If your income drops by 15% or more from the income we used in your child support assessment, you may be able to estimate your income for child support. For a liable parent, this may reduce the amount you have to pay. For a receiving carer, this may increase the amount you get.
When you can estimate
You can estimate your income for the current child support year if the following apply.
- You expect your income from 1 April, plus estimated income, to drop by at least 15%.
- Your annualised income for the rest of the year is lower than the income you’ve been assessed on.
- Your child support has not ended, or it has ended but the month your last child support assessment is in has not ended.
- Your income or the payment amount has not been set by court order or child support review.
Changing income set by court order or child support review
If your income or child support payments have been set by court order or child support review, you'll need to go back to court, or apply for a new review if there is a new matter, to change them.
You may need to send us proof of income
When you estimate your income, there may be times we'll need you to send us proof of your estimated income. For example, if your estimate includes income from self-employment or overseas income.
When your estimation starts
If you’re new or returning to child support, and you’ve estimated within 28 days of us notifying you of an assessment, your estimation will start from the first day of the month when the assessment started. This may be in a previous month or year.
For example, we send you a child support assessment letter on 28 December. You estimate your income on 16 January. Your estimation meets the criteria, so we accept it. Your estimation starts from 28 December.
If your income changes again
If your income goes up or down after you’ve estimated, you can re-estimate your income if you still meet the criteria. If you made an estimation less than 3 months ago, your income must have changed by at least $500 before we can accept a new estimation.
If your income goes up after you estimated and you no longer meet the estimation criteria, you may need to cancel your estimation. Otherwise, you may end up with an amount to pay once your child support is squared up.
At the end of the year
After the end of the tax year, usually 31 March, we’ll square up your estimation to see if you paid the right amount of child support.
When we square up your child support, we use the lesser of the following.
- The actual income you earned in the period you estimated.
- The income originally used to work out your child support.
If your income was higher than what you’d estimated, you may have an amount to pay
If your estimation includes overseas income, you'll need to send us proof of this income at the end of the New Zealand financial year (1 April to 31 March).
We originally used $53,700 to assess your child support. You estimate your income at $40,000 from the start of the child support year in April, until the end of the child support year in March. Your child support to pay will be based on this income for the full year.
You earned $40,563 for the full year. We will square up your estimation using this income for the full child support year.
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