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Calculation of child support
Basic elements
4. Under the Rules, how is the amount of child support determined?
The calculation is based on
- the income of each parent;
- the number of children;
- custody time;
- additional expenses to meet the children’s needs, if any.
The first step is for the father and mother to jointly or separately fill out the Child Support Determination Form regardless of whether or not they have already agreed on the amount of support. The Form requires that the parents state their respective annual income (question 5), which in general is the income considered for the current year as established in Part 2 of the Form. 5. What annual income is taken into consideration when determining the basic parental contribution?
For the purposes of the calculation, the total annual gross income of each parent is established in accordance with section 9 of the Regulation and is entered in Part 2 of the Form, on lines 200 to 208 inclusively.
Annual income is income from all sources and includes
- wages, salaries and other remuneration;
- net income from the operation of a business or self-employment;
- employment insurance and parental insurance benefits;
- personal support payments from another person;
- interest, dividends and other investment income;
- net rental income;
- benefits paid under other legislation as part of a pension or compensation plan;
- other income.
Annual income includes all the income received by each parent, except the following amounts which are not considered to be annual income and therefore are not used in calculating disposable income:
- family-related government transfers (Canada Child Tax Benefit
 (CCTB), Child Assistance payments, Universal Child Care Benefit (UCCB), etc.); - amounts received under the Work Premium program;
- last resort financial assistance (welfare) benefits;
- amounts granted under a financial assistance program for education expenses managed by the Ministère de l'Éducation.
Note
On January 1, 2005, the Work Premium replaced the Parental Wage Assistance program. It targets the same objectives, but the amounts under the Work Premium program give rise to a refundable tax credit, and therefore are not considered as income as defined in section 9 of the Regulation.
Amounts under the new Child Assistance measure, which came into force on January 1, 2005, also constitute a refundable tax credit considered to be a family-related government transfer. Amounts paid under the Universal Child Care Benefit (UCCB), in force since July 1, 2006, are similarly considered to be a family-related government transfer. For this reason, all these amounts are not regarded as income as defined in section 9 of the Regulation. However, for the UCCB, the net annual amount (after tax) of the benefits received must be subtracted from the amount of net child care expenses, if any, entered on line 403 of the Form.
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Specific rules
Some specific rules have emerged from the way in which the courts have interpreted the legislation since it came into force in May 1997:
- all taxable and non-taxable benefits related to gross wages and salaries, commissions and tips are considered to be income;
- income from a business or from self-employment consists of gross income minus the expenses incurred to earn the income (a statement of income and expenses for the activities concerned must be submitted with the Form);
- employment insurance benefits include all benefits paid under public and private programs (private salary insurance benefits are taken into account);
- a spousal support payment made by a third party is added to the income of the spouse who receives it; support payments received for children who are not covered by the application are not included in calculating income;
- retirement, disability and other pensions include all amounts received as such, whether taxable or non-taxable;
- interest, dividends and other investment income that is actually received; in the case of dividends, the "gross-up" used when preparing an income tax return applies;
- net rental income consists of gross rental income minus related expenses (a statement of income and expenses for the rental property must be submitted with the Form);
- other income includes all other income of either parent that is not covered by another heading.
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Non-taxable income
Some income is non-taxable, such as the wages or salaries earned by Native workers on reserves, some disability pensions, and benefits received from the Société de l’assurance automobile du Québec (SAAQ) or the Commission de la santé et de la sécurité du travail (CSST). The amount received must be converted into the amount it would represent if it were taxable income, because the amounts in the Basic Parental Contribution Determination Table are gross (pre-tax) amounts.
To determine the pre-tax value of non-taxable income, you must take all your other income into consideration. Because these are tax-related calculations, it is recommended that you consult a tax specialist if you are unable to do the calculations yourself.
6. How is disposable income calculated?
The disposable income of each parent is calculated by subtracting the basic deduction specified in the Basic Parental Contribution Determination Table, as well as any union and professional dues paid, from the parent’s total annual income. Disposable income is calculated in Part 3 of the Form.
7. How is the basic deduction?
The goal of the basic deduction is to allow a parent to meet his or her main needs before being required to pay child support. The basic deduction is equivalent to the work income threshold at which a person living alone who has no severely limited capacity for employment is no longer eligible for social assistance benefits.
The amount of the basic deduction is adjusted each year, if necessary. It is indicated at the bottom of page 2 of the Basic Parental Contribution Determination Table. For 2012, the basic deduction has been set at $10,100.
