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

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Old 07-11-2010, 05:23 PM
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Default Separation agreement questions - shared custody, sharing CCTB/UCCB, am I being fair?

I've spent a few hours reading these forums, and would like to share my situation and hopefully get some feedback. Briefly:
  • we were married for 4½ years before separation, and have been separated for 5 months
  • we have 2 young kids, and I've had them an average of 43% of the time since I moved out
  • I've been dealing with unemployment for several months, and will be starting a new job shortly
  • my wife is unemployed and living off the government quite happily, while claiming she'll be doing in-home babysitting for the last 5 months with no start in sight
  • no child support has been paid yet (due to unemployment), and I have no plans to pay spousal support (due to length of marriage, low income, no real disadvantage to her)
  • neither of us has any money, and neither of us will be hiring a lawyer any time soon as a result
Today I gave my wife my draft of our separation agreement. I drafted it myself (no money) using an online template from a lawyer. In my opinion, it’s well-written and clear. Her reaction when I handed it to her gave me the impression that she didn't want to have to deal with it, and she may well decide to throw it in the garbage upon reading it. (To explain, she's been collecting 100% of the CCTB/UCCB, and is likely expecting larger child support payments than the offset calculations will provide.)

The separation agreement proposes shared custody with an offset calculation for child support (ie. table amount multiplied by percentage of custody of the other party), in addition to special expenses proportional to income, and sharing the CCTB/UCCB based on percentage of custody. The agreement says that each party's income will be considered as no less than $15,000, regardless of employment status (otherwise, I foresee her remaining unemployed while I pay her more money than I should). Special expenses are to be shared proportional to income, and the agreement states that more than 0.01% of annual income (per child, per year) for extra-curricular activities must be agreed upon by both of us. It states that each of us can claim one child each for “tax and financial purposes.” What happens if she decides to claim both?

With regards to sharing CCTB/UCCB, it's my understanding that the Canada Revenue Agency can send it to me 6 months of the year, and 6 months to her. Is it permissible for us to split that amount each month proportional to each other's percentage of custody? If she doesn’t agree to share the CCTB/UCCB, do I just need to apply for it, or do we have to be in agreement for the CRA to split it? Is the 43% custody that I’ve had sufficient, or would I have to have 50% custody?

With shared custody, is each of us responsible for our own child care costs, assuming we had 50/50 custody?

If she refuses to sign off on what I propose, my intention is to proceed with what I propose regardless. If I'm not able to get the CRA to split CCTB/UCCB, then I will consider my share of it towards my monthly child support payments. Actually, my share of the CCTB/UCCB would be more than my offset child support payments... she would actually owe ME money. I can deal with that (possibly by taking her to court); it's better than me owing her more money than I think is fair. I only hope she doesn't start trying to mess with custody if she doesn't get her way.

I’d like to know if I’m being fair and reasonable, and if my expectations are reasonable. I do not want to be a jerk; I’m honestly only interested in what’s fair for the both of us. If I’m out-of-line anywhere, I want to know.
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Old 07-11-2010, 08:53 PM
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Generally speaking you are correct in your statements and you did a very good thing for yourself by presenting her with the separation agreement, which represents a reasonable offer in accordance with the Family Law Act.

As far as the government benefits go, she may not continue to collect the benefits as of 90 days of your separation. You have shared custody, whether she likes it or not, and the CRA rules are clear.

The benefits will not be prorated according to incremental percentages, which is what I think you are suggesting. CRA does 100% or they do 50%, there is no in between. If you have physical custody between 40-60% then this is considered 50% shared custody. To CRA it is case closed. At the present time it will have to be a six month rotation. One of the members here had heard a rumour that they were going to go with a monthly amount, prorated to shared calculation, but there has been no public announcment of that.

For the Equivalent to Spouse credit ( it has a new name which slips my mind) that you claim on your tax return, you may each claim one child if you have more than one child. Otherwise it is acceptable to alternate years where you each claim a child. I'll mention that in my separation agreement, I added a clause where we each claimed one of our children, and then would alternate with the younger child once the eldest turned 18. You should think ahead about things like that.

You will always have the option of saying to each other, just take the credit, if it seems one of you will get much more on the return, and then split the difference. However you should lock in the alternate years in case they become unreasonable in the future.

If both of you claim the tax credit for the same child, then CRA will give it to neither of you and probably write for an explanation.

