Stop focusing only on the negative

Jack and Jill have been separated for more than two years now.  However, Jill cannot stop talking negatively about Jack.  She cannot forget the names calling or the fact that he “lied” about his annual income to avoid paying child and spousal support.   When she feels tired, overworked, and stressed out by all conflicting demands on her time, Jill’s negative thoughts creep into her mind and play out like a movie. As a result, Jill is often depressed, she lacks energy and many of her girlfriends do not call her as much anymore.  Like many separated people, she has fallen prey to negative thinking… 

During and after a separation, people live periods of loss and grievance.  For many, separation is a failure.  Focusing only on the negative aspects of the relationship often helps a person justify to themselves and their entourage the reasons for the breakup. However, no one is served by holding onto negative thoughts indefinitely.  Getting counseling or divorce coaching is often necessary to move forward. 

 

Often those who think negatively do so out of habit.   It is a lot easier to dwell and complain about the 5% that is going “wrong” (i.e. the car that cut you off this morning) instead of focusing on the 95% that is going well (i.e. your health, job, children etc.). Studies have demonstrated that positive thinking can be extremely beneficial for improving self-confidence and psychological well-being, as well as boosting physical health.  Here are a few tips to help you maintain or develop a positive attitude:

1.      Meditate or do yoga - learn how to breathe and ease your mind;

2.      Smile – it will change your mood and relieve stress;

3.      Surround yourself with positive people –  a good friend can help you put things into perspective;

4.      Don’t play the victim even if your living situation is unbearable - there is always a way out; and

5.      Remember that no one is perfect – stop dwelling on the “what if”, learn from this life experience and move forward.

Love is sometimes blind… Marriage and immigration

Jack’s brother, Romeo, called him last night in a crisis.  His new wife Julia, whom he met in Cuba two years ago and whom he married the week after she arrived in Canada two months ago, stormed out of their home last night wanting a separation.  Romeo explained that their marriage was rocky from day one.  It would appear that, after the marriage, Julia became a completely different person than the sweet, kind and amusing woman he had dated long distance for the past two years.  Romeo believed that, with time, they would be able to work things out.  However, he has since found out that Julia never loved him and manipulated him into marriage solely to immigrate to Canada. Having sponsored Julia to become a Canadian resident, Romeo now faces years of financial responsibility towards her even after a divorce.

Romeo’s story is unfortunately similar to that of many other Canadians, and the options available in those situations (until recently) were non-existent.  At the moment, when someone sponsors a non-Canadian to become a Canadian resident, that person must give financial support to their immigrating spouse for three years, even if the marriage or relationship fails. If the immigrating spouse uses social assistance to meet his or her basic needs, the Canadian spouse will have to repay the money to the government, as sponsorship is a legal contract with the Government of Canada. You must meet its terms. It does not matter whether or not a judge would deny the immigrating spouse financial assistance pursuant to Canadian family law principles or whether the parties had signed a marriage contract confirming that no spousal support would be payable in case of separation or divorce.  If the immigrating spouse requires financial assistance to meet his or her needs, the Canadian spouse is 100% responsible, not Canadian taxpayers. Until very recently, there was nothing a “manipulated” spouse could do in this unfortunate situation.

However, in October 2012, the Canadian immigration laws have changed.  In an ongoing effort to deter people from using marriages of convenience to enter into Canada, the Canadian immigration authorities introduced a new regulation that requires certain sponsored spouses to live in a legitimate relationship with their sponsor for at least two years from the day on which they receive their permanent resident status in Canada.  If the sponsored spouse leaves prior to the two year requirement, its status may be revoked.  Canadian authorities can also lay criminal charges against the sponsored spouse.

Based on this new regulation, Romeo will not have to prove that Julia manipulated and married him for the sole purpose of immigrating to Canada, given that she left prior to the two year requirement.  Her status as a permanent resident will be revoked and Romeo’s obligation to financially support her will end since she will have to return to Cuba.  If you are a Canadian citizen or permanent resident and have met someone from another country on the Internet or while travelling, think carefully before marrying them and sponsoring them to come to Canada. Otherwise, blind love could completely turn your world around…

An offer to settle? Is my lawyer losing trust in my case?

