What are the terms used?

The support payor is required to pay spousal support. The support recipient is entitled to receive spousal support.

What are the 4 situations a person must fall into to make a claim for spousal support?

A person must fall into one of the four following situations:

• The person must be legally married to person from whom they are claiming support
• The person has lived continuously for a period of not less than 3 years with person from whom they are claiming support
• The person must be in a relationship of some permanence and the parents of natural or adoptive parents of a child
• The parties have entered into a domestic contract

What factors determine entitlement?

Entitlement to spousal support may be determined by one or more of the following factors:

• length of time partners have lived together
• if partners have children together, and if so, who has been caring for them
• each partner’s income
• each partner’s overall financial situation

Duty to become self-sufficient → even when entitled to spousal support, there is an expectation for the support recipient to try to become self-supporting where reasonable after separation.

What is purpose of spousal support according to Divorce Act and Ontario’s Family Law Act?

Spousal support has the following purposes:

• recognize the spouse’s contribution to the relationship and economic consequences
• apportion between spouses any financial consequences arising from care of any child (unable to work)
• to promote economic self-sufficiency of each spouse
• to relieve any financial hardship

What are three types of claims you may be entitled to?

Compensatory → you may be entitled to compensatory support if responsibilities, such as caring for your children or helping your partner build their career, prevented your own career

Noncompensatory → you may be entitled to needs-based support if you are in need, following the breakdown of your relationship, and your partner has sufficient income and assets to pay spousal support. The Court will look at your assets which are things that you own to determine if you need spousal support. For example, assets include cars, real estate, registered retirement savings plans (RRSPs) and any savings you have. Assets include property like cars, real estate, Registered Retirement Savings Plans, and any savings. This is to ensure you can support a lifestyle close or equal to the one you had during the relationship.

Contractual → you and your partner have a cohabitation agreement, marriage contract, or other agreement stating you are entitled to spousal support upon separation (or that your partner will pay spousal support). These are very rare.

Who is entitled to ask for spousal support?

The support recipient must demonstrate they are legally entitled to spousal support; entitlement to spousal support is not automatic. 

Spousal support is often requested by the spouse with a lower income, but one is entitled to spousal support if payment is to:

• compensate a spouse who sacrifices their ability to earn income during the marriage
• compensate a spouse for the continuing care of children, over child support obligations
• help a spouse in financial need, when this need arises from the divorce or separation

What factors does a judge consider?

A judge will consider each party’s conditions, means, needs, and circumstances, including:

• legal agreements between the parties
• the duration of the relationship
• how long the parties lived together
• the roles each partner had during the marriage (e.g. if one was the primary or sole income earner)
• the means of the support payor
• the needs of the support recipient
• the support recipient’s budget
• if the parties have children together and who has been caring for them
• whether the payor is also paying child support
• each partner’s income
• each partner’s age
• each partner’s mental and physical health
• the ability of each partner to support themselves

How does the CRA handles support payments? Note: the FRO does not issue year-end statements, keep records of support payments

• Support Payor – Spousal support is tax-deductible for the support payor; the support payor can claim a deduction for making monthly spousal support payments.

• Support Recipient– The partner receiving support is taxed on the monthly spousal support they receive as income.

• Child Support– Child support is not taxable for the payor parent. The payor parent cannot claim a deduction for making child support payments, and parents receiving child support are not taxed on the child support they receive.

A separation agreement or court order should clearly indicate if there are separate amounts for spousal support and child support. **If there is only one amount for both types of support, the Canada Revenue Agency will view the whole amount as child support.

Are lump sum payments tax deductible?

A lump sum payment is generally not tax deductible as a support payment, as it is not paid on a periodic basis. 

For a support payment to be taxable to the recipient and deductible by the payor:

• The court order or written agreement must clearly state the amount to be paid to the spouse or common-law partner
• All child support payments, if applicable, must be paid for the current and previous years

Other amounts generally not tax deductible as support payments:

• prepayments: lump sum payments made in place of several periodic payments that were required by a court order or written agreement, but were not yet due to be paid
• the prepayment may be considered a support payment if it was made solely to secure funds to the recipient
• lump sum payment made under a written agreement for a period before the date of the written agreement
• instalment payments of a lump sum amount
• payments releasing the payor from any obligation to pay overdue support, future support, or both

What are some general rules about spousal support?

• Spousal support always ends when the support recipient dies.
• Spousal support does not always end when the support payor dies if there is life insurance or assets from which spousal support can still be paid.
• The Family Responsibility Office will not enforce support orders against the estate of the support payor.
• Spousal support does not automatically end when the support recipient lives with or marries someone else.
• Spousal support does not automatically end when the support payor retires.