8. What is the basic parental contribution?
The disposable income of both parents is added together, and the total is transferred to a calculation table called the Basic Parental Contribution Determination Table. The table gives the basic contribution for both parents based on their combined income and the number of children they have together. This contribution is presumed to meet the needs of the children and to be in proportion to the means of the parents. In other words, it is not necessary to prove the children’s needs. The contribution is considered to cover all the expenses for the children concerned, meaning that all their needs have already been taken into account in the table. However, the Rules also allow certain other expenses to be added to the amount given in the table so that the specific needs of a child may be taken into account. These include net child care expenses, net post-secondary education expenses and other net expenses specifically mentioned in lines 403, 404 and 405.
The Rules originally provided that the amounts listed in the table would be indexed on January 1 each year. However, since January 1, 2004, the table is no longer indexed although the amounts are adjusted to reflect changes in the federal and provincial tax systems. As in the past, however, court-ordered child support continues to be automatically indexed each year on January 1, unless the court judgment provides otherwise.
The basic parental contribution of each parent
The basic parental contribution of each parent is his or her share of the basic parental contribution. The amount is calculated using a distribution factor based on the relative size of each parent’s income.
Note
The calculations illustrated in the following examples are based on the Determination Table and the $10,100 basic deduction applicable as of January 1, 2010.
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Example of how to calculate the basic parental contribution of each parent
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Two former spouses have two dependent children. The mother's gross income is $20,100; the father's gross income is $40,100. Annual net child care expenses total $2,000.
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Father
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Mother
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Gross employment income
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$40,100
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$20,100
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Basic deduction
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$10,100
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$10,100
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Disposable income
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$30,000
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$10,000
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Disposable income of both parents
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$40,000
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Basic annual contribution of both parents according to the 2008 table
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$8,880
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| Basic parental contribution of each parent |
$6,660 |
$2,220 |
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Child care expenses (net of taxes)
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$2,000
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| Contribution of each parent to child care expenses |
$1,500 |
$500 |
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This example shows that the father's disposable income represents 75% of the total (combined) disposable income ($30,000 out of $40,000) and the mother's disposable income equals 25% of that total ($10,000 out of $40,000). These are the percentages used to determine the basic parental contribution of each parent, and also each parent's contribution towards child care expenses.
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9. What expenses related to children’s needs are eligible in the calculation of support?
Other expenses can be added to the basic parental contribution: net child care expenses (line 403), net post-secondary education expenses (line 404) and net special expenses (line 405), as provided for in section 9 of the Regulation. However, unlike the needs covered by the basic parental contribution, these expenses must be approved by the court, unless the parents have agreed on the amounts. The expenses may be taken into account to the extent that they are reasonable, given the needs and resources of each party.
Net child care expenses
The net child care expenses are the annual child care expenses paid to meet the child’s needs by the custodial parent in order to hold employment or receive training or because of the custodial parent’s state of health. Any benefit, subsidy, deduction or income tax credit relating to the expenses must be deducted from the total, such as the Universal Child Care Benefit (UCCB) paid to the parents. Since the UCCB is taxable, the net after-tax amount received must be used to reduce the amount of net child care expenses. Each parent must therefore calculate the tax benefit related to the expenses and deduct it from the gross amount of the expenses paid. The net cost of child care expenses will be divided between the two parents in the final calculation of child support.
Net post-secondary education expenses
Net post-secondary education expenses are the annual expenses paid to enable a child to pursue a post-secondary education. They include tuition fees, the cost of compulsory books and materials, and necessary transportation or housing costs. Any benefit, subsidy, deduction or income tax credit relating to the expenses must be deducted from the total, as must any amount received by the child as a student loan or bursary. Each parent must therefore calculate the tax benefit related to the expenses and deduct it from the gross amount of the expenses paid. The net cost of post-secondary education expenses will be divided between the two parents in the final calculation of child support.
Net special expenses
Net special expenses are expenses other than child care expenses and post-secondary education expenses, such as medical expenses or the costs relating to a child’s elementary or secondary education, another educational program or extra-curricular activities, that relate to a need created by the child’s particular situation. Any related benefit, subsidy, deduction or income tax credit must be deducted from the total. Each parent must therefore calculate the tax benefit related to the expenses and deduct it from the gross amount of the expenses paid. The net cost of the special expenses will be divided between the two parents in the final calculation of child support.
Included as special expenses that give rise to tax benefits are medical expenses and amounts paid in certain cases as school boarding fees or summer camp expenses. In certain specific circumstances, the school boarding fees and summer camp expenses are considered for income tax purposes to be child care expenses.
If the parties cannot agree on the necessity of the expenses, the court will decide whether they will be allowed, and the amount.