For the CCTB you simply have to apply, the form can be downloaded off of the CRA website. You may get a letter asking for some form of confirmation later. For example, a couple of months after filing this form, I got a letter asking for photocopies of the children's birth certificates. The did not contact my ex (the mother) at all. She had agreeably signed a letter that I attached to the form confirming the children's physical custody as shared. It seems to be routine for them to ask for some kind of confirmation, or possibly random and I was a random pick.

As far as spousal goes, she would have to prove entitlement, and then show need, and the amount would be based on after-tax, after benefits and after Child Support is paid. It's unlikely you would pay much anyway unless you earn substantially more than that.

Your clause about always imputing a minimum of at least $15k brought a smile to my face, and no doubt annoyed the hell out of her. Nicely worded.

IANAL, but the agreement is in accordance with the Family Law Act as far as I can read. You should have no trouble getting a court to uphold it as long as you each receive independent legal counsel and each lawyer also signs it to indicate this, and it is notarized.

One thing I missed there, with 50/50 custody, child care is considered a section 7 special expense, and it will be shared proportionate to income.
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Old 07-11-2010, 09:14 PM
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Quote:
Originally Posted by Mess View Post
Generally speaking you are correct in your statements and you did a very good thing for yourself by presenting her with the separation agreement, which represents a reasonable offer in accordance with the Family Law Act.
Thanks for your reply. She could always deny ever having seen it, I suppose. I'm curious to know what benefit this would provide.

Quote:
If both of you claim the tax credit for the same child, then CRA will give it to neither of you and probably write for an explanation.
I suppose there would be no motivation for her to do so, knowing that we would both be stuck, but it could still be a pain. Would I have any recourse, aside from writing back and explaining my position or a legal remedy?

Quote:
For the CCTB you simply have to apply, the form can be downloaded off of the CRA website. You may get a letter asking for some form of confirmation later.
I'm sort of repeating myself, but I don't know what proof I would have that she couldn't dispute. I can document my custody and my family can attest to it, but besides that, I don't know how I would go about proving shared custody if she doesn't sign the agreement.

Quote:
Your clause about always imputing a minimum of at least $15k brought a smile to my face, and no doubt annoyed the hell out of her. Nicely worded.
I actually hadn't thought of this until I read these forums. I initially had a multi-paragraph section in the agreement talking about what happens if one party is unemployed, but the $15k minimum idea reduced it to a single sentence.

Quote:
IANAL, but the agreement is in accordance with the Family Law Act as far as I can read. You should have no trouble getting a court to uphold it as long as you each receive independent legal counsel and each lawyer also signs it to indicate this, and it is notarized.
I had read this elsewhere in the forum, and I can't recall if it was from you or someone else. It was my understanding that neither of us is required to retain independent legal counsel, and that all we had to do was sign, have witnesses sign, and retain a copy with ourselves for safekeeping. Actually, one line from the agreement template that I'm using says this: "Each party has had the opportunity of obtaining independent legal counsel." Is it really necessary to get lawyers involved and have it notarized? I was planning on having an impartial third party witness the agreement, but I don't know exactly where to find one (heh), or if we require separate witnesses.
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Old 07-11-2010, 10:09 PM
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The benefit of giving her a reasonable offer would be that if the case ever goes to court (and don't say it won't, I didn't think it would 3 years before I filed my court papers either) then you have a decent chance of seeking costs if you can show that you have given her a reasonable offer. Send her a follow up email asking what she thinks of the offer you sent on such and such a date. This gives you some credibility. If you think you will reach the point where she is going to lie and deny, then you need to plan ahead now.

Regarding the CRA, she has no proof that she has full physical custody either, she has no more proof than you do. You would do yourself a favour to file with the CRA indicating the change in physical custody no matter what. If she is going to challenge you, this will bring it out in the open. If she isn't, then you know that you are still amicable about things.

If she retains the status with the CRA, and you are hovering around 40%, she can claim that for all intents and purposes she has full custody and use the CRA status to show this. If you haven't filed or challenged this, then you are indicating at least passive agreement with this. There is no reason not to file. If she challenges it, you will file a dispute yourself and probably arrange for an interview, or ask the CRA for what documentation they would prefer. If she doesn't actually have full physical custody she'd be going out on one hell of a limb to claim otherwise to the government. Some people really are this stupid. You should not be complicit in her deceiving the CRA, you should make that clear.

