent or parents who are liable to pay child support, and the carer or carers who are entitled to receive child support, in respect of the child.

  “(3) A person will be a liable parent in respect of a child if he or she provides less than 28% of the ongoing daily care to the child or if his or her income percentage (which is a percentage of the combined child support income amounts of both the child's parents (the person's income percentage) is greater than the person's care cost percentage (which is a cost percentage directly related to the proportion of care that the parent provides to the child).

  “(4) The amount of If annual child support is payable by a liable parent for a qualifying child, the amount is determined under Part 2, and. It is worked out by deducting the liable parent's care cost percentage from their income percentage, and then multiplying the result by the appropriate amount set out in the relevant child expenditure table (which identifies, amongst other things, the average annual expenditure on children in New Zealand, by reference to average weekly earnings).

  “(5) This section is by way of explanation only. If it is inconsistent with any other provision of this Act, the other provision prevails.”

• “(a) is under the age of 18, or is aged 18 and enrolled at and attending a school; and”.

• “(2) In subsection (1)(a), school means—

  • “(a) a registered school (as defined in section 2(1) of the Education Act 1989); or

  • “(b) an overseas school.

• “(3) A child who is enrolled at a registered school and attends it until the end of the school's academic year is deemed to be enrolled at and attending the school until 31 December in that year.

• “(4) In relation to the child support year commencing on 1 April 2014, subsection (1) must be read as if the whole of paragraph (a) were replaced by a reference to a child under 19 years of age.”

“7B Assumptions about parents of child

• “(1) The Commissioner is entitled to assume, for the purposes of a formula assessment, that a qualifying child has 2 parents, and that those parents are living apart.

  “(2) However, if the Commissioner believes on reasonable grounds that that assumption is either of those assumptions is incorrect, the Commissioner must apply the provisions of this Act, with any necessary modifications, to reflect the true position, as determined by the Commissioner.

“Application for formula assessment

“8 Who may apply for formula assessment

• “(1) Any parent or carer of a qualifying child may apply to the Commissioner for a formula assessment of child support payable by a liable parent in respect of the child, if the applicant is not living with a parent of the child in a marriage, civil union, or de facto relationship.

  “(2) However, if a qualifying child is a child in respect of whom payments are being made under section 363 of the Children, Young Persons, and Their Families Act 1989, then, despite subsection (1), the only person who may apply for a formula assessment in relation to the child is either of the following:

  • “(a) the chief executive of the department for the time being responsible for the administration of the Children, Young Persons, and Their Families Act 1989; or

  • “(b) a body or organisation approved under section 396 of that Act.

“9 Social security beneficiaries must apply for formula assessment

• “(1) This section applies to a person who is a carer of a qualifying child (other than a child to whom section 8(2) applies) and—

  • “(a) is a social security beneficiary; and

  • “(b) provides, or considers that he or she provides, at least 35% of ongoing daily care to the child; and

  • “(c) is not a receiving carer in respect of the child (but see subsection (3A)).

  “(2) A person to whom this section applies must apply for a formula assessment of child support in relation to every parent of the child.

  “(3) An application for a formula assessment must be made at the same time as an application for the social security benefit is made, and at any other time when the Commissioner notifies the beneficiary that an application for a formula assessment is required in relation to a qualifying child.

  “(3A) If a person who is or becomes a social security beneficiary receives child support pursuant to an order under Part 4 that relates to an overseas order (as referred to in section 67(b)),—

  • “(a) the person is deemed not to be a receiving carer for the purpose of this section; and

  • “(b) the person is deemed to have made, on the date on which he or she becomes a social security beneficiary, an election under section 70 that the order be one to which Part 4 does not apply; and

  • “(c) if the person ceases to be a social security beneficiary, or ceases to provide at least 35% of ongoing daily care to the child,—

    • “(i) any formula assessment applying at that time ceases to apply; and

    • “(ii) the election under section 70 is deemed to be revoked (despite section 70(4)) on the following day.

  “(4) If the person is in receipt of an unsupported child's benefit in respect of 1 or more children, but is not in receipt of any other social security benefit, subsection (2) applies only in relation to the child or children in respect of whom the unsupported child's benefit is paid.

  “(5) Any social security beneficiary who fails to comply with their obligations under this section is liable under section 70A of the Social Security Act 1964 to have their rate of benefit reduced.

  “(6) In order to ensure the enforcement of section 70A of the Social Security Act 1964, the Commissioner may notify the chief executive of the department responsible for the administration of that Act if any social security beneficiary fails to comply with his or her obligations under this section, or if his or her application for a formula assessment is not properly completed.

“10 Form of application

• “(1) An application for formula assessment must be in an approved form and be accompanied by the documents (if any) specified in the form.

  “(2) Every application must—

  • “(a) identify at least 1 qualifying child to whom the application relates; and

  • “(b) identify, in relation to each qualifying child, at least 1 person who provides at least 35% of ongoing daily care to the child; and

  • “(c) identify at least 1 person as a liable, or potentially liable, parent of each qualifying child identified; and

  • “(d) include the tax file number (as defined in section YA 1 of the Income Tax Act 2007) of each qualifying child (except to the extent that the application form permits otherwise).

  “(3) The application, and every document accompanying it, must be verified as specified in the application form.

  “(4) An application for a formula assessment is properly completed if—

  • “(a) it contains all the information required by the application form to be supplied; and

  • “(b) it is accompanied by all the documents required by the application form to accompany the application; and

  • “(c) the application and documents are verified as required by the application form.

“11 Multiple applications in single form

• “(1) If an application for a formula assessment is made on a single form in respect of 2 or more children, the form may be treated as if it contained separate applications for formula assessment of child support for each child.

  “(2) Subsection (3) applies if—

  • “(a) an application is made on a single form for child support in respect of 1 child or 2 or more children; and

  • “(b) payment of child support is sought from 2 or more parents for both parents of the child or any of the children.

  “(3) When this subsection applies, the form may be treated as if it contained separate applications for a formula assessment of child support in respect of the child or each of the children from a parent from whom payment of child support is sought.

“12 Deemed application by beneficiary

• “(1) This section applies if a social security beneficiary is entitled to child support payments under a voluntary agreement but child support payments then cease to be payable under the agreement because—

  • “(a) the agreement expires; or

  • “(b) the amount payable by the liable parent is less than the amount that would be payable by the liable parent under a formula assessment; or

  • “(c) an election under section 64 (to terminate liability under the voluntary agreement) takes effect.

  “(2) If this section applies, on the day after the date on which the child support payments cease to be payable under the agreement, the Commissioner is deemed to have received from the beneficiary a properly completed application for a formula assessment for child support, as required by section 9, in relation to the same child or children, the same liable parent, and the same carer, as the voluntary agreement related to.

“13 Notification by Commissioner of application

• “(1) On receiving a properly completed application for a formula assessment in respect of 1 or more qualifying children, the Commissioner must notify the applicant, and every parent and carer identified in the application, that the Commissioner has received an application for a formula assessment and will therefore ascertain—

  • “(a) who the liable parent or parents, and who the receiving carer or carers, of the qualifying child are; and

  • “(b) the annual amount of child support payable by any liable parent in respect of each qualifying child identified in the application; and

  • “(c) the annual rate of child support payable by any liable parent in respect of all the liable parent's qualifying children; and

  • “(d) the amount payable in respect of each receiving carer; and

  • “(e) the date on which the liability of a liable parent to pay child support began or begins.

  “(2) If, in order to ascertain the matters listed in subsection (1), the Commissioner needs further information from the applicant (such as the name of the other parent), the Commissioner may require the applicant to provide that information and need not take further action with respect to the application until the information is provided.

  “(3) If the Commissioner has already ascertained some or all of the matters listed in subsection (1), the notice under this section may include that information.

“Determining care cost percentages

“14 Commissioner to establish proportions of care

• “(1) The Commissioner must establish, for each qualifying child to whom a properly completed application relates, the proportion of ongoing daily care that each parent and non-parent carer identified in the application, or in other information provided following a request under section 13(2), provides to the child.

  “(2) If 2 or more people who live together each provide ongoing daily care to a child,—

  • “(a) only 1 of those people may be treated as a carer, and the care provided by the other persons must be treated as part of the care provided by the first person; and

  • “(b) if 1 of the people is a parent of the child, that person must be treated as the carer.

  “(3) The parents of a qualifying child in respect of whom payments are being made under section 363 of the Children, Young Persons, and Their Families Act 1989 are deemed to provide no ongoing daily care to the child.

“15 How Commissioner establishes proportions of care

• “(1) For the purpose of section 14, the Commissioner must (subject to subsection (3)) rely on the content of any care order or agreement relating to a qualifying child when establishing the proportion of ongoing daily care that a carer provides to the child.

  “(2) If a care order or agreement specifies the proportion of nights that a child is to spend with a carer, that proportion of nights is taken to be the proportion of ongoing daily care provided to the child by that carer.

  “(3) A parent or carer of a qualifying child may challenge the application of subsection (1) or (2) by providing evidence of—

  • “(a) why a care order or agreement should not be relied on; or

  • “(b) why the proportion of nights that a child spends with a carer should not be taken to be the proportion of ongoing daily care provided to that child by that carer.

  “(4) If there is no care order or agreement relating to the child, or if the Commissioner is satisfied, on the basis of evidence provided, that a care order or agreement does not accurately reflect the proportion of ongoing daily care provided by a carer to a child, the Commissioner must establish the proportion of care provided by a carer primarily on the basis of the number of nights that the child spends with the carer.

  “(5) If the Commissioner is satisfied, on the basis of evidence provided, that the number of nights spent with a carer is not a true reflection of the proportion of care actually provided by a carer to the child, the Commissioner must establish the proportion of care provided on the basis of the amount of time that the carer is the person responsible for the daily care of the child.

  “(6) When establishing proportions of care, the Commissioner—

  • “(a) must use only whole percentage figures and, for that purpose, must round figures over 50% upwards to the next whole percentage figure, and figures under 50% downwards to the next whole percentage figure; and

  • “(b) must assume that every year has 365 days.

“16 Determining care cost percentages

• “(1) The Commissioner must determine the care cost percentage of each parent and carer of a qualifying child on the basis of the proportion of care that the Commissioner has established, under section 14, that each carer provides to the child.

  “(2) The care cost percentage that applies is the relevant percentage set out in, or determined in accordance with, column 2 of the table in Schedule 1.