10. What are the various types of custody?
Part 5 of the Form concerns the various types of custody.
The custody of a child is considered to be
- sole custody if one parent assumes more than 60% (219 days) of custody time;
- shared custody if each parent assumes at least 40% (146 days) of custody time.
The arrangement is considered to be sole custody with visiting and prolonged outing rights when the non-custodial parent assumes more than 20% (73 days), but less than 40% (146 days), of custody time.
Examples of the calculation of custody time
Before looking at examples of how to calculate custody time, it is important to understand what “custody time” means. Section 9 of the Regulation states that “custody time” means the time during which a parent has the custody of a child or exercises visiting and outing rights in respect of a child, whether or not the child is in the care of a third person during that time. For example, if the mother has sole custody, all the time spent by the child at a day care centre is included in the mother’s custody time.
Note
The following examples are given for guidance only. The actual figures may vary depending on the year considered (the schedule ( 29 Kb) varying from one year to the next) and the particular situation of each family.
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Sole custody, with the non-custodial parent assuming 20% or less of custody time
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Alternate weekends (24 weekends x 2 days)
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48 days
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2 weeks during summer (2 weeks x 7 days)
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14 days
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5 days at Christmas
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5 days
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Total (67 days ÷ 365 days x 100 = 18.36%)
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67 days
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Sole custody, with the non-custodial parent exercising visiting and prolonged outing rights representing between 20% and 40% of custody time
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Alternate weekends (23 weekens x 2 days)
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46 days
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3 weeks during summer (3 weeks x 7 days)
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21 days
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5 days at Christmas
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5 days
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1 additional day every two weeks (23 weeks x 1 day)
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23 days
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Total (95 days ÷ 365 days x 100 = 26.03%)
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95 days
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Shared custody, with each parent assuming from 40% to 60% of custody time
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Extended alternate weekends (Tuesday evening to Sunday evening) (23 weeks x 5 days)
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115 days
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4 weeks during summer (4 weeks x 7 days)
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28 days
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1 week at Christmas ( 1 week x 7 days)
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7 days
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Total (150 ÷ 365 days x 100 = 41.09%)
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150 days
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11. What is the financial impact of each type of custody on the calculation of child support?
Under the Rules, the percentage of custody time affects the amount of child support. Using the same figures as in the examples above, the financial impact of the various types of custody would be as follows.
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The mother has sole custody
Division 1 of Part 5 of the Form
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Basic annual contribution of both parents
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$8,880
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Basic parental contribution of the mother (25% of the basic annual contribution of both parents)
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$2,220
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Share of child care expenses assumed by the mother (net of taxes) (25% of $2,000)
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$500
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Total contribution of the mother
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$2,720
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Basic parental contribution of the father (75% of the basic annual contribution of both parents)
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$6,660
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Share of child care expenses assumed by the father (net of taxes) (75% of $2,000)
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$1,500
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Total contribution of the father and child support payable
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$8,160
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The mother's total contribution is not paid out but represents the share of her disposable income that she spends on her children, of which she has sole custody. The father is required to pay his share to the mother, namely his basic parental contribution plus, in this example, his share of child care expenses.
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The father has sole custody
Division 1 of Part 5 of the Form
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Basic annual contribution of both parents
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$8,880
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Basic parental contribution of the father (75% of the basic annual contribution of both parents)
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$6,660
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Share of child care expenses assumed by the father (net of taxes) (75% of $2,000)
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$1,500
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Total contribution of the father
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$8,160
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Basic parental contribution of the mother (25% of the basic annual contribution of both parents)
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$2,220
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Share of child care expenses assumed by the mother (net of taxes) (25% of $2,000)
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$500
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Total contribution of the mother and child support payable
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$2,720
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The father's total contribution is not paid out but represents the share of his disposable income that he spends on his children, of which he has sole custody. The mother is required to pay her share to the father, namely her basic parental contribution plus, in this example, her share of child care expenses.
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The mother has sole custody (74% of custody time) and the father has visiting and prolonged outing rights (26% of custody time)
Division 1.1 of Part 5 of the Form
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Basic annual contribution of both parents
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$8,880
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Total parental contribution (including child care expenses net of taxes)
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$10,880
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Adjustment for the father's visiting and prolonged outing rights (26% - 20% = 6% x $8,880)
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$532.80
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Adjusted basic parental contribution ($10,880 - $532.80)
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$10,347.20
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Contribution of the mother (25% x $10,347.20)
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$2,586.80
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Contribution of the father and child support payable (75% x $10,347.20)
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$7,760.40
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The adjustment for visiting and prolonged outing rights is calculated on the contribution of both parents, and not directly on the support payable. The purpose of the adjustment is to encourage the non-custodial parent to exercise visiting rights which, in this example, would allow the children to spend more time with their father. Also note that, as shown in the above example, no adjustment is made to the first 20%.
