Child Support

Whether you are planning on filing for divorce or were in a cohabitating relationship, once parents separate, support for minor children is an issue that needs to be dealt with quickly. During the separation, children will likely spend more of their time with one parent than the other.

The parent who has the children most often experiences higher expenses for caring for the children. However, that parent is not required to bear the full financial support of the children and can seek help financially from the other parent.

Both parents have a legal responsibility to provide financial support for their dependent children. The other parent is required to pay child support to the parent to help them with expenses related to caring for the children.

What are dependent children?

Dependent children are considered any child under the age of 18 unless they have become independent by the age of 16, have married, or have voluntarily withdrawn from parental control. However, the law recognizes certain exceptions.

If a child is enrolled in a full-time post-secondary degree program or is considered disabled, then child support can extend beyond the time the child turns 18.

Who decides the support amount?

It is preferrable for parents to enter into their own agreement, without court intervention. When parents cannot agree, then you need to defer to one of our child support lawyers in Markham for assistance. We can assist you in creating a fair support agreement.

When the other parent is not willing to negotiate on the support agreement, we can help pave the way for family court and obtain an order of support from the court. Regardless of how the support agreement is reached, if non-payment is a concern, it is essential to apply to the court for an official support order. Doing so ensures the support order can be enforced by the Family Responsibility Office.

What information is used to determine child support?

The financial information for both parents is reviewed, including pay stubs, income tax returns, earnings statements, business financial statements, notices of assessments and reassessments, and other financial documents.

Both parents are required to submit this information to determine each parents’ financial contribution towards their minor children. In addition, the parent paying child support – the payor – is required to update their financial information whenever the other parent makes a request. Typically, this request can occur once a year.

Who enforces child support payments?

The FRO (Family Responsibility Office) is the entity that enforces child support payments. They do this in several ways, including:

• The FRO will act as an intermediary for the courts and the parents by handling the receiving and issuing of child support payments.
• The FRO will take the necessary action when payments are not made.
• The FRO will collect payments from payors when they are outside the jurisdiction where the children live most of the time with the other parent.
• The family court files all orders of support with the FRO automatically.

What guidelines are used to determine the amount of support?

Child Support Guidelines are used to determine the amount of support the payor will pay. These guidelines have tables for each territory and province in Canada that show the amount of support to be paid using the payor’s gross income.

In cases where a grandparent, stepparent, or other legal guardian has a financial responsibility to the minor children, the court may reduce the amount where it will be less than the Table Amount. The court may also reduce the amount of child support lower than the Table Amount in cases where parents have a Shared Parenting Time agreement or a Split Parenting Time agreement.

The court does this by determining the Table Amount payable by each parent. Then, they will subtract the smaller amount from the larger amount to determine the amount of child support the payor must pay.

What other financial expenses can parents be required to pay?

Special or extraordinary expenses like dental and health insurance premiums, extracurricular activities, daycare expenses, and medical expenses are other financial expenses the payor may need to contribute towards. These payments are in addition to child support payments.

What Table Amount applies to me?

The Table Amount the court applies to you will depend on the specific financial circumstances of your case. To illustrate, if the children live in Ontario and the payor lives in Manitoba, then the court uses the Manitoba Table Amount. On the other hand, if both parents reside in Ontario, the court uses the Ontario Table Amount.

In cases where one parent lives outside of Canada, like in the United Kingdom or the United States, and the children live in Ontario, then the court uses the Ontario Table Amount.

What do I need to know about Imputing Income?

The Child Support Guidelines allow for the imputation of income by the court based on that parent’s earning capacity. Imputing income is most often used when the payor is intentionally not working or underemployed to attempt to avoid their moral and legal obligation to provide financial support for their children.

Section 19 of the Federal Child Support Guidelines outlines different situations where the court can Impute Income. The judge has the discretion to decide based on various scenarios and situations not specifically listed in Section 19 of the Guidelines.

When determining child support amounts, the courts always place the child’s interests first and foremost and the right of the child to receive financial support from both parents, regardless of the parent’s interests.

As such, child support is considered a family law matter where the courts will intervene to ensure the children are receiving the financial support they deserve.