“Liable parents and receiving carers

“17 Identification of liable parents and receiving carers

• The Commissioner must identify the liable parents and receiving carers of each qualifying child as follows:

  • “(a) a parent of a qualifying child is a liable parent in relation to the child if—

    • “(i) the parent provides less than 28% of ongoing daily care to the child (which means the parent's care cost percentage is nil); or

    • “(ii) the parent's income percentage (as determined under section 31) is greater than their care cost percentage (as determined under section 16) for the child:

  • “(b) a parent of a qualifying child is a receiving carer of the child if the parent's income percentage is less than the parent's care cost percentage for the child, and that care cost percentage is at least 25% (which means the parent provides at least 35% of ongoing daily care to the child):

  • “(c) a non-parent carer of a qualifying child who provides at least 35% of ongoing daily care to the child is a receiving carer of the child.

“17 Determining who are liable parents and receiving carers

• “(1) The Commissioner must determine the liable parents and receiving carers of each qualifying child, in accordance with this section.

  “(2) A parent of a qualifying child is a liable parent of that child if the parent's income percentage (as determined under section 31) is greater than or equal to their care cost percentage for that child (as determined under section 16).

  “(3) A parent of a qualifying child is a receiving carer of the child if the parent's income percentage is less than their care cost percentage for the child.

  “(4) A non-parent carer of a qualifying child is a receiving carer of the child if the carer provides at least 35% of ongoing daily care to the child.

“18 Effect of being liable parent or receiving carer

• “(1) A person who whom the Commissioner determines is a liable parent of a child is liable to make payments of child support in respect of that child, in accordance with an assessment under Part 2 unless the parent's liability is assessed as nil in accordance with section 29A(1A).

  “(2) A person who whom the Commissioner determines is a receiving carer of a child is a person in relation to whom child support payments in respect of the child are payable, in accordance with Part 9 unless no child support is payable in accordance with section 36A(3) or 36C(4).

  “(3) If, under section 17, a person is identified as a liable parent in respect of a child but no other person is identified as a receiving carer,—

  • “(a) the Commissioner may determine, despite anything in Part 2, that no child support is payable by that person for the child; but

  • “(b) the person is entitled to be treated for the purposes of this Act as a liable parent of the child.

  “(4) If, under section 17, a person is identified as a receiving carer in respect of a child but no other person is identified as a liable parent,—

  • “(a) the Commissioner may determine, despite anything in Part 2, that no child support is payable to the receiving carer in respect of the child; but

  • “(b) the person is entitled to be treated for the purposes of this Act as a receiving carer of the child.

“Beginning of liability to pay child support under formula assessment

“19 When liability to pay child support starts

• “(1) The liability of a liable parent to pay child support under a formula assessment starts from—

  • “(a) from the day on which the properly completed application for that formula assessment is received by the Commissioner; or

  • “(b) if a reassessment results in a person being identified as a liable parent, from the date specified in the reassessment as the effective date.

  “(2) If a parent becomes liable to pay child support to a person in relation to a child under a formula assessment, any existing liability of that parent to pay child support to the person in relation to that child under any voluntary agreement is suspended between the commencement of liability to pay under the formula assessment and the end of that liability.

  “(3) If the Commissioner receives an application for a formula assessment that names a person as a parent of a qualifying child (person P), but person P is not at that time a parent of the child within the meaning of section 7, then, if the application is otherwise properly completed, liability by person P to pay child support in respect of the child starts from the day on which the application was received if—

  • “(a) a court later declares person P to be the parent of the child, or person P is later declared to be a parent of the child by an order made by a court or a public authority in an overseas jurisdiction; and

  • “(b) the Commissioner determines under this Part that person P is a liable parent of the child.”

“25 When liability to pay child support ceases

• “(1) A liable parent ceases to be liable to pay child support in respect of a qualifying child under a formula assessment on the day before the date on which the child—

  • “(a) ceases to be a qualifying child; or

  • “(b) is adopted; or

  • “(c) dies.

  “(2) A liable parent ceases to be liable to pay child support under a formula assessment on the day the parent ceases to be a liable parent under section 17, or on the day before the date on which the parent—

  • “(a) becomes a person who is none of the following:

    • “(i) a New Zealand citizen:

    • “(ii) a person who is ordinarily resident in New Zealand:

    • “(iii) a person who is ordinarily resident in a country with which New Zealand has entered into a reciprocal agreement for the enforcement of child support; or

  • “(b) becomes a person from whom child support may not be sought in respect of the child by reason of section 6(2); or

  • “(c) dies.

  “(3) A liable parent ceases to be liable to pay child support in respect of a particular receiving carer of a qualifying child under a formula assessment on the earliest of the following:

  • “(a) if the receiving carer dies, on the earlier of the following:

    • “(i) the 28th day after the date of death:

    • “(ii) the day before the date on which a properly completed application for formula assessment is received by the Commissioner from a carer in place of the carer who has died:

  • “(b) the day before the date on which the receiving carer ceases to provide at least 35% of ongoing daily care to the child:

  • “(c) the day before the date on which the receiving carer starts to live, or resumes living, with the liable parent of the child in a marriage, civil union, or de facto relationship:

  • “(d) in any case to which section 8(2) applies, the day before the date on which the carer ceases to be under a duty to make payments under section 363 of the Children, Young Persons, and Their Families Act 1989 in respect of the child:

  • “(e) the day specified in a notice of election, given under section 27, to end the liability of the liable parent to the carer (except that this paragraph does not apply in respect of any carer who is in receipt of a social security benefit):

  • “(f) in a case where a voluntary agreement made in relation to the child between the liable parent and the carer is accepted by the Commissioner, the day before the date on which that voluntary agreement first applies, in accordance with section 59.”

“28A Commissioner to assess child support payable under formula assessment

• “(1) As soon as practicable after identifying a liable parent under Part 1, the Commissioner must—

  • “(a) assess the annual amount of child support payable by the liable parent in that child support year in respect of each of his or her qualifying children; and

  • “(b) assess the annual rate of child support payable by the liable parent in that child support year in respect of all of his or her qualifying children; and

  • “(c) where the application for a formula assessment was made in the previous child support year, make such assessments in relation to the previous child support year.

  “(2) Before, or as soon as practicable after, the start of each later child support year in which child support continues, or appears likely to continue, to be payable by the liable parent in respect of any qualifying child of the parent, the Commissioner must make the assessments referred to in subsection (1)(a) and (b) in relation to that later child support year.

  “(3) Every assessment must be done in accordance with this Part and Part 5.

“29 Formula for assessing annual amount of child support

• “(1) The formula for assessing the annual amount of child support payable under a formula assessment by a liable parent in a child support year in respect of a qualifying child is the parent's income percentage minus the parent's care cost percentage, multiplied by the child expenditure amount for the child. This formula can be expressed as—

  (i% – c%) × p

  where—

  i%

  is the liable parent's income percentage determined under section 31

  c%

  is the liable parent's care cost percentage determined under section 16

  p

  is the child expenditure amount for a qualifying child.

  “(1A) The child expenditure amount for a qualifying child in a child support year is—

  e

  n

  where—

  e

  is the amount, determined in accordance with the child expenditure table applying to that child support year, that applies to the parent in respect of the child on the basis of—

  • (a) the combined child support income amounts of all both parents of the child; and

  • (b) the number of children in the child's child support group; and

  • (c) the age group of those children

  n

  is the number of children in the same child support group as the child.

“29A Annual amount of child support payable by liable parent

• “(1A) The annual amount of child support payable under a formula assessment by a liable parent in respect of a qualifying child is nil, and section 30 does not apply, if—

  • “(a) the liable parent provides more than 65% of ongoing daily care to the child; or

  • “(b) the liable parent provides at least 28% of ongoing daily care to the child and the liable parent's income percentage is equal to their care cost percentage; or

  • “(c) no receiving carer provides at least 35% of ongoing daily care to the child.

  “(1) Where subsection (1A) does not apply, the The annual amount of child support payable under a formula assessment by a liable parent in a child support year in respect of a qualifying child is as follows:

  • “(a) the amount determined in accordance with the formula set out in section 29(1), unless paragraph (b) or (c) applies:

  • “(b) for a liable parent to whom section 36 applies but section 36A does not, the lesser of—

    • “(i) the amount determined in accordance with the formula set out in section 29(1); and or

    • “(ii) the amount determined under the multi-group cap (referred to in subsection (2)) applying to the child, but only if it is less than the amount referred to in subparagraph (i):; or

  • “(c) if section 36A applies, the lesser of for a parent to whom section 36A applies (whether or not section 36 also applies),—

    • “(i) the amount determined in accordance with the formula set out in section 29(1); and or

    • “(ia) if the multi-group cap applies, the amount determined under the multi-group cap applying to the child, but only if it is less than the amount referred to in subparagraph (i); or

    • “(ii) the amount described in section 36A(2) payable in respect of a receiving carer under section 36A, but only if it is less than either amount referred to in subparagraph (i) or (ia).

  “(2) The multi-group cap for a child is the amount determined as follows:

  (100% – c%) × m

  where—

  c%

  is the parent's care cost percentage in relation to the child

  m

  is the multi-group cost of the child, as determined under section 36(4).

  “(3) The purpose of the multi-group cap is to avoid liable parents paying more in child support than they would pay if all the children for whom they are liable to pay child support were living together.

“30 Minimum annual rate of child support

• If, after assessing the annual amount of child support payable by a liable parent in respect of each of his or her qualifying children, the Commissioner determines that the total amount payable by the parent is less than the minimum annual rate referred to in section 72(1)(a), the Commissioner must, despite section 29 and 29A(1),—

  • “(a) assess the parent's annual rate of child support as the minimum annual rate referred to in section 72(1)(a); and

  • “(b) determine the proportion of that minimum annual rate of child support that is payable in respect of each receiving carer, on the basis of the number of qualifying children of the liable parent that each carer provides care for.

“Determining income percentages

“31 Income percentage

• A parent's income percentage, in relation to a qualifying child, is the percentage figure derived by dividing the person's child support income amount (as determined under section 32) by the sum of the child support income amounts, in relation to that child, of all the parents of the child.

“32 Child support income amount

• “(1) A parent's child support income amount for a child support year in relation to a child is the person's adjusted taxable income (determined under section 33) for the relevant tax year minus each of the following:

  • “(a) the person's living allowance (as determined under section 34) for the child support year:

  • “(b) the sum of any dependent child allowances to which the person is entitled under section 35 for the child support year:

  • “(c) any multi-group allowance that relates to the child and to which the person is entitled under section 36 for the child support year.

  “(1A) If the result of the calculation in subsection (1) is zero or less, the parent's child support income amount must be treated as being nil.

  “(2) If the adjusted taxable income of a parent of a qualifying child cannot reasonably be ascertained, or cannot be applied by the Commissioner, the parent's child support income amount is to be treated as being,—

  • “(a) if there is 1 parent whose adjusted taxable income is known, the same as that parent's child support income amount; and

  • “(b) if there is more than 1 parent whose adjusted taxable income is known, the average of those parents' child support income amounts.