The trial in Jill and Jack’s family matter is approaching.  They have not yet been able to settle their disputes over financial matters and the judge overseeing their court case has advised them that he was “setting this matter down to trial”. Family judges often do that to force the parties to be reasonable and be pro-active about settling their affairs. As a result, Jack’s lawyer has recommended that an offer to settle be made to Jill, emphasizing the fact that the offer is a significant compromise on Jack’s part. In other words, Jack’s lawyer is proposing to settle financial matters for an amount significantly less than what Jacks believes he is entitled to.  Jack wonders why he would do that and is beginning to think that his lawyer may not be advising him properly.

 

In fact, this is really good advice that Jack is getting. The role of offers to settle in a family court proceeding must not be understated, as they can have a significant impact on the dollars you might be able to recoup at the end of the day.  If accepted by your ex-spouse, an offer to settle will end your court case definitely.  This means, among other things:

• No more legal fees to pay (thousands and thousands of dollars of savings);
• You will not have to go to trial (no need to spend an entire week – or more – under stress, telling a perfect stranger about your most private affairs with your ex-spouse);
• No more stress over the legal proceedings (sleep at last); and
• The right for you and your children to live in peace, and finish grieving the end of your relationship. 

If your offer is not accepted by your ex-spouse, then making a « low ball » offer to settle will have the effect of protecting yourself against the high costs of divorce litigation. At the end of a full-blown trial, the judge will have the obligation to consider costs spent by each party in the court proceeding, and to award costs in favour of one party against the other.  This means that the judge will have the right to order one party (usually the party who “lost”) to pay to the other party (the “successful” party) an amount to compensate him or her for the legal fees paid throughout the proceeding.  The judge will look at the offer to settle that was presented before trial. If some of the terms of the offer were more beneficial to the other party then what was ultimately offered by the judge, the court is directed by law to make a cost order against the party who failed to accept this most beneficial offer for the time wasted going to trial. As a result, a “low ball” offer to settle can become very beneficial in the end. 

 

Everything in family court is about being reasonable.  While you may think that you have a 100% chance of success in the position that you are advancing in court, history has shown that, in every single case, at least one of the parties end up disappointed.  Making every possible effort to settle your family issues out of court could mean accepting a bit less than what you think you are entitled to. Most importantly, it could mean finding peace of mind. Often, settlement is a question of perception:  is your glass half-empty or half-full?

 

I need closure!

Jill wants to have the home transferred to her name.  She knows that it is over with Jack and she’s chomping at the bit to build a new life.  She feels that Jack is purposely dragging out the separation process in an attempt to wear her down and get a sweeter financial settlement.  Her biggest fear is to settle too quickly and end up living from pay check to pay check.  

Here are 3 common mistakes people make when negotiating a settlement:

1. Insist on keeping the home you worked hard for or that you like so much
Often, the matrimonial home can be more of a liability than an asset especially when you are living on a single income.  It is important to make a list of all the monthly expenses before making this big decision.  It is also recommended to add 25% to your current monthly budget because with time, you will need extra money to get the roof repaired, a new fridge and stove, a lawn mower, new furnace etc.   In the end, it may make more financial sense to sell the home and move into a smaller, more affordable property such as a condo, an apartment, or a smaller bungalow where the maintenance is taken care of or less costly.  Emotionally, it may also make sense to start fresh in a home more suited to your family’s current needs.

 

2. Get bogged down in the “I want” war
Too many separated spouses fight over possessions they want such as furniture, antiques, and knickknacks while losing the big picture in the process.  As a result, lots of time and money are wasted in petty battles.  Fighting over minor possessions just makes negotiations on the important issues, like the home, parenting issues and support (child and spousal), more difficult and lengthy.  It is important for you to become a savvy negotiator.  Make a list of the things that you absolutely want.  Also include in the list some of the items you are willing to let go.  Then “compromise” on the non-essentials and make it look like a win-win situation!

