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  • rockscan
    replied
    Originally posted by noteasy View Post

    At the end of the year you pay the same amount of tax. Period.
    No you have paid tax on your weekly pay cheques at a certain rate calculated by your income from that source.

    At the end of the year your total income from all sources goes through the calculations and the income tax you paid weekly is subtracted from the tax owing. It's right at the top of page 4 of the tax form.

    Here are 3 solutions people of moderate intelligence can employ to avoid this perceived shortfall:
    -Ask their work to take more taxes of their check
    -Pay the CRA in installments as the year progresses.
    -figure out how much tax extra tax per paycheck they will have to pay at the end of the year and put that money in the bank each paycheck.
    1 is true. 2 is stupid. 3 is something people should do anyways except it's save for any unexpected outcomes. You can also open an RRSP, donate to charity, get some education claim things like property tax, medical expenses and transportation credits.

    On top of that there are dependent credits (if you do the CS right) and other tax credits related to children that can be applied to greatly offset the amount owing at the end of the year.
    Only if entitled!

    It is absurd (even offensive) that people are advising others to earn less so they don't have to pay as much child support, imply they pay a different amount of tax or that they will end up earning no extra money after taxes and child support increase.
    Well technically if you don't want to pay more cs then no you shouldn't earn more money. You earn more you pay more and since there was an argument about how unfair things are, why create more issues?

    Leave a comment:


  • noteasy
    replied
    Originally posted by blinkandimgone View Post

    Except that you don't. You'd pay tax based on 25k earnings at each job, not the higher tax rate you owe for one single 50k job. Neither job is privy to the amount of taxes you get deducted at the other job so you would need to make a point of asking either one job to take off substantially more tax deductions, or both jobs to take off more tax deductions. Without doing this, you've paid the tax rate for a 25k earner across the year and owe taxes at the end of the year.

    Marginal tax rate on a 50k job is 35% ($17,500) vs 25% ($6250) on a 25k job. Paying 25% on a combined total of 50k ($12,500) leaves you with a shortfall and OWING money at the end of the year, not getting it back. It's basic math.
    At the end of the year you pay the same amount of tax. Period. Here are 3 solutions people of moderate intelligence can employ to avoid this perceived shortfall:
    -Ask their work to take more taxes of their check
    -Pay the CRA in installments as the year progresses.
    -figure out how much tax extra tax per paycheck they will have to pay at the end of the year and put that money in the bank each paycheck.

    On top of that there are dependent credits (if you do the CS right) and other tax credits related to children that can be applied to greatly offset the amount owing at the end of the year.
    It isn't like this is the OPs first rodeo.

    It is absurd (even offensive) that people are advising others to earn less so they don't have to pay as much child support, imply they pay a different amount of tax or that they will end up earning no extra money after taxes and child support increase.

    The only relevant factor or danger that may or may not be a factor to consider is "if I quit this extra part-time gig will a judge impute an extra income on me" but so far no one has posted case law on that. Knowing is so much better than guessing.

    OP what do you think?

    Leave a comment:


  • blinkandimgone
    replied
    Originally posted by noteasy View Post
    The money comes back at the end of the tax year.
    If I had 1 job that paid 50K I would pay the same tax rate as someone that had 2 jobs paying 50K.

    In the past I have asked that I not be taxed on my paycheck because I would be getting it back anyways. I signed a piece of paper for the accountant and I was all good.
    Having 2 jobs shows a lot of character but the stress levels alone would have me say to avoid it but people do what they need to.
    Except that you don't. You'd pay tax based on 25k earnings at each job, not the higher tax rate you owe for one single 50k job. Neither job is privy to the amount of taxes you get deducted at the other job so you would need to make a point of asking either one job to take off substantially more tax deductions, or both jobs to take off more tax deductions. Without doing this, you've paid the tax rate for a 25k earner across the year and owe taxes at the end of the year.

    Marginal tax rate on a 50k job is 35% ($17,500) vs 25% ($6250) on a 25k job. Paying 25% on a combined total of 50k ($12,500) leaves you with a shortfall and OWING money at the end of the year, not getting it back. It's basic math.

    Leave a comment:


  • rockscan
    replied
    I've worked a full time job and a part time job both with regular rates and added tax off the second job. It does not come back in scenario one. You pay extra tax as your TOTAL gross income is considered. With two jobs you do not have the proper rate of tax for both of them combined. I lived it, I paid tax on it at the end of the year, I did not get anything back.

    Leave a comment:


  • noteasy
    replied
    The money comes back at the end of the tax year.
    If I had 1 job that paid 50K I would pay the same tax rate as someone that had 2 jobs paying 50K.

