Child Support in Ontario - New Guidelines in Force Starting January 1, 2012 !
Child Support Guidelines
A child support order is a document from a court stating when, how often, and how much the payor is to pay for child support.
Historically, child support in Ontario and the rest of Canada was determined according to the child's needs and the parent's ability to pay. In 1997 the Child Support Guidelines were introduced across the country. At that point, child support payments were no longer tax deductible and the recipient did not need to declare receipt of child support in his/her income.
The Guidelines are based upon the income of the support payor and the number of children who are entitled to support.
The objectives of the Guidelines are as follows:
- to establish a fair standard of support that reflects the financial means of the parents after separation;
- to reduce conflict by making the calculation of child support more objective;
- to improve the efficiency of the legal process and encourage settlements;
- to ensure consistent treatment of spouses and children in similar circumstances.
The Guidelines were not adjusted from 1997 until May of 2006. The May 2006 guidelines were changed again effective December 31, 2011.
Calculating child support amount in Ontario
The starting point for the court in calculating child support in Ontario is the Child Support Guidelines chart. Having said that, the court has varying amounts of discretion to deviate from the Guideline amount in the following situations:
- A child is at or over the age of majority (18 years);
- Where the payor's income is over $150,000 annually;
- Where the payor is a step parent;
- Where there is a shared custody situation;
- Where there is a combination of split custody and one of the other factors set out herein;
- The existence of undue hardship;
- Existing court orders or agreements with special provisions;
- The consent of the parties.
In these cases, the court determines the appropriate amount of support with a view on the strict application of the Guidelines but without any legislative direction as to how to quantify the deviation from the Table amount. When dealing with these discretionary areas, the court and the parties' lawyers consider decisions in courts, at all levels, in Ontario and throughout the country.
Defining the income to be used for calculating support amount
According to the Guidelines, the starting point in defining the income to be used for calculating the child support payment amount is the income reported under "Total Income" in the income tax forms.
However, in some cases simply applying this Total Income amount does not fairly represent the annual income of the support payor because of historical income fluctuations or other non traditional income sources. For this reason, the court may decide to use the average total income for the past three years.
A different situation may arise if a spouse is a shareholder, director, or officer of a corporation, and the reported income does not fairly reflect the value of the services provided by the spouse to the corporation. In such a case, the court can assess the income up to the amount of the corporation's pre-tax income. The corporation's pre-tax income must not include any money or benefits given to people that aren't at arms length (e.g. relatives) - unless the spouse can prove that the payments were reasonable under the circumstances.
In addition, the court has a broad discretion to impute income in particular circumstances set out in the Guidelines. This includes situations where the spouse has been intentionally underemployed, unemployed, is exempt from paying federal or provincial income tax, or is paying income tax at a rate that is significantly lower than that in Canada or where there are unreasonable deductions of expenses from income or otherwise not generally utilizing his or her assets or capacity to earn.
Increasing support payment on the account of special expenses
According to the Guidelines the court may, on account of special or extraordinary expenses, order added child support in an amount higher than the one defined in the Child Support Guidelines chart. The Guidelines list six different types of such expenses:
- Child care expenses. These have to be incurred as a result of the custodial parent's employment, illness, disability or educational training for employment.
- Health and medical expenses which are attributable to the child.
- Health related expenses that exceed the healthcare reimbursement by at least $100.00 annually.
- Extraordinary primary or secondary school education expenses. Although post secondary school expenses will routinely be included in child support as add-ons, elementary or secondary school costs will only be included if they are extraordinary expenses. There are numerous court decisions indicating the struggle that the parties and the lawyers and the courts have in determining whether individual expenses qualify as an add on. These situations have to be dealt with on a case by case basis.
- Post secondary education. A non-custodial parent may be required to contribute to a child's reasonable post secondary expenses. There is no need to prove that they are extraordinary or special, the issue usually centers around the child's ability to contribute towards his or her own education and whether the claimed expenses are reasonable having regard to the parties means. It probably isn't reasonable for a child from an average working family in Ontario to decide to go to UCLA with no scholarship and expect his or her parents to contribute. This is a matter of common sense and applies to intact and separated families equally.
- Extraordinary expenses for extracurricular activities.This section has generated a great deal of controversy and is also comes down to a case by case determination based on the individual child and the family's history.
Undue hardship and the living comparison test
Section 10 of the Guidelines is often invoked but seldom applied. It provides that the court may award child support in an amount different than the one set out in the Guidelines if the court finds that the spouse making the request would otherwise suffer undue hardship.
The Guidelines set out circumstances that may cause undue hardship including: high debts incurred to support the family, high costs of exercising access to the child, an Order or contractual legal duty to support another person, rent, legal surety to support another child or a legal duty to support another person who is unable to care for themselves.
Satisfying one of these conditions does not automatically entitle the claimant to relief. Once that barrier is overcome, the next obstacle is to meet the threshold test to prove that the standard of living in the claimant's household is lower than the standard of living in the household of the other party. It is necessary to compare the income of all members of each household including the children when doing this calculation. This requires the parties to disclose the income of his or her other partner immediately. If undue hardship is proven and the claimant passes the standard of living comparison test, the court may then make a child support order in an amount that is different than that set out in the Guidelines. It is very rare in my experience that the undue hardship test is applied.
Changing child support payments
If you disagree with the way child support payment has been calculated in your case, or if you have problems making the payments, you could bring a Motion to Change (Vary) the child support order.