“33 Adjusted taxable income

• “(1) A person's adjusted taxable income for a child support year is the person's taxable income for the relevant tax year adjusted by the adjustments (if any) that would be made to the person's taxable income to determine the person's family scheme income under subpart MB of the Income Tax Act 2007, except that the following are not to be treated as being part of the person's family scheme income for this purpose:

  • “(a) income that is exempt income under section CW 32 of the Income Tax Act 2007 (child support and spousal maintenance):

  • “(b) income referred to in section MB 11 of the Income Tax Act 2007 (income derived by dependent children):

  • “(c) income referred to in section MB 12 of the Income Tax Act 2007 (non-residents' foreign-sourced income of the person's spouse or partner).

  “(2) However, in relation to any period before the close of the day before 1 April 2015, a person's adjusted taxable income for a child support year is the person's taxable income without the adjustments referred to in subsection (1).

  “(3) A person's taxable income must be taken to be their taxable income for the most recent tax year if income from employment for the calendar year immediately preceding the start of the child support year if—

  • “(a) it was derived solely from withholding income; and

  • “(b) no adjustments of the sort referred to in subsection (1) are made.

  “(4) If subsection (3) does not apply, a person's taxable income for a child support year must be taken to be their taxable income in the tax year immediately preceding the most recent tax year, inflated by the inflation percentage for the child support year.

  “(4A) The adjustments under subsection (1) that must be applied are those that applied in the tax year immediately preceding the most recent tax year.

  “(5) If a person's taxable income for a tax year has not been assessed, the Commissioner must determine the person's taxable income,—

  • “(a) if an income statement has been issued, on that basis; and

  • “(b) in any other case, on the basis of the income and any other particulars known to the Commissioner.

  “(6) Subsections (3) to (5) are subject to sections 38 to 39A.

“34 Living allowance

• “(1) A person's parent's living allowance in a child support year is the appropriate amount referred to in subsection 2—

  • “(a) increased by the total amount of income tax deductions that would be required to make the rate a gross, rather than a net, rate (as determined in accordance with section RD 11(3) of the Income Tax Act 2007); and

  • “(b) annualised.

  “(2) The amount of living allowance is as follows:

  • “(a) for every person other than a person identified in paragraph (b) or (c), the amount specified in Schedule 16 of the Social Security Act 1964 as the amount of domestic purposes benefit payable to a beneficiary with 1 or more dependent children:

  • “(b) for a person who has been granted a domestic purposes benefit at the rate payable to a single beneficiary with 1 or more dependent children, under section 27G of the Social Security Act 1964 (domestic purposes benefit for care at home of the sick or infirm), the amount specified in Schedule 17 of that Act for that benefit type:

  • “(c) for a person who has been granted an invalid's benefit at the rate payable to a single beneficiary with 1 or more dependent children, under section 40 of the Social Security Act 1964, the amount specified in Schedule 6 of that Act for that benefit type.

  “(4) The version of the appropriate schedule of the Social Security Act 1964 that applies in a child support year is the version in force on 1 January in the immediately preceding child support year.

  “(5) The Commissioner must ensure that notice of the applicable living allowances under this section that apply to the current and (if applicable) the previous child support year is available at all reasonable times on an Internet site maintained by or on behalf of the Inland Revenue Department.

“35 Dependent child allowance

• “(1) For the purpose of calculating a parent's child support income amount under section 32 in a child support year, a parent is entitled to a dependent child allowance in respect of each of his or her dependent children.

  “(2) The amount of a parent's dependent child allowance, in relation to each dependent child, is—

  	c% ×	e
  		n

  where—

  c%

  is the care cost percentage of the parent in relation to the dependent child (being the percentage that would be determined under section 16 if the child were a qualifying child)

  e

  is the amount, determined in accordance with the child expenditure table applying to that child support year, that applies to the parent in respect of the dependent child on the basis of—

  • (a) the child support income amount of the parent alone, with that amount being treated as the adjusted taxable income of the parent, minus the parent's living allowance; and

  • (b) the total number of the parent's dependent children; and

  • (c) the age group of those children

  n

  is the total number of the parent's dependent children.

  “(3) In this section, a parent's dependent child is any child of the parent who a person's dependent child means a child of whom the person is a parent (within the meaning in section 7) and who—

  • “(a) is maintained as a member of the parent's family and for whom the parent provides at least 28% of the ongoing daily care; and

  • “(b) is not a child for whom any person is liable to pay child support or is required, in relation to whom any person is a liable parent or receiving carer, or for whom, under the law of another country, any person is required to make payments that are of the same nature as child support; and

  • “(c) meets the requirements of section 5(1)(a) to (c) (which describe which children qualify for child support).

“36 Multi-group allowance

• “(1) This section applies to a parent who has more than 1 child support group.

  “(2) For the purpose of calculating a parent's child support income amount in relation to a particular child (child C) in a child support year, a parent to whom this section applies is entitled to a multi-group allowance in relation to child C.

  “(3) The multi-group allowance in relation to child C is the sum of the multi-group costs of each child (child D) of the parent who is not in the same child support group as child C.

  “(4) The multi-group cost of child D is—

  	e
  	n

  where—

  e

  is the amount, determined in accordance with the child expenditure table applying to the relevant child support year, that applies to the parent in respect of child D—

  • (a) on the basis of the child support income amount of that parent alone, with that amount being treated as the adjusted taxable income of the parent, minus the parent's living allowance and the sum of any dependent child allowances to which the parent is entitled; and

  • (b) as if—

    • (i) child D were one of n children; and

    • (ii) all those children were the same age as child D

  n

  is the total number of children of the parent in all the parent's child support groups.

“Amounts payable in respect of receiving carers

“36A Where parent is sole receiving carer

• “(1) This section applies where a liable parent is liable to pay, in respect of a qualifying child, there is only 1 receiving carer, and that carer (person P) is a parent of the child.

  “(2) When this section applies, the amount of child support payable in respect of person P is the amount of annual child support that person P would pay if the difference between person P's income percentage and care cost percentage (which, under the formula in section 29, is a negative percentage) were a positive percentage.

  “(2) When this section applies, the amount of child support payable in respect of person P is—

  • “(a) the amount of annual child support that person P would pay if the difference between person P's income percentage and care cost percentage (which, under the formula in section 29, is a negative percentage) were a positive percentage; or

  • “(b) if the multi-group cap applies, the amount payable under the multi-group cap, but only if it is less than the amount payable under paragraph (a).

  “(3) However, no child support is payable under subsection (2) in respect of a receiving carer of a qualifying child if the receiving carer provides less than 35% of ongoing daily care to the child.

“36B Where no receiving carers are parents

• “(1) This section applies if, in respect of a qualifying child, a liable parent is liable to pay child support in respect of there are 1 or 2 receiving carers, and neither of them is a parent of the child.

  “(2) If the liable parent is liable to pay child support in respect of just 1 non-parent receiving carer, the amount of child support payable in respect of that carer is the annual amount of child support payable by the liable parent for the child.

  “(3) If the liable parent is liable to pay child support in respect of 2 non-parent receiving carers, the amount of child support payable in respect of each carer is—

  	f ×	c%
  		g%

  where—

  f

  is the annual amount of child support payable by the liable parent for the child

  c%

  is the care cost percentage of the receiving carer in relation to the child

  g%

  is the combined care cost percentages of both the receiving carers of the child, in relation to the child.

“36C Where 1 receiving carer is parent and other is non-parent

• “(1) This section applies if, in respect of a qualifying child, a liable parent is liable to pay child support in respect of there are 2 receiving carers, where 1 of them is a parent of the child and the other is a non-parent carer of the child.

  “(2) The amount of child support payable to the receiving parent (person P) is the amount of annual child support that person P would pay if the difference between person P's income percentage and care cost percentage (which, under the formula in section 29, is a negative percentage) were a positive percentage.

  “(2) The amount of child support payable in respect of the receiving parent (person P) is—

  • “(a) the amount of annual child support that person P would pay if the difference between person P's income percentage and care cost percentage (which, under the formula in section 29, is a negative percentage) were a positive percentage; or

  • “(b) if the multi-group cap applies, the amount determined by multiplying—

    • “(i) the amount payable in respect of the qualifying child, as determined by the liable parent's multi-group cap; by

    • “(ii) the difference between person P's income percentage and care cost percentage, as if it were a positive percentage.

  “(3) The amount of child support payable to in respect of the non-parent receiving carer is the annual amount of child support payable by the liable parent for the child, minus the amount payable under subsection (2) to person P.

  “(4) However, no child support is payable under subsection (2) in respect of a receiving carer who is a parent of a qualifying child if the parent provides less than 35% of ongoing daily care to the child.

“Expenditure on children

“36D Child expenditure tables

• “(1) Before the start of a child support year, the Commissioner must approve a child expenditure table for that child support year, based on the expenditure on children table in Schedule 2, that identifies, for the relevant child support year,—

  • “(a) the amount of the average weekly earnings that applies; and

  • “(b) the amount of child support income that is taken to be expended on children, with that amount corresponding to the percentages set out in the expenditure on children table within each income band in the table.

  “(2) The Commissioner must ensure that the child expenditure table for the current and (if applicable) the previous child support year is available—

  • “(a) on request to the Inland Revenue Department, in hard copy; and

  • “(b) at all reasonable times, on an Internet site maintained by or on behalf of the Inland Revenue Department.

  “(3) Whenever an income amount is used in relation to the child expenditure table, the income amount must be truncated to whole dollars.”

“Estimate of taxable income

“40AA Definitions in Interpretation for purposes of sections 40 to 45

• In sections 40 to 45, unless the context otherwise requires,—

  “annualised estimated taxable income means the amount that a person estimates will be their taxable income in an election period, annualised (if the estimate does not cover a full child support year) in accordance with the following formula:

  a		× 365
  b

  where—

  a

  is the person’s estimated taxable income for the election period

  b

  is the number of days in the election period

  “election means an election, made by a person under section 40, to have the person’s estimated taxable income, instead of their original taxable income, applied for the purpose of calculating the person’s adjusted taxable income for an election period

  “election period, in relation to a child support year to which an election relates, means,—

  • “(a) if notice of the election is given under section 40 before the start of the child support year, the child support year; and

  • “(b) if notice of the election is given during the child support year, the period in the child support year that starts on the first day of the month in which the notice is given under section 40 and ends on the last day of the child support year

  “estimated taxable income means the amount specified in a notice of election given by a person under section 40 as the amount of taxable income that the person estimates that he or she will earn in the election period

  “original adjusted taxable income means the adjusted taxable income that would have been used to assess a person's child support liability during an election period if the person had not made an election

  “original taxable income, in relation to a person and a child support year, means the person's taxable income, plus any relevant inflation percentage that, but for an election by the person, would have been used to assess the person’s adjusted taxable income for that child support year that would have applied to the person if the person had not made an election

  “year-to-date income means a person's taxable income from specified in a notice of election given under section 40 for the period beginning with the start of a child support year until and ending with the end of the month immediately preceding the month in which the notice of an election is given under section 40.