 

3. Be overly anxious to get closure or be afraid to be ridiculed by your ex
Too many people rush into settlement because they are seeking closure.  Others are afraid to be ridiculed by their ex and do not stand up their ground.  Sometimes the desire for closure or the refusal to speak up means the difference between a comfortable life and a marginal one.  Get involved, understand how the law works, ask questions and make sound decisions.  Remember that a piece of paper will not give you closure. Only time and working on yourself can do that. 

Should I go back to school as an adult student?

Jill is always struggling to make ends meet and she does not really like her job.  More than anything else, she hates to be financially dependent on Jack.  Since the separation, she is longing for a new exciting career with a higher income and better advancement opportunities.  Her greatest challenge is juggling home life, work and school.   Jill’s parents have agreed to help her out with the children during the school year.  However, they have a well-deserved retirement and Jill does not feel comfortable with imposing her family responsibilities on them.    Jill wonders if she should go back to school part-time or full-time, where she will take the money, the energy and the time to tackle this new life project. 

Here are four tips that can make an adult student life a bit easier:

1. Get Financial Help - Unless you have won the lottery or received an inheritance, money is the number one issue for adult student returning to school.  Ask your school for the various scholarships, grants and loans available in Ontario.   Often the applications must be sent several months prior to the beginning of the school year.  Make your budget, understand the debt repayment options available, as well as, the interest rates.  No sense accumulating a $50,000 debt that you will only pay off in 25 years!  Plan this out while you are at the negotiation table with you ex.  For example, you could try to negotiate a lump sum spousal support payment (one larger payment now rather than lower monthly instalments over a longer period of time).  You could also  ask for higher support payments but for a shorter period of time than the law would allow, which would give you the extra cash flow you need while attending school. 

 

2.  Plan study time in your busy schedule - Unless studying becomes your full-time job, you will have to juggle studies, children, and (maybe) a new relationship.  Managing your study time will be pivotal to your success.   Decide what hours/days you need. Making a date with yourself will help you stay focused and disciplined when something comes up during that scheduled time. Try to negotiate with your ex a parenting plan (access schedule) with the children that will give you the time you need to study.  You ex could be more than happy to help out with the children if, in the end it, your income is larger and you become less financially dependent on him or her.

 

3.  Reduce Test Anxiety – It is sad but true, with age and a surcharge of family responsibilities, our memory is not what it used to be when we were young and carefree students.  No matter how hard you study, tests are usually stressful.  Try to organize a special parenting arrangement with your ex during the weeks when you have exams.  School schedules are usually fixed a year in advance.  This gives you ample time to sort out, in  advance, a parenting arrangement for those weeks.  Being organized is the first way to reduce test stress, manage your anxiety and avoid last minute study cramming. When all fails, remember to breathe!

 

4. Create your support system -   Getting help from friends and family will be crucial during this very stressful and hectic time of your life.  Many schools offer group help and day-care facilities.  Friends and family may be more than happy to take the children for a meal and to special activities to help you out.  Don’t be shy and ask for help.  Get ideas from other adult students in your group. You might be surprised to see how many other single parents return to school and how resourceful they are when it comes to organization, household management and child care arrangements!

If I have to see you in court honey, you’ll have to pay my legal fees!

Jack and Jill have been trying to settle their separation issues by themselves for a couple of months now. Jill is getting frustrated with Jack because he does not seem to take their separation seriously.   She does not see any other options than to retain a lawyer and go to court.  She is convinced that once they go to court the judge will tell Jack what he needs to hear.  But when Jill finally met with her lawyer, she was a bit surprised by (and disappointed with) her lawyer’s comments and reluctance to engage into a court action.  She wonders if she hired the right lawyer…  In fact, Jill’s lawyer has explained to her that the court process is not only very time and emotionally consuming, it will also be very costly.  However, Jill is convinced that she will win hands down on all issues and that, in the end,  Jack will be responsible to pay for all her legal fees.

 

Many separated couples believe that going to court is the only way they can get someone to pay attention to what they are saying. They believe that they are right, the other spouse is wrong and that the court room will be the venue where the winner will take it all.   But legal fees to get there are a very important aspect to consider when making the decision to resort to the judicial system.  While a court may order the “losing” spouse to pay part of the other spouse’s legal costs to prepare and attend court, it is highly unlikely that the judge will order that ALL costs incurred be paid back to the “winning” party.   In addition, considering that most cases eventually settle out of court (less than 3% of all family court cases end in a trial, where costs orders are made), opportunities to get the big fat cost order are very rare.

