A. I presume you and the children’s father have had an informal child support arrangement until last July. It is common post-separation for parents to base their child support payments on the Inland Revenue online child support calculator.
Now that the children’s father has hidden his income in the trust, you must go through Inland Revenue.
Make it your business to know
Start your day with the latest business headlines straight to your inbox.As a first step, you need to apply for a formula assessment. This is an assessment of what child support is to be paid. It is calculated using your respective taxable incomes and how many nights you each care for the children. It is easy to apply for this on the Inland Revenue website. You need to do this right away as the formula assessment of child support only starts from the date you apply.
The formula assessment may say that only a small amount of child support is payable if it uses the minimal income of the children’s father and your income. If so, you then need to apply for a Child Support Administrative Review. This is a request for the Commissioner of Inland Revenue to review the outcome of the formula assessment.
There are 11 review grounds. The relevant ground is the ground that says the assessment does not consider the real income, earning capacity, property and financial resources of the parents. Read more >
Q: I have been in a relationship for four years. My partner wants to change careers and will need to return to university for further study. She will take out a student loan to meet the cost of her university fees. If we separate would this loan be classified as her debt, or a joint debt? Also, my son from a previous relationship wants me to buy him a Tesla. He is in a serious relationship, and I think he wants to buy it in his and his partner’s name. Do you have any advice about this?
A. If your partner’s student loan is considered a relationship debt under the legislation, you will be required to meet half the amount owing if you separate.
Put simply, a relationship debt is a debt that has been taken out to benefit the household/relationship. This is assessed on a case-by-case basis and can include things like incurring debt to acquire relationship property, run the household or raise children. With a student loan, a court would consider whether the qualification was obtained for the benefit of the household/relationship or for the benefit of an individual.
Waka Kotahi the New Zealand Transport Agency will not allow the Tesla to be recorded as joint property of your son and his partner; vehicles can be registered in one person’s name only. However, this would not prevent your son’s partner from making a relationship property claim to the vehicle if they separated.
Although gifted assets are separate property under the legislation, they can be converted to relationship property. If your son and his partner both use the Tesla, it would likely be regarded as a family chattel and therefore relationship property once they have been in a de facto relationship for three years. Read more >
Q. My partner has recently decided to end our relationship and we are in the process of dividing our assets. Shortly after our separation, I realised that he has been spending tens of thousands a year on designer clothing and shoes. I was always under the impression that money was tight so I picked up extra hours at work when I could and I cooked all our food from scratch. Our total asset pool sits at about $1 million. It does not seem fair that he now gets an equal share of all our assets.
A. In New Zealand, relationship property is generally divided equally and the Family Court will not revisit how a couple managed their finances during their relationship, nor pay any attention to misbehaviour generally (such as one party having an affair).
However, in some exceptional circumstances, the Court will consider misconduct by one party when it comes to whether the property is divided unequally, in one party’s favour. The threshold is high – the misconduct must have been:
1. “Gross and palpable;” and
2. It must have significantly affected the extent or value of the relationship property pool.
Neither the words gross nor palpable are defined in the legislation, but they suggest that the misconduct must have been significant for the Court to depart from the legislation’s general policy of equal sharing. Read more >
Q: My partner has been offered a job in Nelson with a competitive salary. I would like to relocate with him and my two sons (age 4 and 6) from my previous marriage. We live in Auckland. I believe the move would afford us a more relaxed lifestyle, and the opportunity to finally get into the housing market. Although my ex-husband and I are still on good terms, I am unsure how he would react to the proposal. Also, given that my partner is now very close to my sons and effectively acts as the third parent, I believe he should have a say in the matter. Could he be appointed an additional guardian?
A. Whether or not your sons should move to Nelson is a guardianship issue. Guardianship is essentially decision-making for your children: Where they live, what medical treatment they receive, what school they attend, and so on.
Where possible (unless an emergency arises and the other guardian is uncontactable), guardians must act jointly and consult each other when making guardianship decisions. Therefore, you must secure your ex-husband’s agreement prior to the move. If he agrees, you should have him confirm this in writing.
If your husband does not agree to the relocation, you will need to seek the Family Court’s permission to relocate the children. Relocation cases are difficult as there is often no “midway” settlement option. Either the children get to move or not.
A new partner or spouse can be appointed an additional guardian of the children under the legislation by a registrar without a court hearing, where the parents both consent. Certain additional conditions need to be met, such as that the new partner must have shared the day-to-day care of the child for at least a year.
If the other parent does not agree, an application would need to be made to the Family Court for the non-parent to be appointed a court-appointed guardian. My view is that it would be difficult to convince a judge to appoint a new partner as a guardian where the other parent remains involved in the child’s life. Read more >
Q. Last month my husband withdrew $15,000 from our kids’ Sharesies account to buy himself a new e-bike. He did this without discussing it with me first and I’m really upset about it. He said he’d replace the money, but it hasn’t happened yet. Is there anything I can do to stop this from happening again without my consent?
A. Yes, you can stop this happening again. Your husband is in breach of trust by removing the funds from your children’s Sharesies account for his own benefit.
Under Sharesies’ terms and conditions, a Kids Account operates as a “bare trust”. What this means is that your children are the beneficial owners of the investments and/or funds in the account and any income generated.
Once the children reach transfer age, they can request to control the account. The default transfer age is 25, but you can adjust this to any age between 18 and 25.
When you and your husband deposit money into the Kids Account, you gift it and thereby lose your interest in those funds.
Kids’ accounts are normally relationship property. It is important to ask your partner if they have any shares in the names of your children.
The account holder, presumably in your case your husband, is the trustee. The trustee has no beneficial interest in the account and their job is to administer the account for the children’s sole benefit. Trustees are liable for the consequences of their own breach of trust. So your husband is obligated to repay the funds he has withdrawn for his own benefit.
If you have the email addresses and passwords, you can check the balance in the account. You may also be able to approach Sharesies and explain what happened and why you need access to the account. Read more >
Jeremy Sutton is a barrister and family lawyer at Bastion Chambers.