“40 Estimated taxable income

• “(1) Any person may, by notice to the Commissioner, elect that the taxable income to be used to assess their adjusted taxable income for an election period must be the estimated taxable income specified in the notice of election.

  “(2) The Commissioner, subject to subsection (4) subsections (4) and (6), must accept an election if the sum of the person's year-to-date income (if any) and the person's estimated taxable income is 85% or less than the person's original taxable income.

  “(3) A notice of election must,—

  • “(a) if notice of the election is given before the start of the child support year to which it relates, state the person's estimated taxable income for the full child support year; or

  • “(b) if notice of the election is given during the child support year to which it relates, state—

    • “(i) the person's year-to-date income; and

    • “(ii) the person's estimated taxable income for the election period.

  “(4) The Commissioner may not accept an election if—

  • “(a) an income amount order is in force in relation to the person, and to any months in the child support year in respect of which the election is to apply; or

  • “(b) the person is subject to an order of the court under section 187; or

  • “(c) the person has made an election within the previous 3 months, and the proposed new election would change the person’s annualised estimated taxable income by $500 or less; or

  • “(d) the person made an election in relation to an earlier child support year and was required to provide a return of income under the Income Tax Act 2007 or the Tax Administration Act 1994 in relation to that year, but, at the time the notice is given under this section, the person is in breach of the requirement to furnish a return of income in respect of that year; or

  • “(e) the person's annualised estimated taxable income is more than their original taxable income.

  “(5) A notice under this section may be given in writing or orally any form acceptable to the Commissioner, and is to be treated by the Commissioner as having been given in the month in which it was sent or provided by the person making the election, even if it is received by the Commissioner in the following month.

  “(6) The Commissioner may decline to accept an election if the person making the election does not, on request by the Commissioner, provide the information and evidence that the Commissioner requires in order to support the making of the estimate.

“41 Effect of election

• “(1) If the Commissioner accepts an election made by a person, the Commissioner must determine the person's adjusted taxable income by—

  • “(a) adjust any formula assessment applying to the person in the election period on the basis that the person’s total taxable income for the child support year is calculating the person’s annualised estimated taxable income; and

  • “(b) take whatever steps are necessary to ensure that the amount of child support payable per day during the election period reflects the adjusted assessment.

  • “(b) adjusting the annualised estimated taxable income by the adjustments referred to in section 33, based on the adjustments applying to the tax year immediately preceding the most recent tax year, and applying those adjustments at a uniform daily rate throughout the election period.

  “(1A) The Commissioner must then adjust any formula assessment applying to the person during the election period and take whatever steps are necessary to ensure that the amount of child support payable per day during the election period reflects the adjusted assessment.

  “(2) The making of an election does not prevent the Commissioner making a determination under Part 5A, 6A, or 6B, or the court making an order under Part 7.

“42 Revocation of election and subsequent elections

• “(1) A person who has made an election in relation to a child support year may revoke the election, before or during the child support year, by giving notice to the Commissioner; and the revocation takes effect from the start of the election period to which any election applied.

  “(2) If an election is in effect but the person then makes a later election,—

  • “(a) if the Commissioner accepts the later election,—

    • “(i) the later election takes effect from the start of the month in which the notice of election is given, and section 41 applies accordingly; and

    • “(ii) the earlier election ceases to have effect on the last day of the previous month; and:

  • “(b) if the Commissioner does not accept the later election because the amount of year-to-date taxable income plus the new estimated taxable income is not zero to 85% less than more than 85% of the person's original taxable income, then the earlier estimate is deemed to be revoked; and:

  • “(c) if the Commissioner does not accept the election for any other reason, the earlier estimate remains in effect.

  “(3) A person may not revoke an election if an income amount order comes into force in relation to the person for any period covered by the election.

  “(3) A revocation is of no effect to the extent that it is inconsistent with an income amount order.

“43 Effect of revocation of election

• “(1) When an election is revoked, or deemed to be revoked, the Commissioner must—

  • “(a) adjust any formula assessment applying to the person on the basis that the person’s taxable income is what it would have been had the revoked election not been made of the person's original adjusted taxable income; and

  • “(b) take whatever steps are necessary to ensure that the amount of child support payable per day, during the child support year after the revocation takes effect election period to which the revoked election relates, reflects that adjusted assessment.

  “(2) The revocation of an election does not prevent the Commissioner making a determination under Part 5A, 6A, or 6B, or the court making an order under Part 7, or a person making a further election.

“44 End-of-year reconciliation

• “(1) For the purpose of determining whether a person has, or has been, underpaid or overpaid child support in an election period, after the end of the child support year to which an election relates, the Commissioner must complete an assessment for the person based on the income amount determined under subsection (2).

  “(2) The income amount to be used for the assessment is the least of the following:

  • “(a) the person's actual taxable income earned in the election period (which is the actual taxable income earned in the full year less the year-to-date income identified specified in a notice of election), annualised in accordance with the formula in subsection (3) (which gives the annualised actual taxable income in the election period), and adjusted in accordance with section 41(1)(ab):

  • “(b) the person's original adjusted taxable income:

  • “(c) nil, the value of any adjustments made under section 41(1)(b), but only in the case where the actual taxable income earned by the person during the year is equal to or less than the year-to-date income given specified in the notice of election.

  “(3) The formula for annualising a person's actual taxable income in an election period is—

  a		× 365
  b

  where—

  a

  is the actual taxable income earned during the election period

  b

  is the number of days in the election period.

  “(4) After comparing the result of the assessment done under subsection (2) (1) with the result of the assessment done results obtained under section 41, the Commissioner must take whatever steps are necessary to ensure that the correct amount of child support is assessed for the child support year.

  “(5) A reconciliation under this section is subject to any income amount order that applies during all or any part of an election period.

“44A Reconciliation of estimated income where Determining income amount if no tax return filed

• “(1) This section applies if the Commissioner cannot determine the person's actual taxable income during a child support year because the person, having been required to provide a return of income in respect of the tax year that corresponds to the child support year, has failed to provide it within 28 days of the requirement to provide it.

  “(2) Where this section applies, the Commissioner must determine that the amount to be used for the purpose of the assessment under section 44(2) is the same as the person’s original adjusted taxable income, unless the Commissioner is satisfied that there is reasonable cause for the failure to provide the return of income.

  “(3) A determination under subsection (2) is final unless, within 28 days after the person receives notification from the Commissioner of the determination, the person—

  • “(a) makes an objection under section 90; or

  • “(b) provides a return of income in respect of the relevant tax year to the Commissioner.

  “(4) In subsection (2), reasonable cause means a circumstance that, on application being made by the person under section 37(3) of the Tax Administration Act 1994, results in the Commissioner extending the time for providing the return.

  “(5) A reconciliation under this section is subject to any income amount order that applies during all or any part of an election period.

“45 Penalty if actual income 20% or more than estimated income less than 80% of actual income

• “(1) A person is liable to a penalty under this section if—

  • “(a) their actual taxable income during a child support year is 20% or more than the sum of—

    • “(i) their year-to-date income (if any) as given in a notice of election; and

    • “(ii) their estimated taxable income for the election period; or

  • “(b) the income for a reconciliation has been determined in accordance with section 44A(2) and that income is at least 20% more than the sum of the amounts specified in paragraph (a)(i) and (ii).

  “(1) A person is liable to a penalty under this section if their year-to-date income (if any) specified in the notice of election plus the estimated taxable income for the election period is less than 80% of—

  • “(a) their actual taxable income for the child support year; or

  • “(b) the amount determined under section 44A(2).

  “(2) The penalty is 10% of the difference between—

  • “(a) the annual amount of child support that was assessed under section 41 as payable in the election period; and

  • “(b) the reconciled annual amount of child support payable in the election period, as determined under section 44.

  “(3) However, no penalty is payable by a receiving parent if the amount that the liable parent pays has been determined under the multi-group cap referred to in section 29A(2).

  “(4) The Commissioner must write off a penalty to which a person is liable under this section, or any part of the penalty, if the Commissioner is satisfied that the person, in relation to an election period in a child support year, has become liable to pay a penalty under this section as the result of the taxable income derived by the person in the child support year being higher than it would otherwise have been by reason of—

  • “(a) the enactment of any Act amending the Income Tax Act 2007, or the making of any regulation or Order in Council relating to income tax, during the period commencing on the first day of the last month in that child support year and ending with the due date for payments in respect of that month; or

  • “(b) the Commissioner making public, during that period, any ruling in relation to any provision of the Income Tax Act 2007, and that ruling is different from a ruling previously made public by the Commissioner in relation to that provision; or

  • “(c) the adoption by the person of an incorrect interpretation of any provision of this Act or of the Income Tax Act 2007, being an interpretation which, although incorrect, is reasonable having regard to the circumstances of the case.

  “(5) Subject to the other provisions of this Part, the other Parts of this Act apply with respect to any penalty payable under this section as if it were a penalty payable under section 134, except that late payment penalties do not apply to penalties imposed under this section.”

• “(a) child support payable under a formula assessment by a liable parent in respect of all of his or her children is,—

  • “(i) for the child support year commencing on 1 April 2011 1 April 2013, $848 $871:

  • “(ii) for each later child support year, the minimum annual rate of child support under this paragraph for the immediately preceding child support year, adjusted by the applicable inflation percentage:”.

“82 Parents and receiving carers to advise Commissioner of changes

• “(1) For the purpose of enabling the Commissioner to make or amend a calculation of child support payable in respect of a child in any child support year under a formula assessment, every parent and every receiving carer of the child must advise the Commissioner of any change in the parent's or carer's living circumstances occurring during the child support year that affects, or may affect, any of the following:

  • “(a) in relation to parents and non-parent carers, the determination of the person's care cost percentage:

  • “(b) in relation only to parents, the following:

    • “(i) the person's appropriate living allowance:

    • “(ii) the application or calculation of any dependent child allowance (if any):

    • “(iii) the application or calculation of any person's multi-group allowance (if any):

    • “(iv) the application or calculation of any person's multi-group cap (if applicable).

