Alimony (Spousal Support)
This article is quite long, but hopefully covers everything you need to know about alimony, which in Canada is called spousal support. In addition, if you have a question that is not answered here, please feel free to contact us for more information.
Except for Quebec, the information here applies in all provinces in Canada, namely Ontario, British Columbia, Alberta, Saskatchewan, Manitoba, New Brunswick, Prince Edward Island, Newfoundland, and Nova Scotia. Despite the similarity in law across the country, there is a fair amount of judicial discretion involved and in some locations judges appear to be more generous in awarding alimony, particularly in large urban areas.
Spousal Support (Alimony) Basics
In general, if one spouse earns more money than the other spouse, he/she may have to pay spousal support. There is no set formula for the amount of alimony, although there are a set of non binding spousal support guidelines that judges and lawyers follow. Despite this, spousal support is decided on a case-by-case basis, and there is a lot of variability in the results.
Gender Bias and Alimony (Spousal Support)
Officially, alimony is not based on the gender of individuals. Men and women alike have to pay spousal support, although generally more men than women pay spousal support. However, the court will not look at the sex of an individual and base their decision on that factor.
In my opinion, however, there do tend to be subtle biases in the courts in awarding alimony: it’s rare that men are considered economically dependent on their wives, even when they earn significantly less than their wives do.
How Alimony (Spousal Support) is Determined
There are a number of factors that are considered in determining the amount of alimony, including the parties’ assets, incomes, ages, health, standard of living, ability to be self-sufficient, contribution to each other’s career, length of marriage, and more.
Basically, a judge will review all of the economic factors that affect each party, with particular emphasis on the effect of the marriage and the divorce on the parties’ financial circumstances, then try to apportion the family income in a fair way between the spouses.
There are also spousal support guidelines that guide judges in this exercise, but they are non binding on the judge.
How Long Must One Pay Alimony (Spousal Support)
For longer-term relationships, as well as in cases where the parties’ have children, the courts generally do not place a time limit on alimony. This does not mean you’ll need to pay spousal support forever or that you’ll receive spousal support forever. It just means that courts do not want to engage in an exercise of gazing into a crystal ball too many years ahead to see what each spouse’s financial situation will be in the future. If you or your spouse’s financial situation changes materially – for instance when you retire, it is always open to you to go back to court to end spousal support or change it to a different amount of alimony.
In short-term relationships where there are no children, particularly when the couple is young, alimony is normally time limited.
A type of spousal support order that is becoming more common is known as a “review order.” Under a review order, the court will say that the amount of alimony can be reviewed after a certain number of years. This gives you the opportunity of going back to court to modify your spousal support order without the necessity of showing that your or your spouse’s financial situation has changed. However, it’s not a guarantee that spousal support will be changed – a review order simply opens the door to allowing a court to looking at the alimony situation again.
Review orders for alimony are commonly made where one spouse is out of the workforce, but is expected to get back into the work force, particularly after some training or education.
The Unfaithful Spouse
Infidelity has no effect on alimony. Yes, it sucks to pay a lot of money each month for the rest of your life to someone who spent their time having affairs while you spent it advancing your career. However, divorce, child custody, child support, spousal support, and property division are all no fault in Canada.
Is Alimony Tax Deductible?
Yes it is. As well, the income is taxable in the hands of the recipient.
Temporary Spousal Support, Interim Spousal Support & Permanent Spousal Support
Temporary or interim spousal support is spousal support awarded after separation but before divorce. This amount of spousal support is just a quick and rough amount determined to tide the spouses over until the divorce and a more detailed analysis can be made. When the divorce is granted, spousal support is made final. However, the reality is that the amount of interim or temporary spousal has a great effect on the final order of spousal support; often the two are the same.
Spousal Support Guidelines – How Much Do I need to Pay?
Determining the correct amount of alimony is more of an art than a science. There are spousal support guidelines in place to help make this determination.
The Spousal Support Guidelines are simply recommendations, not rules. However, judges generally follow them and the courts have stated that if a judge awards an amount of spousal support that is significantly different from the Spousal Support Guidelines, the judge must give reasons why this is the case.
Here is roughly what you can expect (based on a paper by Mackinnon J and Murray):
- Where no child support is being paid, the recipient spouse’s income was 36.6% to 44.5% of the families’ net disposable income (income less tax, CPP & EI).
- In cases of shared or split custody the family’s net disposable income is divided approximately equally between the two spouses.
- When one child is living with the alimony recipient, the recipient typically receives 45-50% of the family’s net disposable income.
- When two children are living with the spousal support recipient, the recipient typically receives about 55% of the family’s net disposable income.
- When three children are living with the alimony recipient, the recipient typically receives about 60% of the family’s net disposable income.
- When the children are in the care of the spousal support payor, the custodial parent typically keeps about 60% of the family’s net disposable income. The alimony recipient usually receives what would be given if there were no children.
Some important things to note about the amount of alimony awarded:
- For higher incomes (family incomes of over $150,000 per annum), the amount of spousal support as a percentage of the family’s net disposable income will normally be lower.
- For lower family incomes (family incomes below $50,000 per annum), the amount of spousal support as a percentage of the family’s net disposable income will normally be lower, as there’s simply not enough money to go around
- If the spousal support recipient is not making good efforts to earn an income, normally a lower amount of alimony will be ordered.
- If the spousal support payor doesn’t voluntarily start paying alimony right away, usually a higher amount of spousal support is awarded. Conversely, voluntarily paying alimony right away normally results in a lower amount of spousal support being awarded.
Is that high?
You need special calculators to figure all of these amounts out. Here’s a sample calculation.
Say you, the husband, earn $100,000 per year. Your wife, who is a stay-at-home mom, has custody of your two teenage children. Miraculously, your children don’t have any unusual expenses (that means that they don’t play hockey or any other sport, don’t take music lessons, don’t need orthodontal work, etc. – in other words, a very unlikely situation).
Under this scenario, you’d pay $1,240 per month in child support, and you’d pay (on average) $2,316 in alimony (which is tax deductible). In addition to this, your income taxes, CPP and EI would total $1,487 per month. This would leave you with a grand total of $3,074 per month clear to live off. As you can see, after payment of rent, car and food, that’s not a lot.
Note – this is just an example based on averages. It does not mean that if your in this situation, this is what you’ll pay. It simply means that on average, that’s what people in your situation pay.
Spousal Support Calculator
To calculate the amount of alimony payable under the Spousal Support Guidelines, you need to use special software that family law lawyers and judges have access to. Unfortunately, this is not something available to the general public. While there are online calculators available, these are not identical to the software used by judges. If you live in Ontario, you can retain us to do this calculation for you. In each province, the calculation will be slightly different, primarily due to different tax rates.
Normally, the current income of the parties is used in calculating the amount of alimony payable. However, what happens if someone is purposely not working or working at a job far below their potential? In these cases you can ask the court to impute an income – that is, calculate alimony as if your ex had a higher income than they actually do. Note that the judges understand that these are difficult economic times and all that they are looking for is that a person makes best efforts. They are understanding that someone may be unemployed despite legitimate efforts not to be.
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