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Financial Issues This forum is for discussing any of the financial issues involved in your divorce.

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  #21 (permalink)  
Old 04-05-2015, 06:52 PM
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My husband and I are dealing with this exact issue and heading to CC on Friday. His ex has never asked him for s.7 or daycare expenses. When we got her financials, she has received over $25,000 in tax benefits and CCTB over the past 4 years and is now wanting half of of the $16,000 in daycare and s.7 expenses from him. I too, searched exhaustively for case law but to no avail. She had been in a long term relationship with someone as soon as my husband and her separated and she never requested payment. Now that she is single she needs money. So I completely understand now the lawyers deception and cheating methods to get a settlement.
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  #22 (permalink)  
Old 04-15-2015, 04:48 PM
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I just got off the phone with CRA and have the paper work in front of me.

COMPLICATED and sorry for the length.

I live in Manitoba, single parent and no new partner, my ex in Quebec with stay home wife and new child.
We are "joint" w me primary care/control etc.
We have been scratching out an order now for 10yrs. (Yes, 10 yrs!). My ex has avoided a final order which means his garnishiment would be updated to the correct amount. (His income 173,000)

So now with the end in sight my ex has now brought up my arrears for my tax benefits on my son.

My income (with 2 jobs) is about 45,000. My ex is at 173,000.
My ex is obligated for daycare/camps etc at 80% (total 1800.00/yr) as well as activities. W Activities he pays 100.00 per month (max 1200.00)

I do 2 tax returns one with child and one without. This year as with previous yrs the difference in claiming my son is $5.00. Along with cultural and physical activity benfit and daycare claimed with child.
I am getting 4705.00 and if I didnt claim my son 4700.00 (basically)
(I have provided this info in previous yrs)

Prior to this yr my ex found the return too little to bother with.

This yr, he has changed his mind and brought it up as outstanding owed to him.
Now how do i go about figuring out what he wants from this?
My net income is low DUE to tuition for myself, rrsps, and legal costs, plus I pay extra taxes etc. (I go to school as well when I can, and have been hoarding credits and rrsps to keep me at a lower tax bracket).


With CRA: they say he is not eligible. its based on my net income. its based on primary care for the child (me) and Quebec has diff programs/laws. he in fact would not be eligible to claim it even if i gave it to him.
If there is a squable over it...CRA will refuse to pay it out. They also made a mention of the male/female ratio on the call and in the infromation. I would need to authorize him to try to claim it or have it paid out to him as its not for his specific benefit but the childs. So CRA has made it very clear its not a perk BUT something that goes for the child.

I dont want to be stingy. I pay into my sons resps, insurances, and private school on my own, plus food, clothing, shelter, bdays, everyday LIFE.
But I dont feel he has a right to it BUT extra income for my son's benefit and his expenses.
Lawyer says to shut up about it. for me to document and provide what info i have and let him stew in it. (i have family wizard which keeps the uploads and posts) My ex doesnt bother reading it.

Am I wrong? and what would be fair in this situation?
Im worried that this will be brought up again one day when I claim arrears. (its inevitable). So im trying to be proactive.

Sorry for the length.
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  #23 (permalink)  
Old 04-15-2015, 04:55 PM
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Quote:
Originally Posted by COURTISMYLIFE View Post
My husband and I are dealing with this exact issue and heading to CC on Friday. His ex has never asked him for s.7 or daycare expenses. When we got her financials, she has received over $25,000 in tax benefits and CCTB over the past 4 years and is now wanting half of of the $16,000 in daycare and s.7 expenses from him. I too, searched exhaustively for case law but to no avail. She had been in a long term relationship with someone as soon as my husband and her separated and she never requested payment. Now that she is single she needs money. So I completely understand now the lawyers deception and cheating methods to get a settlement.
I would think a settlement would be for the outstanding owed. parents ahve a financial repsonsbilty. its fine to move on...but the first child has to be taken care of.

Not sure if this pertains or not but what was the reason your partner wasnt paying these expenses in the first place?
Regardless of the governement money she received. I would think that the expenses for the child would be paid by both parents first.
Why would the parent with the child be footing the bill waiting for the govt money to arrive? Government doesnt replace the parents responsbilty. I would think that the government money is a perk to helping the childs betterment and circumstance, providing opportunity. Why would he get a discount off of what he needs to pay?
What would that have to do with the lawyer or his cheating methods in trying to get a settlement?
Im not sure I agree with this view.
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  #24 (permalink)  
Old 04-15-2015, 04:59 PM
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How did u get a 25% tax benefit? how is that the average? I contacted CRA and have been told its 10%
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  #25 (permalink)  
Old 04-15-2015, 06:58 PM
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Most agreements state one parent can claim the cctb uctb or whatever the equivalent to spouse is. I dont think thats what hes talking about. What he is probably talking about is his share of the benefits for s7 expenses like daycare etc. hes supposed to pay the NET COST of the expense which is the total cost minus the taxable benefit split proportionate to income. So if daycare is $1000 and the tax benefit is $200 that means you split the $800 proportionate to income. If hes been paying the split on $1000, you have to pay him back his share of the $200 you get back in taxes.