  “(2) If the Commissioner is satisfied that a relevant change of living circumstances has occurred, the change is to be treated as having occurred—

  • “(a) on the date on which the change occurred, in any of the following cases:

    • “(i) in relation to a liable parent, where the change has the effect of increasing the amount of the parent's child support liability:

    • “(ii) in relation to a receiving carer, where the change has the effect of decreasing the amount of child support payable in respect of that carer:

    • “(iii) where notice of the change is received by the Commissioner within 28 days after the date on which the change occurred; or

  • “(b) on the date on which the Commissioner receives notice of the change, in either of the following cases (unless paragraph (a)(iii) applies):

    • “(i) in relation to a liable parent, where the change has the effect of decreasing the amount of the parent's child support liability:

    • “(ii) in relation to a receiving carer, where the change has the effect of increasing the amount of child support payable in respect of that carer.

  “(3) Every notification of a change must be accompanied by such documentation as the Commissioner requires.

  “(4) The Commissioner may disregard subsection (2), and may determine the date on which a particular change in living circumstances is to be treated as having occurred, in any case where 2 or more people give notice under this section relating to the same change, and the application of subsection (2) would result in the same change having to be treated as having occurred on different days in relation to different people.”

• “(a) that the liability of a liable parent to pay child support to a carer in respect of the child has ceased in accordance with section 25 or 62; or

• “(b) that an event or change of circumstances has occurred that alters the respective liability or entitlement of any parent or carer of the qualifying child,—”.

“88 Notice of assessment of formula assessment of child support

• “(1) The Commissioner must give written notice (a notice of assessment) to each parent and receiving carer of a qualifying child—

  • “(a) as soon as practicable after making an assessment under section 28A; and

  • “(b) after making any assessment that changes—

    • “(i) the amount of child support payable by a liable parent in respect of the child; or

    • “(ii) the respective amounts payable in respect of different receiving carers; and

  • “(c) at the beginning of each later child support year.

  “(2) The notice of assessment must set out, as a minimum, the relevant matters identified in section 88A, but in no case may a notice of assessment reveal any more detail about another person who is a parent or carer than the person's name (subject to subsection (5)) and, in relation to a qualifying child, the person's proportion of care and care cost percentage.

  “(3) Except as required by Without limiting subsection (2), the notice of assessment must contain sufficient information to enable the recipient to exercise his or her rights to object under section 90 or 91.

  “(4) The notice must also include, or be accompanied by, statements that specifically draw to the attention of the recipient the recipient's right to—

  • “(a) object under section 90 or 91 if he or she is aggrieved by any of the particulars of the assessment; and

  • “(b) apply to the Commissioner under Part 6A; and

  • “(c) apply to a Family Court under Part 7.

  “(5) The Despite anything in this section, the Commissioner may omit from a notice of assessment or any related communication the name of any parent or carer if—

  • “(a) he or she is satisfied that revealing the name to the recipient of the notice would be prejudicial to the safety of any parent, carer, or child; or

  • “(b) the parent is deceased, or is a parent in respect of whom an assessment has not been made.

“88A Details in notices of assessments

• “(1) A notice of assessment given to a liable parent must set out all of the following that are applicable in relation to each qualifying child to whom the notice relates:

  • “(a) the child's first names and date of birth:

  • “(b) the names of the child's other parents (subject to section 88(5)):

  • “(c) the names of any non-parent receiving carers of the child (subject to section 88(5)):

  • “(d) the proportion of ongoing daily care that the Commissioner has established (under section 14) that the liable parent provides to the child:

  • “(e) the care cost percentage of the liable parent in relation to the child, as determined under section 16:

  • “(f) the liable parent's adjusted taxable income:

  • “(g) the first names and date of birth of every dependent child (as defined in section 35(3)) of the liable parent and the amount of the dependent child allowance for each dependent child:

  • “(h) the amount of any multi-group allowance to which the liable parent is entitled:

  • “(i) the liable parent's child support income amount in relation to the child:

  • “(j) the combined child support income amounts of the liable parent and all the child's other parents, in relation to the child:

  • “(k) the liable parent's income percentage in relation to the child.

  “(2) A notice of assessment given to a parent of a child who is a receiving carer must set out all of the following that are applicable in relation to each qualifying child to whom the notice relates:

  • “(a) the child's first names and date of birth:

  • “(b) the names of the child's liable parent or parents, and of any other parents (subject to section 88(5)):

  • “(c) the names of any non-parent receiving carers of the child (subject to section 88(5):

  • “(d) the proportion of ongoing daily care that the Commissioner has established (under section 14) that the parent provides to the child:

  • “(e) the care cost percentage of the parent in relation to the child, as determined under section 16:

  • “(f) the parent's adjusted taxable income:

  • “(g) the first names and date of birth of every dependent child (as defined in section 35(3)) of the parent and the amount of the dependent child allowance for each dependent child:

  • “(h) the amount of any multi-group allowance to which the parent is entitled:

  • “(i) the parent's child support income amount in relation to the child:

  • “(j) the combined child support income amounts of the parent and all the child's other parents in relation to the child:

  • “(k) the parent's income percentage in relation to the child.

  “(3) A notice of assessment given under this section to a non-parent receiving carer of a child must set out all of the following that are applicable in relation to each qualifying child to whom the notice relates:

  • “(a) the child's first names and date of birth:

  • “(b) the names of the child's liable parent or parents, and any other parents (subject to section 88(5)):

  • “(c) the names of any other non-parent receiving carers of the child (subject to section 88(5)):

  • “(d) the proportion of ongoing daily care that the Commissioner has established (under section 14) that the carer provides to the child:

  • “(e) the care cost percentage of the carer in relation to the child, as determined under section 16:

  • “(f) the expenditure on each child for whom the carer provides care, as determined by the relevant child expenditure table:

  • “(g) the amount of child support payable by each of the child's liable parents in respect of the carer.

“89 Notification by Commissioner to other payers and payees

• “(1) The Commissioner must give written notice under this section to every person who is required under this Act to make payments, and every person entitled under this Act to receive payments, of—

  • “(a) domestic maintenance; or

  • “(b) child support under a voluntary agreement; or

  • “(c) child support under a court order.

  “(2) The notice must set out—

  • “(a) the amount of domestic maintenance or child support payable; and

  • “(b) the name of the payer and the payee; and

  • “(c) in the case only of a notice relating to child support, the name of each child in respect of whom payment is to be made.

  “(3) The notice must be given—

  • “(a) as soon as practicable after determining the amount payable in respect of a child support year; and

  • “(b) after making any assessment that changes the amount payable.

  “(4) The notice must contain sufficient information to enable the recipient to exercise his or her rights to object under section 90 or 91.

  “(5) The notice must also include, or be accompanied by, statements that specifically draw to the attention of the recipient his or her right to—

  • “(a) object under section 90 or 91 if he or she is aggrieved by any of the particulars of the assessment; and

  • “(b) apply to a Family Court under Part 7.”

• “(1A) For the purposes of subsection (1)(a), a liable person's income during a period of long-term hospitalisation does not include any amounts received by the person during that hospitalisation for, or in respect of, any time up to and including the day on which the period of hospitalisation began.”

• “(1A) For the purposes of subsection (1)(a), a liable person's income during a period of long-term imprisonment does not include any amounts received by the person during that imprisonment for, or in respect of, any time up to and including the day on which the period of imprisonment began.”

• “(a) a decision to make, or refuse to make, a formula assessment of child support:

• “(b) a decision under section 14 establishing the proportion of ongoing daily care that a carer provides to a qualifying child:

• “(ba) a decision as to whether a particular child is or is not a dependent child of a person:”.

• “(d) a decision that a penalty has been imposed by operation of section 45 or 134:”.

• “(ha) a decision made under section 82(4) determining the date on which a change in living circumstances occurred:”.

• “(a) that, in relation to an assessment of financial support, the amount payable under the assessment in any child support year is incorrect; or”.

• “(2) An objection under this section may be made by any person who is affected by the assessment.”

• “(3A) An objection against a decision referred to in section 90(1)(b) (about the proportion of care that a carer provides to a child) must be based only on the information that was before the Commissioner at the time the decision establishing the proportion of care was made.”

• “(2) The parties to the proceedings under this Part are—

  • “(a) the parent (who may, but need not, be a liable parent) who is the subject of a review under this Part (the subject parent); and

  • “(b) any receiving carer, whether a parent or non-parent, of the child who elects, under section 96Y, to become a party; and

  • “(c) a liable parent who is not the subject parent, but who elects, under section 96Y, to become a party.”

• “(i) of high costs incurred by a parent or a receiving carer in enabling a parent or receiving carer to have contact with the child; or”.

• “(3) For the purposes of subsection (2)(b)(i), costs incurred in enabling a parent or receiving carer to have contact with the child are not to be taken to be high unless the total of those costs during a child support year is more than 5% of the adjusted taxable income for the year of the person incurring the costs.”

• “(1) In determining an application made under section 104, a court may make any of the following orders:

  • “(a) an order departing from some or all of the provisions of this Act by substituting a different amount for any of the following amounts applied or determined under as they relate to a formula assessment, or prescribing an amount or a percentage by which any of those amounts must be varied:

    • “(i) a person's adjusted taxable income:

    • “(ii) a person's living allowance:

    • “(iii) a person's dependent child allowance:

    • “(iv) a person's child support income amount:

    • “(v) the child expenditure amount applying in respect of a qualifying child; or:

  • “(b) an order departing from some or all of the provisions of this Act relating to the formula assessment of child support in relation to the child and, as a result,—

    • “(i) substituting a different annual amount of child support payable by a liable parent for a specified period in place of the amount determined under a formula assessment; or

    • “(ii) prescribing an amount or a percentage by which the annual amount of child support payable by a liable parent for a specified period must vary from the amount determined under a formula assessment; or:

  • “(c) an order that the provisions of this Act relating to a formula assessment of child support must not be departed from in relation to a particular child.”

• “(a) the payee has—

  • “(i) waived under section 179A the right to the payment to which the penalty relates; or

  • “(ii) uplifted under section 180 the debt to which the penalty relates; and”.

“152B Offsetting child support payments

• “(1) If 2 parents of a child are each to be liable to pay the other an amount payable under a formula assessment for of child support, the Commissioner may at any time before both of the amounts of child support concerned become due and payable offset one liability against the other.

  “(2) However, the Commissioner may not cannot exercise this power in respect of any liability of a parent in respect of a period if during that period the parent who is, at the time, is expected to be a social security beneficiary (as defined in section 2(1)).”

“179A Waiver of right to payment

• “(1) A payee who is a non-parent receiving carer (other than a social security beneficiary) of a qualifying child (other than a payee who is in receipt of an unsupported child's benefit for that child) may, by notice to the Commissioner, waive their right to receive some or all the child support payments yet to be paid by from a liable parent.

  “(2) The notice takes effect as a waiver on the date specified in the notice; but if no date is specified, it takes effect on the date on which the notice is received by the Commissioner.