The Imputing Income provision reads as follows:

• 19. (1) The court may impute such amount of income to a spouse as it considers appropriate in the circumstances, which circumstances include the following:
  • (a) the spouse is intentionally under-employed or unemployed, other than where the under-employment or unemployment is required by the needs of a child of the marriage or any child under the age of majority or by the reasonable educational or health needs of the spouse;
  • (b) the spouse is exempt from paying federal or provincial income tax;
  • (c) the spouse lives in a country that has effective rates of income tax that are significantly lower than those in Canada;
  • (d) it appears that income has been diverted, which would affect the level of child support to be determined under these Guidelines;
  • (e) the spouse’s property is not reasonably utilized to generate income;
  • (f) the spouse has failed to provide income information when under a legal obligation to do so;
  • (g) the spouse unreasonably deducts expenses from income;
  • (h) the spouse derives a significant portion of income from dividends, capital gains, or other sources that are taxed at a lower rate than employment or business income or that are exempt from tax; and
  • (i) the spouse is a beneficiary under a trust and is, or will be in receipt of income or other benefits from the trust.

Family court judges can elect to impute a parent’s income to ensure both parents are jointly supporting their children financially. Parents have a financial obligation to their children based on their income and ability, as detailed in Section 26.1(2) of the Divorce Act.

Furthermore, family court judges have the discretion to decide when imputing income is necessary in cases where a parent’s earning capacity is greater than their reported income. This is quite common in cases where the payor is self-employed, and their income taxes do not reflect an accurate income amount due to tax write-offs, business write-offs, etc.

When is the court likely to impute income?

Imputing income by the court can occur for any of the aforementioned nine scenarios. It can also occur in cases where the payor is diverting their income in such a manner to make it appear they are earning less, to attempt to pay a lower child support amount.

The main issue in imputing income cases is ensuring the parent bears the financial consequences of their decisions, not the child. One of the top reasons courts imputes income is that the payor has intentionally left secure employment to become self-employed. The parent can do this for whatever reasons they decide.Yet, the payor parent must maintain their children’s standard of living and pay child support regardless of their business ventures and decisions.

Imputing Income Case

Case law is vital to imputing income cases as family courts have broad discretion to determine the amount of child support the payor parent must pay.

In Riel v. Holland, [2003] O.J. No 3901, 67 O.R. (3d) 417, the Ontario Court of Appeal held that the less taxes a parent paid, the more money is available to pay more in child support. So where a party has untaxed business income that are used for payment of their own personal expenses, the courts would gross up/impute income to them.

In Halliwell v. Halliwell, [2017] ONCA 349, the court held that to impute income to the other parent, it is not required to show that the other party actedimproperly in deducting expenses from their income. While it may be the norm from a tax perspective to deduct such expenses, the court may still impute income to the payor for child support purposes.

In Mullany v. Mullany, [2010] O.J. No. 3584, the family court said it was appropriate to impute income to a payor where they earn cash income that is not declared on their income taxes.

In Orszak v. Orszak, [2000] O.J. No. 1606, the court stated that evidence of lifestyle may be used to impute income to the child support payor.

In Hagner v. Hawkins, [2005] O.J. No. 4975, a parent abandoned his business to go back to school to pursue a new vocation. The court held that it was up to him to show the decision was reasoned, thoughtful and highly practical. The family court did not have to find that the payor intended to thwart his child support obligation. What had to be decided was whether he closed his business voluntarily, or if he was forced to do so because of business losses and whether the decision to return to school to train in a new vocation was reasonable.

In Wilton v. Myhr, [2019] O.J. No. 980, the family court said it could not find the husband intentionally underemployed, where he was a music producer and it was proven that technological changes in the way music is produced had impacted his ability to get contract work and thus affected his income.

How is child support related to parenting and contact orders?

Child support payments are independent of parenting and contact orders. A parent can still be obligated to pay child support even when they do not have any parenting time or contact with their minor children. Payor parents are equally allowed to continue to have parenting time and contact with minor children even when child support payments are owed to the other parent.

How can child support lawyers in Markham help?

Family courts can decide to impute the payor parent’s income for various scenarios either based on Section 19 of the Child Support Guidelines or of their own discretion.There are numerous circumstances and situations that could result in imputing income.

Our child support lawyers are experts and can determine how much income each parent is accountable for and how much their financial contribution towards child support will be. We make this determination using the payor’s gross income, the recipient’s gross income, and comparing these amounts and using the corresponding value in the Federal Child Support Table.

Whether you are the payor or the recipient parent, it is essential to be prepared for such matters and know when the court might impute your income.

At AP Lawyers, we have numerous years of experience in assisting parents with child support matters and when the court may decide to impute income to a parent. We can provide legal advice and representation when you find yourself in a situation where child support issues arise that need to be addressed and resolved.

Please feel free to contact AP Lawyers in Markham for a confidential consultation and the child support assistance you need today!