Understanding Child Support – The Basics
Parents are familiar with the different categories of costs their children incur at an early age, as a teenager, and as an adult child entering a post-secondary educational program. When the family is intact, the expenses are often paid from a joint account. When a couple separates, who pays the child support, how much, and for how can become quite a contentious issue. Child support is owing from the time the spouses are physically living separate and apart. This blog will provide a quick overview of some of the components of child support in Ontario.
What is the Child Support Guidelines?
The Child Support Guidelines (CSG)are regulations enacted with the Ontario family law legislation and with the federal or national Canadian Divorce Act. The language of the provincial Child Support Guidelines is very similar to its federal counterpart. The provincial legislation applies to common law or unmarried parents and the Divorce Act CSGs are applicable to married spouses (separated) or former spouses (divorced). The question of a child’s entitlement to receive child support is moot for an infant or young child. It may be arguable whether an adult child is entitled to support.
What distinguishes the monthly payments and special expenses?
The fixed table amount of child support assists with the cost of a child’s accommodation, food and clothing expenses. It gets its name from the table comprised of a vertical axis listing income ranges and the horizontal axis showing the monthly amount of child support. The intersection of the two axes is the monthly amount of child support to be paid by a payor earning the indicated amount of income after all regulatory considerations are made. The Table amounts vary for the number of children in the household entitled to child support. The Table amount of child support is paid each month in the same amount by the parent with whom the children do not primarily reside. When the payor files an annual income tax return, the line showing his or her income from all sources, line 150, becomes the base reference value for the calculation of child support.
The fluctuating special and extraordinary child expenses relate to specific categories of children’s expenses and are shared proportionate to each parent’s income. These include child care expenses, tutoring and remedial educational costs, and expenses for post-secondary expenses.
How do I figure out the amounts and who pays for what?
The federal government of Canada provides at its website the full text of the Child Support Guidelines including the Tables to calculate the fixed monthly amount of child support.
Know that the proper calculation may involve more than a quick reference to the simplified Tables. The schedules to the Child Support Guidelines must be considered in every calculation of child support. Schedule 1 is the listing of the monthly fixed Table amounts payable by the non-custodial parent to the parent with primary residential responsibilities. Schedule II is the Household Standards of Living Test. It is used when there is a significant difference in the quality of living between the residences where the child lives. Schedule III permits certain employment deductions allowed in the Income Tax Act to also apply in the calculation of child support Table amounts. To avoid consideration any or all of these Schedules may lead to a grossly incorrect calculation.
Not only is the whole of the Child Support Guidelines to be studied for each child support calculation, the handling of different child-related expenses and the interpretation of the Child Support Guidelines by the courts are also important steps to be undertaken. Given the there is a federal child support guideline, every court across Canada responsible for the granting of a divorce will also have child support matters argued before them. How have the courts dealt with discretion to award a fixed monthly amount of child support different from the Table amount that otherwise would be awarded under the Child Support Guidelines?
Is child support taxed like employment income?
Child support is not taxed in the hands of the recipient nor is it a taxable deduction in the hands of the payor. There are adjustments made when the recipient spouse receives child-related tax credits allowed by the Ontario or federal government such as fitness or arts tax credit. For more information about children’s expenses allowing one or both parents to claim tax credits see http://www.cra-arc.gc.ca/individuals/
If a child support dispute arises, where do I go?
Provisions in the separation agreement: If traditional negotiation or collaborative family law negotiations resulted in the drafting of a separation agreement, likely there are provisions for resolving disputes about child support. You will need to review these and follow the steps provided first before looking to litigate the matter.
If you are recently separated and have not negotiated a separation agreement: There are a few options available to you. If the relationship remains amicable, now is a good time to consider negotiating at least a partial separation agreement to deal with all of the children’s issues at one time. The terms of a family law separation agreement may be negotiated using the interest-based Mediation or Collaborative family law negotiation principles.
If the relationship has deteriorated since separation, or if there are issues of domestic violence, using the public court system of family law litigation or the private family arbitration process may be more appropriate.
For more information on the complicated legal issue of child support or to better understand the different ways in which to resolve child support disputes, please contact my office.