At least thats how Im reading this. Others who get the child tax credit can answer that one.
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  #26 (permalink)  
Old 04-15-2015, 07:47 PM
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Quote:
Originally Posted by COURTISMYLIFE View Post
My husband and I are dealing with this exact issue and heading to CC on Friday. His ex has never asked him for s.7 or daycare expenses. When we got her financials, she has received over $25,000 in tax benefits and CCTB over the past 4 years and is now wanting half of of the $16,000 in daycare and s.7 expenses from him. I too, searched exhaustively for case law but to no avail. She had been in a long term relationship with someone as soon as my husband and her separated and she never requested payment. Now that she is single she needs money. So I completely understand now the lawyers deception and cheating methods to get a settlement.
I believe that your husband is responsible for daycare if it is or was necessary for the parent to be able to work. The fact that she didn't ask for it at the time or that she was in another relationship doesn't let him off the hook - he is still responsible for his child's expenses. His lawyer should have informed him of this at the time of divorce.

Other S7 expenses (e.g. extracurriculars) are different - if his consent was not obtained prior to the expenditure being incurred, he doesn't have to pay. (Medical expenses are also different - if the S7 involves necessary medical expenses, he's responsible for his share, even if the expenses were incurred a while ago). Bear in mind that he is responsible for the post-tax cost of daycare - if his ex claimed or could have claimed them on her taxes, the benefit she received by claiming them should be subtracted from the amount she splits with your husband.

I don't believe the CCTB offsets S7 expenses. It has the word "Child Care" in the name, but it's actually a universal benefit which everyone with children of the eligible age receives, whether or not they are paying for child care. The only things that offset daycare expenses are tax benefits or subsidies which are directly tied to them, such as the tax credit for child care expenses (not the CCTB) or subsidies for daycare.

Your husband's divorce agreement should contain direction as to who receives the CCTB. Some people split it, some people direct it to the person who has primary residence with the kids.

I don't envy you trying to sort out four years of unpaid child care and S7. I strongly suggest you hire an accountant, or make a lump-sum offer to his ex to settle the matter rather than spend lots and lots and lots of money on lawyers digging up the last four years.
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  #27 (permalink)  
Old 06-09-2015, 01:57 PM
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Similar... And in middle of resolving university s7. Three years with lawyers, 20 grand in fees. Nowhere closer.

Shared custody, 50/50 for 2 youngest, oldest at uni. I pay full table as she doesn't break the floor for offset.

Ex has own business. Claims 6000 annual income. Every year. CRA does nothing. Remarried to a guy making 120 annual. My divorce order is so bad I have to go back to court to get the spousal dropped. Let's not get into why. Self represented, etc. etc. My question however is in relation to the section 7 and spousal support. When it comes to apportioning should not the spousal support be deducted from my income and added to hers? Have had various lawyers give me different answers on this and reading through the law it's not that clear to me
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  #28 (permalink)  
Old 06-09-2015, 02:07 PM
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CCTB is separate from "net cost". The ex sounds like they got tax benefits for daycare which will come off the price (ie. Full cost of daycare = $20000, tax benefits total $10,000 therefore his portion is % of 10,000. Unless she also got subsidies, then you remove that amount from total). You should demand a full disclosure of all schedules of her tax returns. That will show what she claimed and what she was entitled to.

Not sure about the spousal income amounts. You normally take what her line 150 is to calculate incomes for determination of % share. I thought you had to claim SS on your taxes? Either way, the % for uni is calculated via line 150 income. Doesnt matter what her new partner makes. Plus you consider a portion of the expense to you kid which is "normally" 1/3 but partners lawyer said its still a grey area.
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  #29 (permalink)  
Old 06-09-2015, 02:16 PM
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Well if you lol at references above it says to deduct spousal (not CS) in determined s7. Doesn't say to add it to receiving party for same purpose but yes on taxes this is what happens. I deduct she adds it to her income for taxation purposes.

Well aware new partner income matters not. Just that spousal normally ends when receiving party is self sufficient. I'd say 45 grand in support and settlement income and 120 grand from a new spouse applies. But I have to get the court to agree. I digress...

Yes the law is intentionally grey so that it perpetuates itself. As lawyers always say...'well if the parties can't agree you'll have to get in front of a judge for a ruling". Of course, at $500 an hour for the lawyer quoting this.
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  #30 (permalink)  
Old 06-09-2015, 03:11 PM
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In that case depending on what your ex does, you might want to also look at imputing an income to her. Might make s7 expense calculation much easier.
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