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As part of the divorce proceeding, both my Ex and I had to sell a property. When my tax return was done they did a backdate so I owed a lot of money. When Ex tax return was processed there was no backdate. Why?

Hi

During the divorce proceeding both my Ex and I were required to sell a property. I sold my property first (before the property settlement had been completed and before my Ex even applied to the CSA) but all funds was placed into a trust fund pending property settlement. After property settlement this trust fund was distributed between the two of us, she got the main house but she had to sell a property she had and all proceeds were to go to me (after captial gains had been done).
Since I had to start up a new house hold and get it all setup for my children (a 50/50 care arranged was achieved) I delayed lodging my tax return until May. Now prior to this the Ex contacted the CSA and they called me asking about my wage. I provided all information but didn't realize about the captial gain from the sale of the property.
Now when I did lodge my tax return this affected my CSA assessment and the CSA promptly gave me a large backdate amount to pay within 3 weeks. I couldn't do this so I was (after multiple phone calls) able to get a payment plan I could handle. Also the CSA did amost double the amount of the regular payments. I contacted the CSA about this and was able to point out that the tax return did not reflect my true income. They accepted that and reduced by regular payments back to the prior level but did not remove the backdate. I did lodge a Special Change of Assessment using item 8 to get the backdate amount back but I have just received a phone call to say that has been refused.
Now my Ex property sold some time later. This means that the CSA had already seen one normal tax return before they received her tax return which had the captial gains. When this occurred there was no backdate, however the amount I need to pay has changed.
I did call the CSA to ask why this was the case and just got told that the different was that I had provided an estimate and my Ex was based on a tax return. I don't understand this at all.
I am now worried that my Ex can just phone the CSA and say that tax return is not an indication of her true income and hence get the regular CSA increased to the prior levels. Is this possible as it only took myself a phone call to do that?
The answer to that does affect what I do with the refusal of my Special Change of Assessment. If my Ex cannot get her taxable income returned to the lower level then I won't bother fighting it. If however she is able to get it change then I feel I should fit it. However I need to decided within the next 28 days which way to go.

Any advice is appreciated.

Thanks
 
It appears that it may all be due to timing.  That is CS is calculated (normally) according to tax returns and taxable income. So each year when a tax return is lodged the CS is recalculated.

So in May when you lodged the tax return CS was recalculated and the amount of CS increased dramatically, as the Tax return was lodged late, then it is backdated to the beginning of the Child Support period (i.e. when it was last amended which would likely have been when the other parent lodged their tax return). Effectively you are then in arrears (3 weeks to pay is the lengths they will go to collect, I don't believe there is any legislated period of 3 weeks to pay).

Now if this as in May then a lot depends upon when you lodge the 2016-2017 tax return, which it appears you haven't done.After receiving (I guess) another assessment due to the other parent lodging their tax return, the CSA use the latest available taxable income + some (adjusted taxable income indexation factor) and use that the the calculation, so you contact them and say that  the income doesn't truly reflect the income you will be getting and they listen and change. This becomes an income estimate, which will be reconciled at the end of the child support period and fines may be applied.

Now in theory any parent can lodge an estimate (they can be refused), so yes both you and the other parent can lodge income estimates. They would rarely if ever be to increase income.

However, reconciliation (correction), does take place.

I would suggest that you need to do two things.

1) Lodge your tax returns, if they are less than the previous year's, as early as you can (as late as you can if greater tha last year + the indexation factor). Your CS will then be reduced.

2) Ensure that you income estimates are accurate, if need be re-estimate them monthly. The CS Guide - 2.4.2 Formula Tables & Values

You may also wish to have a look at The CS Guide - 2.5.1 Income Estimates for a Year of Income

Additionally you may also want to have a look at The CS Guide - 2.4.4.40 Determination of Adjusted Taxable Income and  The CS Guide -2.4.4.60 New Information about Adjusted Taxable Income
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