As far as receiving legal counsel, the law requires you both to receive indepenent counsel for the agreement to be binding. Now, there are things to think about here. The physical custody will have the force of Status Quo once the children are settled in (6 months to a year). Custody can be challenged at any time, no matter how iron clad your agreement, but you have to show a good reason to win. You are offering the table amount of support (offset) so that is what a court challenge would probably result in anyway. So your do-it-yourself agreement is not too bad, but you should really have a lawyer look it over and point out any pitfalls. You can get a half-hour free consultation through the Law Society, and then pay him for another half-hour and get him to sign off on it. There's no reason it should cost you more than a couple hundred, it's up to you if that is going to be needed insurance or not. But I'm not going to say to you "Don't see lawyer, you'll be fine" because that would just be dangerous.

If all you want is an idependent third party, look up a Notary Public in the phone book and you both go in and sign it in front of him and it will probably cost $50 or thereabouts.
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Old 07-11-2010, 10:34 PM
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Quote:
Originally Posted by Mess View Post
The benefit of giving her a reasonable offer would be that if the case ever goes to court (and don't say it won't, I didn't think it would 3 years before I filed my court papers either) then you have a decent chance of seeking costs if you can show that you have given her a reasonable offer. Send her a follow up email asking what she thinks of the offer you sent on such and such a date. This gives you some credibility. If you think you will reach the point where she is going to lie and deny, then you need to plan ahead now.
Ahh okay, thanks for explaining. The day before she told me she wanted to split, I would've told you that I knew my wife. The next day I started learning to expect the unexpected with her... I don't put anything past her. These days, I hope for the best and plan for the worst.

Quote:
If she retains the status with the CRA, and you are hovering around 40%, she can claim that for all intents and purposes she has full custody and use the CRA status to show this. If you haven't filed or challenged this, then you are indicating at least passive agreement with this. There is no reason not to file.
Got it. She just found out about my intentions today, so I don't want to call CRA tomorrow and ask them to split CCTB/UCCB. Is there any problem with me waiting until next month? Also, who gets the first 6 months, the person notifying CRA?

Quote:
As far as receiving legal counsel, the law requires you both to receive indepenent counsel for the agreement to be binding.
I was not aware of that. That's a shame. Well, I figure with the way everything is laid out, I'm at a financial advantage regardless of whether or not she agrees to the separation agreement. I'll proceed as usual, give her cheques each month for what I calculate that I owe, and if she has a problem with it, I'll let her initiate legal proceedings. I'm doing what I can to ensure that I'm doing everything "right," without having to spend money that I don't have. Worst-case scenario, I pay full table amount, but I don't see that happening. My primary concern at that point would be custody... perhaps I'll take a walk over the to custody forum.

Oh, any idea about the child care question from my first post? If she puts the children in child care while I have 43% custody, am I on the hook for any of her child care costs? I would think that I would be to some extent, and if I had to guess, it would be for 14% of her costs (57% - 43% = 14%).

Oh (again), and to further complicate things, if she does miraculously start doing at-home babysitting, am I going to be on the hook to pay her for babysitting our own kids?
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Old 07-12-2010, 01:07 AM
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OK, no she can't charge babysitting for her own children.

I mentioned it earlier, but there was a lot, child care is a section 7 expense. It gets split proportionate to income. So if you make 30k and she makes 20k, you split it 60/40 (you paying the 60%.)

If I were you, I wouldn't push things quite so fast with the separation agreement, as long as you are settling in with your kids. She could go to a lawyer tomorrow, decide she is better off financially if she gets and extra 5% time, and start fighting you over it. After about 6 months or so, you have a status quo situation and it's unlikely the courts would change things if the kids are settled in and happy. So if I were you I would give her the offset table amount, don't fuss with her about the Tables or the custody %.

In the meantime, make sure if they are sick on your days, you take days off work to care for them. Take them to doctor/dentist checkups, if your ex goes to the doctor with them, go along. Make sure you are taking them to daycare/school/recreational activities. For example take them to swimming lessons and make sure the instructor knows you by name, etc. If she challenges you, you want to make sure you show you are fully involved as a parent and that you share things like that (or even that you do the bulk of it.) Moreover, this isn't just for arguing custody, you want to be an involved parent for the sake of being an involved parent.

