Separation agreement

[caro46]

Hi
I am in the process of re-negociating our separation agreement and would like some input from anyone of experience...

The original agreement was to share expenses 50-50 except for:

I buy the kids clothing (3 kids)
He buys the school supplies
I get child tax benefit

He pays the table amount of child support (offset amount)

I turned down spousal support

We shared the contents of the house and he payed me my share of the house (we both agreed on this no problems)

This agreement was working fine until he decided he wanted to change the amount of child support or get the child tax benefit. As per the CRA he was entitled to CCTB so applied and got it. Now I wanted to share expenses for the kids clothes, activities and special expenses in proportion to our salaries. He refused and told me I would have to bring him to court... We originally went to court but were told to go to Mediation which we tried and it did not work as he is verbally abusive and I couldn't say anything at Mediation...
If I could afford to keep going this way (keep the present agreement)
I would to save the time and energy but the problem is that I cannot offer the children the same standards of living he can. He makes over 20 000$ more than I a year and also has his mom living with him and helping with his costs.

My Lawyer and I are filing the court documents and I just want to make sure that I get a fair agreement in the end. I don't want endless court procedures, just what the kids and I to get what were entitled to and nothing more.

Originally I never even thought about Pension, RRSP etc... I was told I should ask for my share as I was technically paying into it (RRSP & Pension) during our relationship...

This is all so confusing and I feel like one of those crazy ex-wifes who want revenge...

How can I find a good example of a fair separation agreement?
Thanks

[NBDad]

I get child tax benefit

THAT is unenforceable and the attorney that allowed that in or allowed you to sign an agreement with that in there needs his head examined and his ass kicked. CCTB is legislated by the Income Tax act and is outside the jurisdiction of family court. Any lawyer with a brain should know that.

How long has the agreement been in effect?

How long have you been separated?

Have you recalculated the CS owed each year based on the respective Notice of Assessments? Does your agreement have that provision in it?

Were you common law or married?

The CS should be paid depending on the amount of time the kids are with him. If he has them more than 40% of the time (equivalent to 3 overnights in 7) then you would typically use the offset amount. He'd have to have them at least that much to meet the CRA's criteria. If he has them that much he pays offset CS and is entitled to the CCTB 6 months a year.

20,000 isn't that much more after you consider tax brackets and whatnot. You probably don't qualify for spousal if that's the difference in income, as you'd use the "with children" component which accounts for CS paid/received.

A "fair" separation agreement is in the eye of the holder. For special expenses a proportional split is pretty standard. He voided the agreement when he went after the CCTB (even though you were supposed to inform the CRA of the new arrangements anyway, what you did is TECHNICALLY fraud).

School supplies are usually covered by CS. Clothes are covered by CS. New winter gear could be debatable, but would typically fall under clothing and thusly CS.

Definitely agree that you should address RRSP/Etc if you haven't already. It's called equalization, your attorney should have addressed that during the separation agreement. (NOTE: This can change depending if you were married or common law and depending on the province you live in.)

[caro46]

We were common law for 12 yrs and have been separated for 3 years this past May and the agreement has been 3 years in June.

We haven't re-calculated the CS every year as I was trying to keep peace with him which has been very difficult...
when my lawyer asked for financial disclosure I saw that his salary has increased abour 5% for the past 2 yrs so maybe a little increase in child support but nothing worth fighting over.
About the CCTB I agree with you that the lawyer (acting as a mediator) should have known since I found that out on my own when I went looking for a form to share the CCBT... As soon as I found that out I told my ex and he applied and got it... I have spoken to 2 other lawyers since the beginning of these procedures and I was the one to find out on my own.... lol
This is why I am now trying to inform myself as much as possible!

About RRSP and Pension (he works for the federal gov.), It was never adressed in the agreement, so is it too late to ask for it now?

One more question; he threatened to claim undue hardship if I pursued the issue. The grounds being that his partner just moved out... Is that a sufficiant reason considering that when we did our agreement he lived on his own? Also can he claim that just after coming back from a 1 month long vacation in Europe?
Thanks!

[NBDad]

Undue hardship...as the father....

Excuse me for one second...

HAHHAHAHAHAHAHAHHAHAHAHHHAHHA

*cough* Now....undue hardship is nearly impossible to pull off, he's blowing smoke out his ass. The standard of living has to be DRASTICALLY DIFFERENT between the households for it to apply. It's not, since he just started receiving the CCTB.

[caro46]

LOL... Thanks for that... and by the way, he doesn't get much CCTB (63$/month) because of his salary... I on the other hand just lost 450$ a month (I do realize I wasn't supposed to get it but still...need to adjust my budget slightly) So maybe I should claim undue hardship?

[billm]

...
School supplies are usually covered by CS. Clothes are covered by CS. New winter gear could be debatable, but would typically fall under clothing and thusly CS.
...

and given that you use the offset method (ie each pay each other CS) and take care of the kids equally, these expenses should be shared 50/50, either by receipt sharing, or by both spending the same amount.

[caro46]

Billm; Shouldn`t these expenses be proportionnate to our income?

[caro46]

A "fair" separation agreement is in the eye of the holder.

Sorry but I don`t understand this... Language barrier (french first...)

[dinkyface]

Billm; Shouldn`t these expenses be proportionnate to our income?

