Does the CMS know about my overtime?

Yes. HMRC reports your total gross income including overtime and bonuses, so the CMS will include these automatically.

I'm self-employed. How does the CMS calculate my income?

The CMS uses your net profit from self-employment as reported in your Self Assessment tax return.

What Counts as Income for Child Maintenance?

How the CMS assesses income

The Child Maintenance Service (CMS) uses your gross annual income from the most recent tax year as reported to HMRC. This is your income before income tax and National Insurance are taken off.

What income is included?

Employment income - wages, salary, bonuses, overtime, commission
Self-employment profits - the net profit from your business after expenses
Pension income - private and occupational pension payments
Rental income - profit from renting out property
Investment income - dividends and interest above certain thresholds

What income is NOT included?

Child Benefit
Universal Credit
Working Tax Credit or Child Tax Credit
Housing Benefit
Disability Living Allowance (DLA) or Personal Independence Payment (PIP)
Attendance Allowance
Student loans or grants
Maintenance payments you receive for the children

Is child maintenance taxable?

No. Child maintenance payments are not taxable income for the receiving parent. You do not need to declare them on a tax return, and they will not be counted as income for income tax purposes. Equally, the paying parent cannot claim them as a tax-deductible expense.

Is child maintenance classed as income for benefits?

For Universal Credit, child maintenance is completely disregarded - it does not reduce your UC entitlement at all. For most other means-tested benefits, child maintenance is also ignored. See our full guide: Does child maintenance affect benefits?

Company directors and the self-employed

If you are a company director, the CMS will use your salary plus dividends. If you take a low salary and high dividends to minimise your apparent income, the CMS can challenge this.

Caution: Deliberately restructuring your income to reduce child maintenance is risky. The CMS has powers to investigate and the receiving parent can apply for a variation based on "lifestyle inconsistency."

Do mortgage payments affect child maintenance calculations?

No. The CMS does not deduct rent, mortgage payments, or other living costs when calculating child maintenance. It is based purely on gross income. If you feel this leaves you unable to meet essential costs, see our living costs calculator which shows what payments might look like if living costs were factored in.