How is Child Support calculated in Ontario?
This is usually one of the first question I get asked in pre-mediation meetings with clients. If this is a fear you have, please know that in mediation, we discuss how financial obligations are calculated and the entire financial picture, in order to support both households.
When divorcing, the fear of paying child support is common, especially when considering the staggering costs of raising a child. According to the Government of Canada website, the average cost of raising a child from birth to 17 years old in Canada, is about $293,000. This averages about $17,235 per year and is a growing expense as inflation fluctuates. This rising cost effects divorcing and separated families harshly as splitting the household into two can be financially detrimental. This is why certain considerations are taken into account when calculating financial supports, like child support and spousal support.
In Canada and Ontario child support is always considered the right of the child. This principle is meant to support the lives of children in whichever home they reside in. The amount of appropriate child support is calculated according to the "federal base child support table," which is updated yearly by the Government of Canada. The child support table lookup tool is an online version that can be used to calculate the appropriate base amount. Courts routinely uphold these calculations and will not regularly allow parents to forgo the payment of child support, even if both parents are in agreement.
This calculation takes 3 main factors into account when determining child support. These include the payor's income, the province of residence, and the number of children to be supported.
The payor’s income: This amount plays a critical role in determining an appropriate child support obligation.
This is because the courts and Canadian law have upheld that child support is the right of the child, which means they must be financially supported by both parents. This legal obligation does not disappear when parents' divorce or separate; and includes situations where the parents never married. When this is applied to court, it can mean that if a judge is not satisfied that a parenting plan adequately supports the child, then they can remedy the issues in court with orders; or parties can agree to go back to mediation.
Province of residence: When calculating the base child support amount, the province of residence for the payor is used to calculate how much support should be paid. This is because the cost of living between provinces can differ and thusly affect the table calculation.
Number of children: With each additional child, the amount of support can increase.
Parenting Time
Another factor that can affect the child support amount is parenting time. A parent who has the child in their care for at least 40% of the time, is entitled to child support. For example, I once had clients who equally split their parenting time, and incorrectly thought that there was no child support obligation. In reality, one parent had a significantly higher income, which meant the child was living in two distinctly different financial settings. I explained that each parent is entitled to some sort of claim amount, which means an offset calculation needed to be determined. In this scenario, the calculation showed that the higher income parent owed the other parent (who made significantly less), about $540 a month. This number was calculated based on how much each parent would be entitled to, and the difference was paid to the lower-income parent. This type of parenting plan is called a Shared Parenting agreement.
Another similar type of agreement can be Split Parenting where each parent has at least 1 child living with them. Similarly to a shared agreement, each parent's entitlement is calculated based on the other's income, number of children, and province of residence. An offset amount is then calculated based on both parent's entitlements.
It is imperative to a successful divorce that the correct amount of child support is paid. Even if clients agree to forgo the amount (like the example above), the court will want an answer as to why there are unclaimed arrears of child support. As I explained to my clients, the principle of child support is the right of the child; that means parents cannot opt-out of paying or receiving child support; even when they are in agreement. This could have been an extremely expensive lesson to learn in court, as they would have ordered arears of child support; thus delaying the divorce, adding lawyer fees, court appearances, and a recalculation of spousal support.
S.7 expenses:
Since these are base table calculations, there can be added expenses related to child rearing in the form of S.7 expenses. A S.7 expense is meant to cover expenses outside of basic needs (food, shelter etc.) such as extra-curricular activities, daycare costs, special medical expenses, post-secondary costs etc. These costs are calculated based on the percentage of both parents' incomes. For example, if the yearly income of parent A is $90,000 and parent B is $50,000, then parent A pays 64% and parent B pays 36% of all S.7 expenses.
Special considerations: Undue Hardship
In some cases, the payor spouse may not have the ability or current circumstances to pay child support obligations. In these cases, Undue Hardship can be an argument used in court to lower support obligations. The court has a high threshold when it comes to hearing arguments about Undue Hardship and will use the "Household Standards of Living Test," in order to determine if the Undue Hardship exception applies. This test is meant to calculate all money coming into both houses, and then determining if the payor's standard of living is lower than the other parent's home. If it is determined, then the court may lower the child support obligation, however proof of Undue Hardship does not guarantee a reduction, (Steps to Justice.ca).
Are you interested in learning more about mediating your divorce? Contact me today at (647) 482-4987 or info@ERFmediation.ca or calendar link.
Disclaimer: The legal information contained in this blog post is for the purposes of sharing legal concepts and general legal information only. This post is NOT legal advice, but rather legal information.