    In the past I have asked that I not be taxed on my paycheck because I would be getting it back anyways. I signed a piece of paper for the accountant and I was all good.
    Having 2 jobs shows a lot of character but the stress levels alone would have me say to avoid it but people do what they need to.

    Leave a comment:


  • rockscan
    replied
    Actually, getting a second job without proper tax shelters in place is a bad idea come tax time for anyone. Having two jobs without extra tax taken off means more money in May. How do I know? Because I worked in accounting and learned the reasoning behind tax rates for one single job are not enough to cover two.

    For those paying support, it is worse because you never really see that money and you end up paying support based on it. The guidelines don't take into account the net income and you are basically running on a hamster wheel for no reason. Don't get a second job if you have a full time one to make cs payments.

    Leave a comment:


  • noteasy
    replied
    Originally posted by blinkandimgone View Post
    You don't get a second job specifically to manage child support payments. The income from that job will be included and increase your child support amount, defeating the purpose of the second job. There are more effective ways to manage.
    Definitely disagree on that one. The poster gets "taxed" the CS rate but they still take home money. What other ways are there to manage? Under the table jobs and income are options for many but other than that I know of none.

    Originally posted by blinkandimgone View Post
    And yes, if historically you made Xx amount having to jobs and pay support on the total amount, then quit one job and attempt to reduce CS, you can be on the hook for the full amount.
    Definitely looking up caselaw on this would be good.
    Going from 55 hours to 40 hours by quitting an extra job is not exactly being "underemployed".
    It would be draconian, the law is sometimes that.

    Leave a comment:


  • blinkandimgone
    replied
    You don't get a second job specifically to manage child support payments. The income from that job will be included and increase your child support amount, defeating the purpose of the second job. There are more effective ways to manage.

    And yes, if historically you made Xx amount having to jobs and pay support on the total amount, then quit one job and attempt to reduce CS, you can be on the hook for the full amount.

    Leave a comment:


  • noteasy
    replied
    Originally posted by rockscan View Post
    The part time job contributed to your cs amounts. Never get a second job as it has an impact. With 50/50 you will have offset. Just quit the pt job and adjust cs accordingly. It may be tight for a few years (and I say this as the wife of a man who paid full table on EI) but you will get through it.
    If offset amounts are paid it will dictate who gets to collect the $13K tax deduction for eligible spouse.
    It is best each pay each other child support and NOT an offset amount unless one side is willing to give up with significant credit.

    I also don't understand "never get a second job" earning more income is a personal choice not getting one in spite. Kind of like turn down work promotions because your ex will get some of the money. Maybe both parents are doing that and making for a worse situation for everyone.
    Maybe you mean don't get a second PT job because if you quit it you will be imputed an income? (I don't think that would happen but I don't know).

    Leave a comment:


  • guydeluxe2018
    replied
    Thank you to everyone and your input is valued. Good news I just the order stating on the interim starting June 01,2023 we will be having 50/50

    Leave a comment:


  • rockscan
    replied
    The part time job contributed to your cs amounts. Never get a second job as it has an impact. With 50/50 you will have offset. Just quit the pt job and adjust cs accordingly. It may be tight for a few years (and I say this as the wife of a man who paid full table on EI) but you will get through it.

    Leave a comment:


  • guydeluxe2018
    replied
    I have a full-time job and to supplement income I got a part time job. The reduced hours are at part time and it is affecting my finances and full time job alone is not enough to cover child support and bills

    Leave a comment:


  • blinkandimgone
    replied
    The solution to having reduced hours is child care, which falls under section 7 expenses when it's used to facilitate the parents working.

    This allows you to have your full income to support the child, and not impact your parenting time. No idea how old your child is, but there are tonnes of resources for childcare, either privately or EDP through the schools. Find out what your options are and include daycare as a section 7 expense in your mediation.

    Leave a comment:


  • noteasy
    replied
    The question will be why you are not working and the solution for child support will likely be to impute an income upon you of at least minimum wage for the purposes of support.

    Your whole situation as far as child care goes is unknown.
    start building those supports so that someone is caring for the child before and after school while you work.

    Don’t rely on your ex. If your ex is caring for the child more hours than you and those hours add up to more than 60/40 split then she will not have to pay you child support.

    rught now at 50/50 you both contribute to child support. Make sure you each pay each other the monthly amount. Try to avoid offset amounts and so allow each other to collect tax credits for the child. You collect one year, she collects the other.

    the ex works?

    Leave a comment:


  • guydeluxe2018
    replied
    I filed on consent and she didn't dispute that starting in June it will be 50/50.

    Leave a comment:

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