Which living expenses does the court take into account when calculating child support?
Earlier this year the Supreme Court, the highest court in the Netherlands, gave its opinion on the flat-rate living expenses in child support. In this blog I will explain what the fixed housing costs are and in which cases, according to the Supreme Court, the actual living costs can be taken into account when determining child support.
Flat-rate living expenses
Since 2013, the Expert Group on Alimony advises to take 30% of the net disposable income into account when calculating the financial capability of the obligated party to pay child support. As a result of this system, a parent who earns more or less is ‘allowed’ to spend more or less on his/her living expenses when it comes to child maintenance.
The Expert Group Alimony gives recommendations, also called alimony norms. These are guidelines and therefore do not constitute a right within the meaning of section 79 (1) of the Judiciary (Organisation) Act. The purpose of the Alimony Expert Group is to contribute to the predictability and legal certainty of the administration of justice in alimony cases.
Specifically with regard to living expenses, it prevents any change in the living situation of a parent from giving rise to a request for a change in child support.
Actual living expenses
After the introduction of the flat-rate system, it is regularly requested in child support cases that the actual living expenses be taken into account instead of the flat-rate living expenses. Requests for this are made by both the entitled party and the obligated party.
Lower case law shows that there can be various circumstances that give reason to take the actual living expenses into account instead of the fixed amount of living expenses.
Previous decisions from different District Courts
In an order of 18 July 2014 (ECLI:NL:RBOVE:2014:4755), the District Court of Overijssel took into account the actual living expenses of the maintenance debtor, because in addition to his own living expenses, he also paid the expenses of the former marital home (where he was not living).
In its order of 29 June 2016 (ECLI:NL:GHDHA:2016:2310), , the Court of Appeal of The Hague ruled that the actual living expenses had to be taken into account, in view of the large difference between the actual living expenses and the fixed amount of living expenses and the fact that if the fixed amount of living expenses were to be taken into account, this would be at the expense of the children.
In its decision of 4 April 2018 (ECLI:NL:RBNHO:2751), the North Holland District Court took the actual living expenses on the side of the maintenance creditor into account, because these living expenses of the woman had a permanent character and were therefore in line with the recommendations of the Expert Group on Alimony.
The Supreme Court 16 April 2021 (ECLI:NL:HR:2021:586)
In the Supreme Court judgment of April 2021, it was disputed whether the Court of Appeal of Arnhem-Leeuwarden had correctly taken into account the fixed housing costs of the obligated party. In this case, the actual living expenses of the obligated alimony payer did not exceed € 95,- per month, while the fixed housing expenses amounted to € 678,30 per month.
In its decision of 16 April 2021, the Supreme Court concluded that the use of a fixed housing expense is not in itself contrary to the legal standards (need and capacity). The Supreme Court considered that the flat-rate calculation system serves predictability and legal certainty and prevents every change in the living situation from having to be submitted to the court.
However, according to the Supreme Court, this does not mean that the fixed housing costs must always be taken into account. There are conceivable situations in which the actual living expenses must be taken into account.
According to the Supreme Court, this is the case if the child’s needs (the amount needed according to the Alimony Standards to pay the child’s monthly expenses) cannot be fully met and the actual living expenses of the parent in question are permanently significantly lower than the fixed housing expenses. The judge will then have to examine whether application of the actual living expenses would lead to a higher child maintenance payment. Is this the case? Then the judge will have to impose the higher maintenance, or motivate why he/she sees no reason to do so.
The Court of Appeal of ’s-Hertogenbosch (ECLI:NL:GHSHE:2021:2305) considered in a recent judgment, with reference to the Supreme Court ruling, that with the available financial capacity of the parties the childrens needs could not be fully covered. In view of the man’s low monthly mortgage costs, which he could also share with his partner, the court ruled that the actual living expenses were permanently lower than the flat-rate and that the actual living expenses had to be taken into account.
Conclusion
In child maintenance cases the starting point is the flat-rate living expenses. Judges can take the actual living expenses into account if the child’s needs cannot be fully met and if there are permanently considerably lower living expenses.