  “(3) On and from the date on which a waiver takes effect, any amount of money that is or becomes unpaid and in arrear, to the extent that the payee has waived their right to receive payment, ceases to be a debt payable by the liable parent to the Crown under this Act.

  “(3) On and from the date on which a waiver takes effect, no unpaid child support payments constitute a debt payable by the liable parent to the Crown, whether the payments were due before, on, or after the date on which the waiver takes effect.

  “(4) A waiver under this section is revocable at any time, by notice to the Commissioner, and the revocation takes effect on the later of the following:

  • “(a) the date specified in the notice:

  • “(b) the date on which the notice is received by the Commissioner.

  “(5) A waiver under this section is deemed to be revoked if, and on the date that, the person to whom it relates becomes a social security beneficiary payee begins to receive an unsupported child's benefit for the child to whom the waiver relates.

  “(6) If a waiver is revoked, the liable parent must pay the child support due in relation to the child from the date the revocation takes effect, and must pay it within 30 days after the date on which the notice of revocation is given to the liable parent.”

• “(d) any income amount; or

• “(e) the annual rate of child support.”

“237 Rounding of amounts

• “(1) The following amounts must be rounded to whole dollars:

  • “(a) late payment penalties:

  • “(b) the amounts identified in the child expenditure table approved under section 36D:

  • “(c) the living allowances as identified in section 34(2):

  • “(d) the minimum annual rate of child support referred to in section 72(1)(a).

  “(2) Except as provided elsewhere in this Act, the Commissioner may round any other amount referred to in, or arrived at in accordance with, this Act to a whole dollar or to any amount less than a whole dollar.

  “(3) If an amount that is rounded to a whole dollar consists of a number of whole dollars and 50 cents, the amount must be rounded down to the nearest whole dollar.”

“237A Rounding of other numbers

• For the purpose of any calculation under this Act, every if a number (not being a dollar amount) is rounded, it must be rounded to no more than 2 decimal places.”

“276 Application, savings, and transitional Transitional and savings provisions relating to amendments to Act

• The application, savings, and transitional and savings provisions set out in Schedule 1AA, which relate to amendments to this Act that come into force on and after 1 April 2014, have effect for the purposes of this Act.”

(c) for child support purposes, details of the parentage, birth, and death of qualifying children or dependent children

• “(d) that, at any time within 3 years starting on the date on which the child's parents ceased to live together in a marriage, civil union, or de facto relationship, the application in relation to the child of the provisions of this Act relating to formula assessment of child support would result in an unjust and inequitable determination of the level of financial support to be provided by the liable parent for the child because a re-establishment costs situation exists under subsection (7).”

• “(7) A re-establishment costs situation exists under this subsection for the purposes of subsection (2)(d) if, and only if,—

  • “(a) the adjusted taxable income of a parent of the child for the child support year concerned includes a proportion that is—

    • “(i) no more than 30% of that income; and

    • “(ii) income from work done by that parent and that, in quantity or nature or both, is additional to work that he or she did before the child's parents ceased to live together in a marriage, civil union, or de facto relationship; and

  • “(b) some or all of that proportion of that income is used, or needs to be used, by a parent of the child in that child support year to meet, wholly or partly, actual and reasonable costs incurred to re-establish himself or herself, and any child or other person that he or she has a duty to maintain, after the child's parents ceased to live together in a marriage, civil union, or de facto relationship.

• “(8) In computing, for the purposes of subsection (2)(d), the 3-year period after the child's parents ceased to live together in a marriage, civil union, or de facto relationship, the court may exclude a period or periods of resumed cohabitation with, or each with, the sole or main motive of reconciliation if that period does not exceed, or those periods in aggregate do not exceed, 3 months.”

“Financial support to be collected only by automatic deduction or other method acceptable to Commissioner

“129 Financial support generally to be paid only by automatic deduction

• “(1) All financial support that an automatic deduction person is required by this Act to pay on or after 1 April 2015 must be paid only by way of automatic deduction under Part 10 except insofar as the Commissioner considers that method inappropriate.

  “(1A) The Commissioner considers automatic deduction under Part 10 to be an inappropriate method of payment for some or all of the financial support specified in subsection (1) only if, and to the extent that, all or any of the following apply:

  • “(a) the Commissioner considers automatic deduction under Part 10 of that financial support (or of that part of it) to be administratively inappropriate:

  • “(b) the Commissioner grants recognition under section 131(1) of qualifying payments for the child's direct benefit made by the automatic deduction person:

  • “(c) the automatic deduction person is, in the Commissioner's discretion, permitted for cultural reasons, privacy reasons, or other exceptional reasons to pay that financial support (or that part of it) by a payment method or methods (other than automatic deduction under Part 10) acceptable to the Commissioner.

  “(1B) The Commissioner's discretion under subsection (1A)(c) is exercisable on an application for the purpose or on the Commissioner's own motion.

  “(2) Automatic deduction person, in this section and section 130, means (subject to subsections (3) to (5)) a person who is 1 or more of the following:

  • “(a) a person who is a PAYE or ACC income recipient, but only if or to the extent that he or she is not a person who is in receipt of a benefit specified in paragraph (c) or a grant specified in paragraph (d):

  • “(b) a person who, on or after 1 April 2015, defaults in a payment of financial support under this Act:

  • “(c) a person who is in receipt of a benefit under the Social Security Act 1964, the Social Welfare (Transitional Provisions) Act 1990, Part 6 of the War Pensions Act 1954, or the New Zealand Superannuation and Retirement Income Act 2001:

  • “(d) a person who is in receipt of a basic grant or an independent circumstances grant under the Student Allowances Regulations 1998.

  “(3) PAYE or ACC income recipient, in subsection (2)(a), means a person whose income is or includes either or both of the following:

  • “(a) income specified in paragraph (a) of the definition of withholding income in section 2(1):

  • “(b) earnings related compensation (as defined in section 82(9) of the Tax Administration Act 1994).

  “(4) A person mentioned in subsection (2)(a) to (d) is an automatic deduction person regardless of whether the person's liability to pay that financial support arises before, on, or after 1 April 2015.

  “(5) A person mentioned in subsection (2)(a), (c), and (d) is an automatic deduction person regardless of whether the person defaults or has defaulted in a payment or payments of that financial support.

  “(6) Automatic deduction required by subsection (1) in respect of a person specified in subsection (2)(c) must be from an instalment of a benefit to which the person is or may become entitled under the Act or Part specified in subsection (2)(c).

“130 Payments to be made by other methods if automatic deduction not required or inappropriate

• All financial support that a person is required by this Act to pay on or after 1 April 2015 must be paid by a payment method or methods (other than automatic deduction under Part 10) acceptable to the Commissioner to the extent that either or both of the following apply:

  • “(a) the person is not an automatic deduction person (as defined in section 129(2) to (5)):

  • “(b) the Commissioner under section 129(1) considers payment of financial support referred to in section 129(1) by way of automatic deduction under Part 10 to be inappropriate.

“131 Payment of child support by recognition of qualifying payments for child's direct benefit

• “(1AA) The other payment method or methods referred to in section 130 may be, for some or all of the child support for a child in respect of a child support year, payment by way of recognition under this section of 1 or more qualifying payments for the child's direct benefit.

  “(1AB) A qualifying payment for the child's direct benefit, in this section and section 131A, means a payment that is made—

  • “(a) by or on behalf of the liable parent, and to a person other than the Commissioner; and

  • “(b) for goods or services that benefit directly the child (regardless of whether they also benefit, directly or indirectly, any other person).

  “(1) The Commissioner may, to enable the liable parent to pay some of the child support for a child that this Act requires the liable parent to pay in a child support year, recognise under this section on a written application for the purpose 1 or more payments if, and only if, there is compliance with the conditions in section 131A.—

  • “(a) on an application for the purpose in a form acceptable to the Commissioner; and

  • “(b) if, and only if, there is compliance with the conditions in section 131A.

  “(2) The Commissioner may, in the Commissioner's discretion,—

  • “(a) recognise under subsection (1), for child support for a child in respect of a child support year, a payment made in an earlier child support year (despite section 131A); and

  • “(b) amend or revoke, if the Commissioner considers that changes to circumstances make it necessary or desirable to do so, any recognition under paragraph (a) of the payment.

  “(2) The Commissioner may, in the Commissioner's discretion (and despite section 131A(1)(e)(i)), recognise under subsection (1), for child support for a child in respect of a child support year, a payment made within the last 12 months.

  “(3) If asked to recognise a payment (or under section 131B to amend or revoke recognition of a payment) under subsection (1), the Commissioner may require a parent or carer of the child to produce any evidence that the Commissioner, in his or her discretion, considers appropriate to enable the Commissioner to decide whether to do so.

  “(3A) Recognition under subsection (1) granted during a month takes effect at the start of the next month.

  “(3B) Recognition under subsection (1) ceases at the end of the day before the day on which any of the following occurs:

  • “(a) the liable parent who has made the payment provides in the child support year ongoing daily care for the child, established under section 14, that is or exceeds 28%:

  • “(b) the liable parent who has made the payment ceases to be liable to pay child support for the child:

  • “(c) a receiving carer in respect of the child starts to receive a social security benefit (as defined in section 2(1) of this Act).

  “(3C) The Commissioner may revoke recognition under subsection (1) if, after the recognition takes effect, the liable parent fails to pay an amount of child support by the time that the amount is due and payable.

  “(3D) If recognition of a qualifying payment is revoked under subsection (2)(b) or (3C),—

  • “(a) the Commissioner must as soon as practicable give the liable parent written notice of the revocation; and

  • “(b) the liable parent must pay within 30 days of the date of that written notice of the revocation, and using another permitted payment method, every amount of child support that was to be, but on the revocation had not been, paid by recognition of the qualifying payment.

  “(3E) Recognition under subsection (1) and that involves a particular liable parent may be applied for and granted under this section even though earlier recognition of that kind was applied for and granted but ceased or was revoked under this section section 131B.

  “(4) For the purposes of section 96 (which identifies matters with respect to which Part 6 does not confer any right of objection), all decisions under this section and sections 131A and 131B are matters left by those sections to the discretion of the Commissioner.

“131A Conditions for recognition of payments under section 131

• “(1) The conditions for recognition referred to in section 131(1) are as follows:

  • “(a) the liable parent who has made the payment is not, at the time that the application for recognition is made, providing ongoing daily care for the child, established under section 14, that is or exceeds 28%; and

  • “(b) the liable parent and a receiving carer have at any time during the child support year entered into, and given the Commissioner, an agreement that complies with subsection (2); and

  • “(c) no receiving carer who is a party to the agreement is, at the time that the application for recognition is made, a social security beneficiary; and

  • “(d) no party to the agreement has, at the time that the application for recognition is made, child support debt (which, under section 134A(b), may be debt that is or includes related penalties) that remains unpaid after the time it became due and payable; and

  • “(e) the Commissioner is satisfied, on the basis of information available to the Commissioner, that—

    • “(i) each payment to be recognised is a qualifying payment for the child's direct benefit made at a time that is within 12 months before the time that the Commissioner receives the application for recognition; and

    • “(ii) the amount of the payment or payments to be recognised is at least 10% of the child support liability for the child for the child support year at the time that the application for recognition is made.