Make sure you are looking into things like future schooling, what neighbourhood you will be in, etc. Have a plan. Think about the future. Know what resources are available, what daycares (even if she ends up providing care.) If she does provide childcare, make sure this doesn't cut into your custody time.
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Old 07-12-2010, 01:18 AM
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Quote:
Originally Posted by Mess View Post
I mentioned it earlier, but there was a lot, child care is a section 7 expense. It gets split proportionate to income. So if you make 30k and she makes 20k, you split it 60/40 (you paying the 60%.)
Ah okay, so it doesn't even matter whose custody the kids are in when they're in day care. I didn't realize it was also considered a special expense.

Quote:
If I were you, I wouldn't push things quite so fast with the separation agreement, as long as you are settling in with your kids. She could go to a lawyer tomorrow, decide she is better off financially if she gets and extra 5% time, and start fighting you over it. After about 6 months or so, you have a status quo situation and it's unlikely the courts would change things if the kids are settled in and happy. So if I were you I would give her the offset table amount, don't fuss with her about the Tables or the custody %.
When we first separated, I received some initial advice to have a separation agreement signed as soon as possible, but it now looks like that wasn't very good advice. I haven't really pushed it, I've just suggested it would ideal to have it signed at the end of the month. I'm learning a lot today. I wasn't even aware of status quo beforehand. The custody % actually works in her favor, so I'd expect she would want to do it that way.

The CCTB/UCCB thing could certainly push her, but I don't expect her to suddenly start messing with custody. I'm in no way trying to push her for the sake of causing her grief. Based on what you know, do you believe I'm still better off applying for shared CCTB/UCCB at this juncture?

Quote:
In the meantime, make sure if they are sick on your days, you take days off work to care for them. Take them to doctor/dentist checkups, if your ex goes to the doctor with them, go along. Make sure you are taking them to daycare/school/recreational activities. For example take them to swimming lessons and make sure the instructor knows you by name, etc. If she challenges you, you want to make sure you show you are fully involved as a parent and that you share things like that (or even that you do the bulk of it.) Moreover, this isn't just for arguing custody, you want to be an involved parent for the sake of being an involved parent.
I totally agree, and I have been involved with all appointments to date.

Quote:
Make sure you are looking into things like future schooling, what neighbourhood you will be in, etc. Have a plan. Think about the future. Know what resources are available, what daycares (even if she ends up providing care.) If she does provide childcare, make sure this doesn't cut into your custody time.
I neglected to mention in my first post that we're currently not living in the same city. Once a week I drive 1½ hours to pick the kids up for 3 full days, and then 1½ hours back to drop them off (I haven't balked at doing 100% of the driving, as it's more important that I get to have that time with my kids). It's a long story as to why I live 1½ hours away at the moment, but it's my full intention to move within range of their mother before they start school next year. Now that I've found employment again, I'll be able to start forming a plan, but it feels like I've been living month-to-month for a while, not knowing what was going to happen.

Thanks again for your input!
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Old 07-12-2010, 12:06 PM
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Finally had an [email] discussion about the separation agreement, or a part of it anyway. STBX is not keen on the notion of sharing the CCTB/UCCB, surprise to no one, and as a result doesn't want to sign (also surprise to no one). But hopefully she'll be more inclined to discuss it now.

I've advised her that I'll allow her to continue collecting 100% of the CCTB/UCCB until September, in the interest of allowing her to find work (she'll have had 7 months by that point). My child support payments will come out of what would normally be my portion. After that, I'll request the CRA split it, and I'm sure she'll be very unhappy at that point, especially with the offset child support and my considering her income as a minimum of $15,000, which I think is reasonable after 7 months.
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Old 07-12-2010, 12:52 PM
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I would stop mentioning 43%, and implement and state all of your intentions and agreement to be 50/50 shared custody. Officially stating and implementing anything else does not put you on equal ground with her psychologically in everyone's eyes (hers, the kids, the court system, etc), even if it is over the 'magic' 40%. Go 50/50!
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Old 07-12-2010, 12:56 PM
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The agreement doesn't state that I've had 43% custody up to this point, but it does mention how percentage of custody should factor in with calculations. You believe I should remove even that, and simply state that everything will be 50/50?

I'll know my work schedule shortly, and once I do, I intend to try to work out an arrangement as close to 50/50 as possible. We'll see how that goes. I think it would otherwise not be a problem with her, but now that she sees that she won't be getting as much money as she thought, it's hard to say.
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