 

In addition, it is not because a party wins in court the he/she will necessarily get his/her legal costs paid by the loosing party. In deciding whether a party should be responsible to pay for the other’s court costs, the judge will look at different factors such as: Were the parties reasonable?  Did the spouses make reasonable efforts to settle the case?  Did one of the parties fail to accept a reasonable offer? Did one spouse act in bad faith? Did one spouse pursue unrealistic claims? and the list goes on and on…

 

So no one should ever go to court thinking that they will win it all, or thinking that the other party will have to pay their legal fees.  When making the decision to go to court, you need to start from the premise that any and all legal fees paid to your lawyer will be on you, and that you will be lucky if at the end of the day a judge orders your ex to pay some of them.  This is why it is so important to make sure that you have tried every possible way to settle out of court before you chose this very lengthy and costly avenue.

Why should I stress with work and let you relax at the spa!

Jack’s work environment has changed considerably lately and he feels lots of pressure to work excessive hours with short timelines.  He is currently experiencing health issues and his doctor has asked him to explore the possibility of taking an early retirement.  His employer has made it clear that hiring temporary help is out of the question.  Jack is seriously considering his doctor’s suggestion but wonders if, by taking an early retirement, his monthly support payments to Jill would be reduced or terminated.  After all, why should he stress with work while Jill spends his money relaxing at the spa!

 

If Jack is retiring for the sole purpose of reducing his support obligations, a court may impute him a higher salary than his retirement income, and calculate his support obligations based on what he used to earn before he retired.  This same principle applies to a payor who intentionally reduces his/her income to avoid paying support.   However, if Jack’s decision to retire is deemed reasonable (because it was prompted by medical reasons or some other « reasonable » cause), then his support payments may be reduced or even terminated.  In that case, the courts would look at many factors, including the following two important principles:

1. The nature of spousal support - Spousal support is an important and necessary means to share the financial impacts of separation which sometimes go well beyond the payor’s retirement.  In deciding whether or not the support obligation should be modified once the payor retires, the court will consider the nature of the support received by the recipient: (i) was the support ordered to compensate a spouse who stayed home throughout the marriage and who, as a result, did not have the opportunity to advance his/her career and earn a reasonable income? or (ii) was the support meant to alleviate a financial need, where a spouse  is unable to meet his/her personal monthly needs?  When support is based on compensation, the courts have often concluded that a spouse is considered to have been fully compensated by the time the payor retires.  However, when the support is based on needs, the courts have at times extended the obligation to pay beyond retirement. 

2. The “double dipping” principle -  The court will consider whether or not the payor’s pension was divided at separation through an “equalization payment” (the payment made between married spouses after a separation ensuring that each spouse ends up with assets of equal value for the period of the marriage).  If the pension was already divided as part of the property settlement agreed to by the spouses at separation, the court will try to avoid « double dipping ».   In other words, the court will avoid dipping again in the same source of funds (i.e. the pension) when granting support, unless the recipient has a significant need that cannot be addressed otherwise. 

 

Spousal support is a very complex area in family law and the payor’s retirement can add to the  complexity.  If retirement is a factor to be considered in your situation,  you  must consult a lawyer to ascertain your options and the impact your retirement may have on your financial situation.   Prior to meeting with your family law professional, take the time to understand the basic concepts of spousal support to use your time with your lawyer more efficiently (Knowledge is power and time is money!).  Visit our website at www.familylawinabox.com and listen to our program on Spousal Support (click here).

Remarriage and Spousal Support

Jill has met a new man.  He has never been married and asked her the other day if she would ever consider marriage again.  Jill always thought that once was enough but this man, Gary, is very kind, attentive to her needs and he is very respectful of the children.  He dreams of building a family life with Jill and believes that marriage would be the ultimate commitment. Jill is really not sure about this ‘marriage commitment thing’. She is also afraid that it may affect the monthly spousal support she is getting from Jack and that she has fought so hard to obtain… And then what happens if it does not work out with Gary?