  “(2) An agreement referred to in subsection (1)(b) complies with this subsection if it—

  • “(a) is written on, or is in writing and contains all the material information required by, a form approved for the purpose by the Commissioner; and

  • “(a) is in a form acceptable to, and contains all the material information required by, the Commissioner; and

  • “(b) identifies the payments that the parties to the agreement want to be recognised; and

  • “(c) identifies the child to whom those payments relate; and

  • “(d) identifies how the recognised payments will be used to satisfy monthly child support liabilities; and

  • “(e) is signed agreed to by the parties to it.

  “(3) Recognition under section 131(1) of a qualifying payment is not affected, and must not be revoked under section 131(2)(b) or (3C), if a reassessment after recognition of the qualifying payment results in either or both of the following:

  • “(a) a debt that did not exist at the time of the recognition of the qualifying payment:

  • “(b) the amount of the qualifying payment being less than 10% of the child support for the child for the child support year.

“131B Effect, amendment, and cessation of recognition under section 131

• “(1) Recognition under section 131(1) granted during a month takes effect at the start of the next month.

  “(2) Recognition under section 131(1) ceases (if not earlier revoked) at the end of the day before the day on which any of the following occurs:

  • “(a) the liable parent who has made the payment provides in the child support year ongoing daily care for the child, established under section 14, that is or exceeds 28%:

  • “(b) the liable parent who has made the payment ceases to be liable to pay child support for the child:

  • “(c) a receiving carer in respect of the child starts to receive a social security benefit (as defined in section 2(1) of this Act).

  “(3) The Commissioner may revoke recognition under section 131(1) with immediate effect if, after the recognition takes effect, the liable parent fails to pay an amount of child support by the time that the amount is due and payable.

  “(4) The Commissioner may, in the Commissioner's discretion, amend or revoke any recognition under section 131(1) of a qualifying payment (with effect at a time at or after the amendment or revocation the Commissioner identifies) if the Commissioner considers that changes to circumstances make it necessary or desirable to do so.

  “(5) Recognition under section 131(1) of a qualifying payment is not affected, and must not be revoked under this section, if a reassessment after recognition of the qualifying payment results in either or both of the following:

  • “(a) a debt that did not exist at the time of the recognition of the qualifying payment:

  • “(b) the amount of the qualifying payment being less than 10% of the child support for the child for the child support year.

  “(6) If recognition of a qualifying payment is amended under this section, the Commissioner must as soon as practicable give the liable parent written notice of the amendment.

  “(7) If recognition of a qualifying payment is revoked under this section,—

  • “(a) the Commissioner must as soon as practicable give the liable parent written notice of the revocation; and

  • “(b) the liable parent must pay within 30 days after the date on which notice of the revocation was given by the Commissioner, and using another permitted payment method, every amount of child support that was to be, but on the revocation had not been, paid by recognition of the qualifying payment.”

“134 Penalties for late payment of financial support debts

• “Late payment penalties (initial and incremental)

  “(1) A person liable to pay a financial support debt (whether that debt is incurred before, on, or after 1 April 2015) is liable to pay to the Commissioner a penalty of the amount stated in subsection (2), (3), (4), (5), or (6) if—

  • “(a) the time stated in that subsection (which is a time after the time at which all of the debt became due and payable) occurs on or after 1 April 2015; and

  • “(b) at the time stated in that subsection, some or all of the debt remains unpaid.

  “Initial late payment penalty: due date

  “(2) At the expiry of the due date, the penalty is the greater of the following amounts:

  • “(a) the amount of $5; and

  • “(b) an amount equal to 2% of the amount of financial support remaining unpaid at the expiry of the due date.

  “Initial late payment penalty: seventh day after due date

  “(3) At the expiry of the seventh day after the due date, the penalty is an amount equal to 8% of so much (if any) of the amount of financial support (excluding the penalty imposed under subsection (2)) remaining unpaid at that expiry.

  “Incremental late payment penalty: first month after due date

  “(4) At the expiry of the period of 1 month that starts on the day after the due date, the penalty is an amount equal to 2% of so much (if any) of the sum of the following as remains unpaid at that expiry:

  • “(a) the amount of financial support remaining unpaid at the expiry of the due date:

  • “(b) all penalties, if any, imposed under either of subsections (2) and (3).

  “Incremental late payment penalty: first 11 later months

  “(5) At the expiry of each of the first 11 periods of 1 month (if any) that, consecutively, follow the 1-month period referred to in subsection (4), the penalty is an amount equal to 2% of so much (if any) of the sum of the following as remains unpaid at that expiry:

  • “(a) the amount of financial support remaining unpaid at the expiry of the due date:

  • “(b) all penalties, if any, imposed under any of subsections (2) to (4):

  • “(c) all penalties, if any, earlier imposed under this subsection.

  “Incremental late payment penalty: months after 1 year

  “(6) At the expiry of each of the periods of 1 month (if any) that, consecutively, follow the last of the 11 periods of 1 month referred to in subsection (5), the penalty is an amount equal to 1% of so much (if any) of the sum of the following as remains unpaid at that expiry:

  • “(a) the amount of financial support remaining unpaid at the expiry of the due date:

  • “(b) all penalties, if any, imposed under any of subsections (2) to (5):

  • “(c) all penalties, if any, earlier imposed under this subsection.

  “Compare: 1976 No 65 s 398; 1985 No 141 s 41

“134A Status of penalties under section 134

• A penalty payable under section 134—

  • “(a) is a debt due to the Crown; and

  • “(b) must for all purposes (except the purposes of Part 9) be treated as, and is accordingly recoverable as if it were, of the same nature as the amount in respect of which it was imposed.

  “Compare: 1976 No 65 s 398; 1985 No 141 s 41

“134B Act's provisions on liable people's person's financial support debt also apply to payees' debts arising from overpayments

• This Act's provisions on a liable person's financial support debt (including, without limitation, sections 134 and 135 to 135N) also apply, in accordance with sections 151(2) and 151AA(5) and (6), to payees' debts arising from overpayments.”

“incremental penalty means a penalty that is imposed—

• “(a) before 1 April 2015 under section 134(1)(b) or (c) (as repealed by the Child Support Amendment Act 2011); or

• “(b) on or after 1 April 2015 under section 134(4), (5), or (6) (as substituted by the Child Support Amendment Act 2011)

“initial late payment penalty means a penalty that is imposed—

• “(a) before 1 April 2015 under section 134(1)(a) (as repealed by the Child Support Amendment Act 2011); or

• “(b) on or after 1 April 2015 under section 134(2) or (3) (as substituted by the Child Support Amendment Act 2011)”.

“Sufficient reason for declining to enter into or make payment agreement

“135AA Non-compliance without reasonable cause with previous payment agreements

• “(1) The Commissioner may decline to enter into a payment agreement with a liable person solely for the reason that the Commissioner is satisfied on the basis of information available to the Commissioner of both of the following matters:

  • “(a) that the liable person has not complied with 1 or more earlier payment agreements; and

  • “(b) that no reasonable cause existed for the liable person's non-compliance with all or any of those agreements.

  “(2) This section does not prevent the Commissioner from—

  • “(a) declining to enter into the agreement for any other reason; or

  • “(b) ceasing, because of further information available to the Commissioner, to be satisfied of either or both of those matters.

  “(3) For the purposes of section 96 (which identifies matters with respect to which Part 6 does not confer any right of objection), the Commissioner's decision whether to enter into or make a payment agreement is a matter left by this section to the discretion of the Commissioner.”

“135FA Discretionary relief from incremental penalties unpaid before agreement entered into on or after 1 April 2015

• “(1) For the purposes of this section,—

  “initial debt, in relation to a payment agreement, means the amount the liable person owes at the time that the agreement is entered into in respect of financial support and initial late payment penalties

  “payment agreement means an agreement entered into on or after 1 April 2015 between a liable person and the Commissioner that requires the liable person to pay, in 1 sum or 2 or more instalments of specified amounts,—

  • “(a) the amount of the initial debt; and

  • “(b) the amount of financial support (if any) that the person will become liable to pay during the term of the payment agreement.

  “(2) The Commissioner may grant relief to the liable person in the manner prescribed by section 135A in respect of the incremental penalties of the liable person that were unpaid at the time a payment agreement was entered into if the Commissioner is satisfied that recovery of those incremental penalties would do either or both of the following:

  • “(a) place the liable person in serious hardship (as defined in section 135G(3)):

  • “(b) involve an inefficient use of the Commissioner's resources.

  “(3) Before making a decision under subsection (2)(b), the Commissioner must have regard to the matters referred to in sections 6 and 6A of the Tax Administration Act 1994.”

“135GA Discretionary relief for residual penalty-only debt

• “(1) The Commissioner may grant relief to a liable person from the payment of initial late payment penalties or incremental penalties or both in the manner prescribed by section 135A if—

  • “(a) the liable person has paid, or had written off in accordance with this Act, all of the liable person's financial support debt; and

  • “(b) the Commissioner is satisfied that recovery of those penalties would involve an inefficient use of the Commissioner's resources.

  “(1A) The Commissioner may grant relief to a liable person from the payment of initial late payment penalties, or incremental penalties, or both, in the manner prescribed by section 135A, if—

  • “(a) the Commissioner has under section 180A written off all of the benefit component of an amount of child support (as defined in section 180A(2)) that is payable by the liable person to the Crown under this Act; and

  • “(b) the Commissioner is satisfied that those penalties relate to, or arise from, all of that written-off benefit component, and that recovery of those penalties would involve an inefficient use of the Commissioner's resources. do either or both of the following:

    • “(i) place the liable parent in serious hardship (as defined in section 135G(3)):

    • “(ii) involve an inefficient use of the Commissioner's resources.

  “(2) Before making a decision under subsection (1)(b) or (1A)(b), the Commissioner must have regard to the matters referred to in sections 6 and 6A of the Tax Administration Act 1994.”

“135GB Relief from initial late payment penalty if full or substantial compliance with payment arrangement entered into or made on or after 1 April 2015 and within 3-month period

• “(1) The Commissioner must write off an initial late payment penalty if satisfied that—

  • “(a) that penalty was imposed in respect of a debt that is or includes the first payment of financial support payable by the liable person under a formula assessment, voluntary agreement, or order of the court issued or made before, on, or after 1 April 2015; and

  • “(b) a payment arrangement was entered into or made on or after 1 April 2015 and within the 3 months that began on the date of issue or making of the assessment, agreement, or order under which that first payment is payable, and has been fully or substantially complied with in accordance with subsection (5).