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Custody shared equally between mother and father (50% - 50%)
Division 3 of Part 5 of the Form
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Father
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Mother
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Basic annual contribution of both parents
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$8,880
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Basic parental contribution of each parent based on disposable income
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$6,660
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$2,220
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Cost of care for each parent
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$4,440
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$4,440
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Child support payable by the father
$2,220 ($6,660 - $4,440) + $1,500 (child care expenses net of taxes)
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$3,720
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Child support payable by the mother
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$0
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In this case, the cost of care for each parent is based on the following calculation:
Basic annual contribution of both parents x percentage of custody time:
$8,880 x 50% = $4,440
Where custody is shared equally, the basic annual contribution of both parents is divided equally. In this example, the child support payable by the father to the mother is established by subtracting the cost of care for each parent from the support contribution, and adding the applicable share of child care expenses.
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Effects of shared custody on the division of joint expenses
In cases of shared custody, the division of joint expenses is often a point of dispute. Joint expenses are the expenses paid from time to time on goods or services such as clothes, school supplies, sports activities, etc.
In cases of sole custody, the situation is simpler, since the amount of the support payment covers all the expenses related to caring for a child (housing, food, clothing, education, health, recreation, etc.). The only expenses paid for directly by the non-custodial parent are those incurred directly as a result of visiting and outing rights.
In cases of shared custody, child support compensates for the difference between what each parent is expected to pay to meet the needs of the child (the basic parental contribution, line 531) and what that parent actually spends (the cost of care, line 532), to ensure that each parent has the necessary resources to cover the cost of meeting the child’s needs. Once the support amount has been determined in line 534 (annual support payable), the joint expenses should be paid by each parent in proportion to custody time. However, in reality it is sometimes difficult to keep track of the expenses and it may be easier for the parents to find another way to divide them up. For example, they could estimate the annual cost of clothing, and one parent could then pay the other the relevant percentage of the total (between 40% and 60%), leaving that parent with full responsibility for buying the clothes.
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The mother has sole custody of the first child, and custody of the second child is shared between the parents (50% - 50%)
Division 4 of Part 5 of the Form
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Father
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Mother
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Basic annual contribution of both parents
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$8,880
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Average cost per child ($8,880 ÷ 2)
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$4,440
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SOLE CUSTODY
Cost of care for the child in sole custody
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$4,440
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Basic parental contribution of each parent
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$3,330
(75% of the average for the child)
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$1,110
(25% of the average for the child)
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Basic annual child support for the child in sole custody
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$3,330
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SHARED CUSTODY
Cost of care for the child in shared custody
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$4,440
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Basic parental contribution of each parent
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$3,330
(75% of the average for the child)
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$1,110
(25% of the average for the child)
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Cost of shared custody for each parent ($4,440 x 50 %)
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$2,220
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$2,220
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Basic annual child support payable for the child in shared custody
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$1,110
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SUMMARY
Basic annual child support for the child in sole custody
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$3,330
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Basic annual child support for the child in shared custody
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$1,110
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Total basic annual child support
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$4,440
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Contribution for expenses (75 % of net child care expenses)
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$1,500
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Total annual child support payable
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$5,940
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In a situation involving a combination of types of custody, the first step is to calculate the average cost for one child, which is the amount in the Basic Parental Contribution Determination Table divided by the number of children concerned. That average amount is then used in the calculation for each type of custody, taking into account the number of children concerned. In the above example, one child is in sole custody and one is in shared custody; the average cost for one child is used in the calculation for each type of custody. At the end of the Division, the Summary adds the support amounts payable for both children to the contribution for child care expenses, giving the total annual child support payable.
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12. Do the Rules have an impact on the method used to calculate the amount of spousal support paid to a former spouse?
Although the support determination model does not apply to spousal support, it stipulates that spousal support amount is determined after the child support amount has been established.
This is to ensure that the child support will not be reduced because, for example, a parent maintains that he or she is already paying spousal support to the former spouse.
The method used to determine spousal support payable to a former spouse is still the method developed over the years in the case law, based on the provisions of the Civil Code of Québec and the federal Divorce Act .
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On May 1, 1997, a new model for the determination of child support came into force in Québec. As a result, major changes were made to the way the amount of support for children is calculated when their parents separate or divorce.