If Jill remarries, she will be faced with three possible scenarios.  Her spousal support may be (1) terminated (2) reduced or (3) continue as is.  The main issue that will be considered by a court will be whether Jill’s remarriage is considered a “material change in circumstances”.  In order to change the spousal support terms of an agreement that you signed, you must show that something important changed in the parties’ circumstances and that if such changed circumstances had been present when the agreement was negotiated, it would have led to a different amount being paid.  So, if Jill’s remarriage was a clear possibility when she signed her agreement with Jack, and the agreement does not state that her remarriage would be “a material change in circumstances”, it is likely that Jill’s remarriage would have no impact on Jack’s future support obligations.

If Jill’s remarriage was not likely to occur in a foreseeable future when the parties signed their separation agreement, it is possible that her remarriage will be considered a “material change in circumstances” allowing Jack to ask that his support obligations be reviewed in light of Jill’s new family circumstances (and increase family income). This would not of course guarantee an automatic change, as Jill’s entitlement to support (particularly if it was being paid to her to compensate her for the economic disadvantages suffered during her marriage to Jack) might not change even if she is remarried.

Sometimes, a separation agreement specifically provides that spousal support will end if the recipient remarries.  In that case, the outcome would be quite clear and the spousal support would end the day Jill says “I do” for a second time. 

Spousal support is complex.  When dealing with this issue, courts (and lawyers and mediators) will have the following four objectives in mind: 

 

1) recognize any economic advantages or disadvantages to the spouses arising from the marriage or its breakdown; 

 

2) apportion between the spouses any financial consequences arising from the care of any child of the marriage over and above any obligation for the support of any child of the marriage;

3) relieve any economic hardship of the spouses arising from the breakdown of the marriage; and

4) in so far as practicable, promote the economic self-sufficiency of each spouse within a reasonable period of time.

 

If you are contemplating remarriage, spousal support is only one of the issues that you should  consider carefully with your legal advisor. Understanding how to protect your property in a second marriage (by entering into a marriage contract) is also key to happy endings. Visit our website at www.familylawinabox.com and listen to our program on Division of Family Property for Married Spouses (click here).

Just ask the Taxman and you shall receive money!

Tax filing season is here again. Jack knows that tax deductions and exemptions reduce the amount of income on which he has to pay tax, in contrast to a tax credit which means a dollar-for-dollar reduction in the actual amount of the tax that he has to pay.  Although Jack pays child support for the two children, he cannot deduct the amount from his income.   However, the monthly spousal support he pays Jill is a deductible amount.   Jack knows that he will owe the Taxman money again this year and as a good Canadian citizen he will pay his dues.  However, he is also looking at ways to keep money in his pockets as he would love to buy a pontoon boat which would make his summer vacation with the children so much fun. 

Here is a list of some child tax benefits and credits that might be available to you from the federal and Ontario governments:

1. Child Tax Credits - This federal credit can save you up to $329 for each child under the age of 18.

 

2. Canada Child Tax Benefits - The federal CCTB is calculated for July to June yearly and could bring in to a low-income family with two children up to $555 in additional savings.   If Jill and Jack shared custody of the children (50-50 or 70-30), the CCTB would be divided equally but since both kids reside with Jill (70-30), she is the only parent eligible to claim the CCTB.  In Ontario, depending on your income, you may also be eligible to claim the Child Care Benefit and the Child Care Supplement. 

 

3. GST Credit:  This federal tax-free quarterly payment helps individuals and families with modest income offset all or part of the GST that they pay.  To receive the GST credit you have to apply for it every year.

 

4. Child Fitness and Art Tax Credit – At the federal level, for each child under 16, parents may claim a tax credit of up to $500 registered in a sport like ballet, hockey and soccer and another $500 for artistic and cultural activities, like art or music lessons.  In addition, the Ontario government offers the Children’s Activity Tax Credit where you can claim up to $526 in eligible expenses and get up to $52.60 back for each child under 16.  You can receive up to $105.20 back for a child with a disability who is under 18.