  “(2) The payment arrangement referred to in subsection (1)(b) must be a payment agreement specified in subsection (3) or a deduction notice specified in subsection (4).

  “(3) The payment agreement is one that the liable person entered into with the Commissioner to pay, in 1 sum or 2 or more instalments of specified amounts,—

  • “(a) the first payment mentioned in subsection (1)(a); and

  • “(b) other payments of financial support that were or would become payable (under the assessment, agreement, or order mentioned in subsection (1)(a), or any other assessment, voluntary agreement, or order of the court) by the liable person.

  “(4) The deduction notice is one that the Commissioner gave a person under section 154 in relation to the liable person in order to collect, in 1 sum or 2 or more deductions and payments,—

  • “(a) the first payment mentioned in subsection (1)(a); and

  • “(b) other payments of financial support that were or would become payable (under the assessment, agreement, or order mentioned in subsection (1)(a) or any other assessment, voluntary agreement, or order of the court) by the liable person.

  “(5) The payment arrangement referred to in subsection (1)(b) has been fully or substantially complied with in accordance with this subsection if the arrangement has operated for a period that the Commissioner considers reasonable and—

  • “(a) it is a payment agreement, and to date there has been either no default in the payment in accordance with that agreement of the 1 sum, or every one of the 2 or more instalments, specified in subsection (3), or only default of that kind to an extent, or arising from a cause, that the Commissioner considers reasonable; or

  • “(b) it is a deduction notice, and to date there has been either no default in the making in accordance with that notice of every one of the 2 or more deductions and payments specified in subsection (4), or only default of that kind to an extent, or arising from a cause, that the Commissioner considers reasonable.

  “(6) If an initial late payment penalty written off under subsection (1) has been paid in whole or in part, the Commissioner must refund to the liable person the whole or part of the penalty paid.

“135H Relief from initial late payment penalty if full compliance with payment arrangement entered into or made before 1 April 2015 and within 3-month period

• “(1) The Commissioner must write off an initial late payment penalty if satisfied that—

  • “(a) that penalty was imposed in respect of a debt that is or includes the first payment of financial support payable by the liable person under a formula assessment, voluntary agreement, or order of the court issued or made before, on, or after 1 April 2015; and

  • “(b) a payment arrangement was entered into or made on or after 26 September 2006 and before 1 April 2015 and within the 3 months that began on the date of issue or making of the assessment, agreement, or order under which that first payment is payable, and has been fully complied with in accordance with subsection (5).

  “(2) The payment arrangement referred to in subsection (1)(b) must be a payment agreement specified in subsection (3) or a deduction notice specified in subsection (4).

  “(3) The payment agreement is one that the liable person entered into with the Commissioner to pay, in 1 sum or 2 or more instalments of specified amounts,—

  • “(a) the first payment mentioned in subsection (1)(a); and

  • “(b) other payments of financial support that were or would become payable (under the assessment, agreement, or order mentioned in subsection (1)(a), or any other assessment, voluntary agreement, or order of the court) by the liable person.

  “(4) The deduction notice is one that the Commissioner gave a person under section 154 in relation to the liable person in order to collect, in 1 sum or 2 or more deductions and payments,—

  • “(a) the first payment mentioned in subsection (1)(a); and

  • “(b) other payments of financial support that were or would become payable (under the assessment, agreement, or order mentioned in subsection (1)(a) or any other assessment, voluntary agreement, or order of the court) by the liable person.

  “(5) The payment arrangement referred to in subsection (1)(b) has been fully complied with in accordance with this subsection if—

  • “(a) it is a payment agreement, and the 1 sum, or every one of the 2 or more instalments, specified in subsection (3) is paid in full in accordance with that agreement; or

  • “(b) it is a deduction notice, and every one of the 2 or more deductions and payments specified in subsection (4) is made in accordance with that notice.

  “(6) If an initial late payment penalty written off under subsection (1) has been paid in whole or in part, the Commissioner must refund to the liable person the whole or part of the penalty paid.”

• “(1) This section applies if—

  • “(a) an incremental penalty is by operation of law imposed on a person at the expiry of a 1-month period; and

  • “(b) during that 1-month period, the person is liable to pay financial support, initial late payment penalties, or incremental penalties that are payable in 1 sum, or in 2 or more instalments, under a payment agreement entered into between the person and the Commissioner; and

  • “(c) every sum or instalment payable under the payment agreement during that 1-month period has during that 1-month period been paid in full in accordance with the payment agreement.”

• “(1) This section applies if—

  • “(a) an incremental penalty is by operation of law imposed on a person at the expiry of a 1-month period; and

  • “(b) during that 1-month period, the person is liable to pay financial support, initial late payment penalties, or incremental penalties by way of deductions required to be made, and paid to the Commissioner, under a deduction notice given under section 154; and

  • “(c) each deduction required during that 1-month period to be made, and paid to the Commissioner, under the deduction notice has during that 1-month period been made (even if it has not also been paid to the Commissioner) in accordance with the deduction notice.”

“151AA Overpayments to payees on or after 1 April 2015

• “(1) This subsection applies to an amount that on or after 1 April 2015 is paid to a payee under any provision of this Part if—

  • “(a) the payee was not entitled to be paid the amount; or

  • “(b) the amount is, because of a subsequent variation in the liability of the liable person, repayable by the Commissioner to the liable person; or

  • “(c) the amount is, because of a subsequent variation in the entitlement of the payee, in excess of the amount properly payable to the payee under this Act.

  “(2) An amount to which subsection (1) applies is, if that amount is assessed by the Commissioner in the exercise of the Commissioner's discretion under subsection (3),—

  • “(a) repayable by the payee to the Commissioner; and

  • “(b) a debt due by the payee to the Crown.

  “(3) The Commissioner may assess an amount to which subsection (1) applies.

  “(4) An assessment under subsection (3) must be in writing, and must be copied to the payee.

  “(4) The Commissioner must notify the payee in writing of the assessment under subsection (3).

  “(5) This Act (subject to subsection (6)) applies to the amount assessed, and to the payee, as if—

  • “(a) that amount was financial support; and

  • “(b) the payee was a liable person.

  “(6) Sections 134, 134A, and 135 to 135N (which relate to penalties and to relief from them) apply to an amount assessed under subsection (3) and to the payee unless the Commissioner, in the Commissioner's discretion under this subsection, determines in writing copied to the payee that all of those sections do not apply to the amount assessed.

  “(7) A The Commissioner must notify the payee in writing of a determination under subsection (6), and the determination may be combined with, or later than and separate from, an assessment under subsection (3).

  “(8) If the payee is entitled to receive further payments under any provision of this Part, the amount of the debt due to the Crown by the payee may be recovered by reducing such of those payments by such amount as is determined in writing by the Commissioner.”

“152B Offsetting child support payments

• “(1) If 2 parents of a child are each liable to pay the other an amount of, or of the same nature as, child support, whether that amount is by way of New Zealand child support, foreign child support, or both (as those terms are defined in section 214) and whether or not those amounts have become due and payable, the Commissioner may offset one liability against the other.

  “(2) One or both of the 2 parents' liabilities that the Commissioner offsets under subsection (1) may be, wholly or in part, all or any of the following:

  • “(a) liabilities in respect of the 2 parents caring at different times for the same child:

  • “(b) liabilities in respect of the 2 parents caring at the same time for 2 or more different children of both of the 2 parents:

  • “(c) liabilities in respect of the current year or child support year, or 1 or more previous years or child support years:

  • “(d) liabilities in respect of child support payable under this Act:

  • “(e) liabilities in respect of child support under an arrangement given force and effect in relation to New Zealand by an Order in Council under section 215 (adoption of reciprocal agreement with other countries).

  “(2A) Subsection (2) does not limit subsection (1).

  “(3) However, the Commissioner may not cannot exercise this power in respect of any liability of a parent in respect of a period if during that period the parent who is, at the time, is expected to be or (as the case requires) was a social security beneficiary (as defined in section 2(1)).”

• “(2) This section does not entitle an election to be made in relation to an amount of child support payable to a payee, other than pursuant to a lump sum order made under section 109,—

  • “(a) under subsection (1)(a), if the amount of child support was payable in respect of a period during which the payee was a social security beneficiary (as defined in section 2(1)); or

  • “(b) under subsection (1)(b), if the payee—

    • “(i) is a social security beneficiary (as so defined) at the time of making the election; or

    • “(ii) is not a social security beneficiary (as so defined) at the time of making the election, and does not also at the same time elect that the liability of the liable parent to pay child support is to end under section 27 or  64 or 70.”

“180A Commissioner may write off benefit component of child support debt if receiving carer is or was social security beneficiary and recovery would place liable person in serious hardship or involve inefficient use of Commissioner's resources cause serious hardship or be inefficient use of Commissioner's resources

• “(1) The Commissioner may write off some or all of the benefit component of an amount of child support that is payable by the liable person to the Crown under this Act, and that is unpaid and in arrear, if—

  • “(a) the amount of child support was payable in respect of a period during which the receiving carer is or was a social security beneficiary (as defined in section 2(1)) at the time the child support is or was payable; and

  • “(b) the Commissioner is satisfied that recovery of that part or, as the case requires, all, of the benefit component of the amount of child support would do either or both of the following:

    • “(i) place the liable person in serious hardship (as defined in section 135G(3)):

    • “(ii) involve an inefficient use of the Commissioner's resources.

  “(2) The benefit component of an amount of child support, in subsection (1), means so much of that amount as is not payable to the receiving carer under section 142(1)(f).

“180B Commissioner may write off child support debt if liable person has died and his or her estate is insufficient

• “(1) The Commissioner may write off some or all of an amount of child support debt that is payable by the estate of a liable person to the Crown under this Act, and that is unpaid and in arrear, if—

  • “(a) the liable person has died; and

  • “(b) the Commissioner is satisfied that the liable person's estate is insufficient to pay the part, or all, of the amount.

  “(2) Subsection (1) applies even if no order has been made that the liable person's estate be administered under Part 6 (insolvent deceased estates) of the Insolvency Act 2006.

“180C Commissioner may write off child support debt if receiving carer has died and it debt is likely to be unable to be recovered

• The Commissioner may write off some or all of an amount of child support debt that is payable by a liable person to the Crown under this Act, and that is unpaid and in arrear, if—

  • “(a) the receiving carer has died; and

  • “(b) the Commissioner is satisfied that the part, or all, of the amount is for any reason likely to be unable to be recovered.”