Because he pays you CS (offset method), the 50% you agreed to pay is partially subsidized by him. So in effect, it IS proportional to income. Not sure how the exact numbers work out though.

The Child Tax Credit situation is unfortunate, and it sucks that he did this (given that the lower earner gets so much more benefit from it), but your current CS situation seems to be fair (in the eyes of the system, as I understand it).

Also, the CS system is not designed to ensure that you both offer the same standard of living to your kids. If you earn less, then your S.O.L. will be less.

I agree that you should look into the RRSP/pension splitting ... but also note that he can go after YOUR RRSP/pension also, and that the amount to be split is limited to what accrued during that 12 years. So think about how much is actually at stake (after lawyer fees). Were there any other savings/debts that should have been split?

[Mess]

LOL... Thanks for that... and by the way, he doesn't get much CCTB (63$/month) because of his salary... I on the other hand just lost 450$ a month (I do realize I wasn't supposed to get it but still...need to adjust my budget slightly) So maybe I should claim undue hardship?

It's good you acknowledge you weren't supposed to be getting it. You didn't lose $450 per month, you were never supposed to get that much to begin with.

Undue hardship has nothing to do with CCTB so don't connect the two. Undue hardship is a technical legal concept and you need to show specific things.

If you are carrying a large debt; you can show (not just claim) that the debt was necessary to support the family; this means both of you were spending all of your salaries on the family and needed to take on debt on top of that. It doesn't work if you spent your working salary on cabs and restaurants and then put the rent and groceries on credit card. This is the basic scenario for undue hardship, if the weight of the debt is on your side and there were no assets available to pay it off.

Then you have to show that currently your standard of living is far below the other household. Again, show proof, not just claim. Undue hardship is very rarely accepted in court, it is not meant as something that every couple is going to claim, just very specific extreme circumstance.

[LakeErie]

THAT is unenforceable and the attorney that allowed that in or allowed you to sign an agreement with that in there needs his head examined and his ass kicked. CCTB is legislated by the Income Tax act and is outside the jurisdiction of family court. Any lawyer with a brain should know that.

....

The CS should be paid depending on the amount of time the kids are with him. If he has them more than 40% of the time (equivalent to 3 overnights in 7) then you would typically use the offset amount. He'd have to have them at least that much to meet the CRA's criteria. If he has them that much he pays offset CS and is entitled to the CCTB 6 months a year.

I have some questions on these Tax issues such as CCTB and the universal childcare benefit etc that are federally regulated for shared custody situations:

1. Can we or will the court approve the 6 months rotations for CCTB and Universal Child Care Benefit if we write it in a divorce / custody agreement for a 50/50 shared custody? I think I have definitely seen examples in CanLii.

2. In 50/50 shared custody, can a couple also write in the judgment that they should claim the child as dependent in alternatively years (such as odd years by Mom, even-numbered Tax years by Dad)? Often times because of income difference one party has to pay the other CS, but CRA wouldn't allow the Dad to claim the child as dependent if Mom doesn't agree. We know technically actually both parents pay each other CS in shared custody, one party pays the other only because their salaries are not equal.

3. If Mom in certain years claim the child as dependent, but Dad still has a 3~4K childcare expense for childcare, how will this be handled when filing a tax return? I think this might have been discussed before, but I couldn't find that post. I think if one parent pays for Childcare, s/he should be allowed to claim that expense regardless of who claims the child as dependent.

Anyone has any experience?

[LakeErie]

LOL... Thanks for that... and by the way, he doesn't get much CCTB (63$/month) because of his salary... I on the other hand just lost 450$ a month (I do realize I wasn't supposed to get it but still...need to adjust my budget slightly) So maybe I should claim undue hardship?

How many kids do you have? Suppose if you have two, to get $63/month CCTB your ex should at least earn a salary > $80K. Or maybe he has since re-married so his new family income from both spouses are taken into consideration.

If you earn $20K less than him, that is $60K or let's say $50K, you won't get $450/month. I think something is not right here.

[billm]

Billm; Shouldn`t these expenses be proportionnate to our income?

CS is designed to cover those expenses.

When you use the offset method of CS, you have already equaled the CS money in each household, so you should share expenses covered by CS 50/50, and subsequently this IS sharing expenses proportionate to income.

Medical, dental, and other section 7 expenses should be shared according to income (after considering tax benefits etc)

Also note that the offset method assumes it costs TWICE as much to raise the child in two homes as opposed to one, which is obviously not true. This means the higher income earner is disadvantaged by the offset method, but lawyers and judges ain't very good at the math!

[caro46]

I agree that you should look into the RRSP/pension splitting ... but also note that he can go after YOUR RRSP/pension also, and that the amount to be split is limited to what accrued during that 12 years. So think about how much is actually at stake (after lawyer fees). Were there any other savings/debts that should have been split?[/quote]

I had to take out my RRSP the year before to pay for University as he didn't want me to use the "family" money... as for the savings, when I saw the financial statements for the year before the separation (he was re-assessed after the agreement was signed) There were amounts he neglected to declare and they came from saving bonds I didn't know he had!

[caro46]

1. Can we or will the court approve the 6 months rotations for CCTB and Universal Child Care Benefit if we write it in a divorce / custody agreement for a 50/50 shared custody? I think I have definitely seen examples in CanLii.

Beginning this year, each parent gets half of the CCBT for 12 months of the year