 

5. Universal Child Care Benefit – The federal UCCB provides families with $100 per month for each child under the age of 6 or $1,200 per child, per year.

 

6. Eligible Dependant – If you were a single parent during 2012, you may be able to claim an eligible federal dependent tax credit for one of your children which is equivalent to claiming a dependent spouse.  However, whether or not you receive spousal support you are entitled to this credit.  In the case of Jack, since both kids reside with Jill, he may not claim them.

 

7. Child Care Education – Child care expense can be claimed to the federal government when you hire a babysitter or put your child in a daycare or summer camp to enable you to go to work (or attend school).  If you enrolled your child in a fitness program or summer camp, which operates during the hours you are working, then you must first claim the cost as a childcare expense.

 

8. Medical Expenses – Save your receipts whenever you buy glasses for your children or take them to the dentist as you may claim them at the federal level.  If you have a group health insurance plan at work, then only the portion that is not reimbursed is available for you to claim.

 

9. Child Disability Benefit - The federal and provincial governments provide child disability benefits.  If you believe your child is eligible for this benefit, ask your doctor or occupational therapist to complete a Disability Tax Credit form.

 

10. Tuition Tax Credit  - The federal government offers textbook amount and scholarship and bursary exemptions.  Also, if your child attends a university or a private school, you may claim the applicable tax credits from the Ontario government. 

 

Find out more information about Tax Benefits and Credits by visiting the section in our ToolBox (click here). 

Ask your lawyer for tax receipt and save money!

It is now tax season and Jill has made an appointment with her accountant to finalize her yearly income tax return.  Since Jill needed every penny she received in spousal support to make ends meet, she did not listen to her lawyer’s recommendation to set aside in her savings account 25% of the total income paid by Jack.    She is now extremely stressed and wonders how much money she will need to return to the taxman.  After speaking with her friend Susan, who has gone through a divorce a few years ago, Jill may have found a silver lining that may help her reduce the amount of income tax she owes.  As explained by Susan, all Jill needs to do is ask her lawyer for a tax receipt indicating the total amount of the legal costs she incurred to either:

• establish the amount of support payments (child and/or spousal);

• collect late support payments;

• increase support payments (child and/or spousal);  and/or

 

• defend against a request by the payer (Jack) to reduce established support payments. 

If you are a recipient of child and/or spousal support, you can deduct, in your income tax return, the legal fees incurred to obtain, collect or increase support as well as defend a claim for the reduction of such support.  The legal costs incurred by a recipient to resolve any other issues such as property and parenting cannot be deducted.  Unfortunately, if you are the payer of child and/or spousal support, you cannot claim legal costs incurred to establish, negotiate, or contest the amount of support payments.

 

Your lawyer, if asked, will be responsible to prepare the tax receipt and determine the amount of legal costs you spent in the year to deal with the support issues mentioned above. So if you believe that some of the legal fees you incurred this year qualify as a tax deduction, don’t forget to ask your lawyer for a receipt!

Spousal support? Are you kidding me??

Jack and Jill both met in university.  During their last two years of university, Jack and Jill moved in together and married a few months after graduation.  The couple were advancing in age and as Jack was making a decent salary that could support the family.  They then decided that Jill would stay home with the children until they were in school. But Jill never truly started her career.  She is working part-time for the local television station, which gives her time to attend to all of the children’s medical and extracurricular needs. Her annual income is not sufficient to be self-supporting. Jill is completely discouraged especially in this time of recession where no one is hiring and all of her friends are being laid-off.   Jill has been told by her lawyer that after 13 years of marriage she would most likely be entitled to spousal support.  Jack disagrees stating that it was Jill’s decision to stay home while he worked his butt off all these years to support the family. 

 
Unlike child support which is calculated according to a specific amount set out in the Federal Child Support Guidelines, spousal support is not set in stone.  If the parties disagree on the amount to be paid, or for how long, the court will be required to make a decision and they have much discretion in setting those parameters.  The following factors, among others, will be considered: 

- The number of years during which the parties have lived together;
- The parties’ respective income;
- Whether the couple still have dependent children;
- The parties' age as well as their physical and mental health;
- The parties’ standard of living during the relationship;
- The parties’ current assets and financial means, including what they are likely to earn in the future;
- The capacity of the recipient to contribute to his/her own support, by working or otherwise, and the amount of time it will take him/her to achieve self-sufficiency;
- The payer’s capacity to pay support; and
- Whether or not the recipient has helped the other spouse to build a career or a business.

