January 28, 2022
Alimony. Spousal Support. This will help you make sense out of things you have heard.
Alimony means financial support for a spouse given to them after a separation or divorce. However, it is not a word in Canadian law. Alimony is an American legal term. Draw a bright line in your mind – alimony (American) – and then on this side of the line, the Canadian phrase which is “spousal support”.
In Ontario law, it is the term given to financial assistance (read: money) that one spouse may have to pay to the other one following a divorce or separation. It applies to common-law couples as well as married couples. It is typically paid to the spouse monthly but can be paid biweekly, yearly (very rare), or as a lump sum.
Spousal support is directed by the Divorce Act or the Family Law Act in Ontario. Those are the laws that say one spouse has an obligation to support the other after their relationship breaks down.
Those laws are then guided by the Spousal Support Advisory Guidelines. These guidelines are not the same as the Child Support Guidelines. The Child Support guidelines are actual laws that are in writing that the government enacted. That means you can go to the piece of law that the government produced that says how child support is supposed to be paid. You can find this on helpful websites like mysupportcalculator.ca. However, the Spousal Support Advisory Guidelines are not government-made law. They were created when the government requested advisory guidelines from two research university professors. They spent an extensive amount of time analyzing all the cases across the country. They assessed spousal support cases with children and without children. Cases where parents were together for a short period of time. Cases where the couple separated after a very long time.
As a result of that they produced the Spousal Support Advisory Guidelines. Quite frankly, before they produced the guidelines, the law on spousal support was “one hot mess”. We are very grateful to have guidance on this area from these guidelines as it was horrible to try and advise people before. It really was the wild-west if you can call any area of law that.
Unfortunately, the guidelines are not a simple table that you can look up to get a simple answer. They are based on at least five factors. You can find the spousal support advisory guidelines and the revised users guide to the supposable support advisory guidelines at the following two links.
Tax. Spousal support, if paid monthly, is tax-deductible to the person who pays it. For example, this means that if you earn $100,000 per year and you pay $25,000 per year in spousal support you get to deduct $25,000 from your income. You will get a healthy tax refund in April when you file your taxes. Important to keep in mind for your own cash flow is that you may want to have your employer change the amount of tax they hold back from you so that you will have more cash per month. If you are paying spousal support, it can often be frightening to look at the amount you need to pay when you look at the amount of your take-home pay.
The thing to remember for recipients is that spousal support is taxable. You get the opposite situation. If you receive $2000 per month in spousal support, you had best talk to a tax professional to learn how much money you should send to Revenue Canada. If you spend the whole $2000 and save none of it for Revenue Canada, you might have a nasty shock when you prepare your income tax return. The Canada Revenue Agency can give you some assistance on how much you should send to them (we recommend paying them each month) based on your already earned income plus the amount of support you receive.
Yes. There are many situations when a paying spouse will be paying both child support and spousal support. A lot of the time it depends upon everyone’s income and where the children are living to determine how much of each is paid. Child support is prioritized. It comes first. It will suppress spousal support based upon the number of children for whom child support is being paid. You may wish to get some specific legal advice on how to manage or determine child and spousal support in your case
For further reading on the Guidelines, we refer you to the Guidelines themselves. The guidelines are very detailed in the ranges of support you could pay or receive. The Guidelines do create a formula of a low, middle range, and a high end of support. The location in those ranges vary widely. Some examples are situations with young children and short relationships, others are adult children as well as situations where you have teenage children and longer-term relationships. Because this is a difficult area of the law we recommend specific legal advice tailored to your situation.
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