[Solved] Calculations and pensions

hi,

they have a complaints procedure, you can look into that:

https://www.gov.uk/manage-child-maintenance-case/complaints-and-appeals

yes it is annoying to deal with them. none of them can even explain my arrears to me, other than tell me its correct and the way their systems work it out is complicated. :p

Hello again Bill,

Thanks for the link.
Every time I have talked to someone there, they have agreed that I am right in what I say. I even sent a whole sheaf of documents last year. When the very nice guy I was dealing with (Jordan) finally replied, he said that my letter and documents were a great help to him! Whilst that was flattering, and achieved the desired result, I still think it odd that it was my documents that produced the desired result, rather than the CMS figuring it out themselves!
I shall try that link tomorrow. My head is full today!
Regards,
M.

I agree, go for the complaints procedure as soon as possible - also do a subject access request on them to get everything they have about your case (expect a lot of paper and repetition, though I think you can ask for it in electronic format) as this might help you back up your complaint.

Hi Martin,
I had the same issue last year and fully expect it again at my next review! It may be because you and I are in a 'relief at source' pension scheme. My advice: get a 'contribution receipt' for the year in question from your pension provider BEFORE your annual review is due. Then if it is wrong again, go straight in with the complaint and provide your 'contribution receipt' as evidence.

Good luck

Best of luck
:p

This is what happened with me: basically, I've been paying CMS since 2014, always been in my workplace pension. I have increased my pension over the years up to 5% in line with government guidelines in order to get the maximum contribution from my employer. I always assumed that the CMS automatically accounted for my pension. (Spoilers: they didn't)

Last year when I had my annual review, I noticed that the figure that they had used to calculate my payments was my top line, (£40k) BEFORE pension deduction. I rang them and the lady assured me that pension had been taken off but repeated that they used £40k. She insisted that this was my earnings AFTER pension was deducted. I assured her that it most certainly was not but she wouldn't have a bar of it.

After many phonecalls to CMS, DWP, my pension provider and my employers wages department (all of which where blaming one another), I kind of figured out the problem. I learned that my pension was what is known as a 'relief at source' scheme. This means that it is taken from my salary and put into my pension pot AFTER tax is applied (therefore, I have paid tax on my pension contribution). Once it is in my pot, my pension provider claims the tax back from the inland revenue a d this also goes into my pot.

This 'relief at source' type of scheme seems to cause problems as I don't think that the CMS automatic calculation is set up for this type of scheme. They take your earnings as everything that you are taxed on, and as you are taxed on pension contribution initially (although it is claimed back later by pension provider!), your pension is not deducted before they calculate your payment.

I called them back to explain all of this but they would not have it. So I had my pension company send me a full breakdown of all my pension payments (including tax relief) for the last 5 years. I sent those in to the VMS in the form of a complaint. They replied and said that I only began paying into my pension a few months ago and therefore those contributions will be accounted for in next years review! I have no words. They clearly did not read my letter nor look at the 5 years of pension statements I had provided. So I took it further and started a court application. Before we where due in court, they sent me a letter briefly saying that they had adjusted my payments and did not need to go to court. No apology or any other explanation.

I had to check the online portal to learn that my payments had been reduced, so eventually it was a good outcome.

I fully expect the same issue this year as when I rang the CMS for an explanation, she said that she couldn't understand why they had reduced it and still insisted that it had been correct in the first place. These people are unbelievable!

So the moral of the story is:

-Check the figure that they have used to calculate your payments, it should be less than your gross; add up all your total earnings BEFORE any deductions for the whole year. If that is the same figure that they used, you are paying too much maintenance.

-Contact your pension provider to find out if you are in a 'relief at source' scheme (there was no info about this on my annual statement, I had to find this out for myself).

I hope this helps because I had a nightmare with it 😮

Hi Cooldad

Thanks for your post and explanation.

Can i ask, when they finally made the recalculation and reduced payments, did you get any over payments back or did they reduce your payments even further to account for any overpayment made whilst they were in dispute?

Thanks

also, excuse my ignorance but what sort of court application did you start that resulted in them recalculating?

Thanks

Hi Daddyup,
When they recalculated they did reduce it further to account for the overpayments that I had already made, so I won't be out of pocket in that respect.

It is my impression that the people that you speak to when you ring up are just the drones: they are incapable of independent thought and often do not understand the system themselves (think "Computer says no" woman from Little Britain!).This is demonstrated if you ring up several times with the same query but get different explanations from each drone. To get anything done you need to take it further.

I used the SSCS2 form from the government website to initiate the court application. You can find it here:

https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/772386/sscs2-eng.pdf

Thanks cooldad very helpful...