 

In general, the duration of spousal support can vary from 0.5 to 1 year of support for each year the couple has cohabited together (note that it is the years of cohabitation that count, not the years of marriage).  In certain circumstances, such as when a couple has cohabited for more than 20 years, the support may be payable for an “indefinite” duration.  This means that the support will continue to be paid until an important change occurs (such as remarriage, retirement, important change in income, etc.).

The right to ask for spousal support is automatic for married couples. With regard to common law spouses, it varies from province to province.  In Ontario, you can only ask for spousal support if you have lived together for 3 years continuously, or if you have a child together and live in a relationship of some permanence. The same factors (as listed above) are relevant for married and common law couples.

For more helpful information about spousal support or the rights of common law spouses, subscribe to our full library of recorded programs (Study Box) available 24/7 at www.familylawinabox.com (click here to be directed to our Study Box).

 

Child Support – Why should I support my wife’s shopping addiction?

Following many discussions, Jack and Jill have finally agreed for Jill to have the children in her primary care (equal to 70% of the time) and Jack, because of his work obligations and difficult schedule, will have them in his care every second weekend including one or two evenings in between (or 30% of the time).  As a result of this arrangement and because he earns a substantially higher income than Jill, Jack’s monthly child support payment will increase.  Jack is concerned about Jill’s love for shopping. While he financially supported it during the marriage, Jack is convinced that a good chunk of the child support he will pay will not be spent on the children. Jack spoke to colleagues at work who used all sorts of strategies to reduce their child support payments. He wonders whether he should have insisted to have the children 50% of the time and whether it was a good idea to accept the long-awaited promotion handed out to him at work, resulting in a higher income… and higher child support payments.

Both of these options are not advisable.  Firstly, a parent should never make parenting decisions based on financial considerations (i.e. with a view of reducing child support).  The court would readily see such a decision for what it is and the parent would lose credibility before the court (or a mediator).  Decision-making authorities assess parenting arrangements based on what is in the best interest of the children, and nothing else.  Rights and obligations regarding children are the same whether you are married or living in a common law relationship.

In the same way, it is a terrible idea for a parent to take steps to quit a well-paying job or to voluntarily reduce his/her annual income to avoid paying child support.  If a court finds that the payer parent has voluntarily reduced his/her income, it may impute an annual income that is greater than the one shown on the income tax return.  The amount of the imputed income will be based on what the court believes the payer parent has the capability to earn.  Following the court decision, that parent will be obligated to pay the higher basic child support amount imputed.  

Many payer parents are concerned with the way basic child support is being used by the recipient parent. While this may be frustrating in some circumstances, the payer parent has no control over the money once it has been paid to the recipient parent. What payers need to understand is that basic child support is not meant to cover strictly expenses that directly benefit the children themselves (such as food and clothing).  It also serves to cover expenses which benefit the children indirectly (although it also has the effect of benefitting the parent as well), such as the mortgage and utilities (for the home in which the children live), the car (which is used to travel them around) and, yes, even the brand new porch…

The payer parent should also keep in mind that in the Federal Child Support Guidelines, basic child support amounts vary for each Canadian provinces and territories and are set based on the amount that an individual parent, with a specific income, is expected to spend to provide for his/her children.   It is simple, the higher the income, the higher the child support amount will be.  Although a payer parent may feel that it would be « cheaper » not to pay child support and to have the children half the time instead, let’s remember that raising children is extremely expensive (many little things, which you may not think about, result in considerable costs when pulled together; haircuts, school lunches and activities, birthday parties, toys, personal care items and, yes, those LuLu Lemon pants…).  In the vast majority of cases, the basic child support amount will not be sufficient to cover that parent’s share of the children’s expenses (both direct and indirect) and the recipient parent will often have to modify his/her current standard of living to support the children financially.

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