The value of investments and any income from them can fall and you may get back less than you invested.

GREEN v ADAMS [2017]

An application was made in the family court in respect of the parties’ child. Mother wanted a capital sum from father to replace her car, to cover the costs of trips for their son and to buy a new lap top for him. The total sun she was seeking was £20,600.

The child’s father was 65 years old and was a rich man who had already settled over £220,000 to purchase a home for his son to live in with his mother. However, the father had paid little by way of child support as he was assessed to pay £7 per week despite having access to millions.

Father had access to a pension fund valued at £1.35 million after drawing his tax free lump sum. He had asked his pension consultant to invest the fund in such a way to avoid drawing any income from the fund. Any income he drew would subject him to a child maintenance assessment which he clearly did not wish to pay. Father was evasive about his investment strategy for the pension and the Judge found that he would be able to alter the investments to draw the income if he chose to do so.

The Judge found that the father’s approach to the support of his son to be “little short of scandalous”.

The Judge awarded the mother the full sum she wanted and awarded her 8% interest on the sum if father failed to pay it. The judge also took the unusual step of securing the capital sum against father’s property as there was a suggestion that father wouldn’t pay the sum.

Please note that this document was prepared by a third party and as such Brewin Dolphin is not responsible for the content or able to answer queries on the topics dealt with. While we believe it to be correct at the time of writing, Brewin Dolphin is not a tax adviser and tax law is subject to frequent change. Therefore you should not rely on this information without seeking professional advice from a qualified tax adviser, who should also be able to assist you with any questions on the content.

This document was prepared as a general guide only and does not constitute tax or legal advice.

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