Question to the Department for Work and Pensions:

To ask the Secretary of State for Work and Pensions, what steps his Department is taking to (a) identify and (b) investigate suspected under-declaration of income within the Child Maintenance Service.

The Child Maintenance Service (CMS) focuses on maximising compliance and identifying hidden earnings through measures such as data sharing with His Majesty’s Revenue and Customs (HMRC).

Information about the paying parent's gross income is taken directly from HMRC for the latest tax year available. This allows calculations to be made quickly and accurately. Use of historic income ensures a stable calculation, which we know from customer feedback is valued as it enables parents to rely on maintenance for financial planning purposes.

In the event a receiving parent believes a paying parent’s earnings are not captured in the standard calculation using HMRC gross income data, they can apply for a variation, under which certain other categories of income can be considered.

Cases where the CMS has reason to believe Paying Parents may be hiding their income can be investigated by the Financial Investigation Unit. This is a specialist team which can request information from financial institutions (such as banks, investment companies and mortgage companies) to check the accuracy of information that the CMS is given. If any discrepancies are found, they can implement a correct maintenance liability that is supported by CMS legislation.

The department is currently reviewing the calculation to make sure it is fit for purpose.