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Divorce & Family Law This forum is for discussing any of the legal issues involved in your divorce.

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  #1  
Old 04-30-2012, 03:07 PM
whatwasithinking whatwasithinking is offline
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Default Section 7.3 - net of NRTC's and CCTB?

My question involves child support in British Columbia, Canada

Hello,
I'm wondering if anyone might know how to handle Section 7.3 of the support guidelines? I understand it to be that tax credits and benefits should be deducted from what the NCP contributes to extraordinary expenses? I already pay my ex more than the guideline, am heavily involved in my children's lives, do not ask for her to contribute to my Section 7 expenses, and she's taking me to court to pay Section 7 expenses she's never requested reimbursment or provided receipts for. And she earns double my income!
I've had enough and doing some research now. On her tax return (2009, just for an example) she deducts 10,320 for eligible dependants, 4,178 for 2 children born later than 1992, and 2,931 in medical expenses (not sure how much of this is related to the children). The total of her non refundable tax credits is multiplied by 15% to get to her deductable amount (I'm not sure why? Is only 15% of NRTC's deductable?). So my question is, should I be reducing my contribution to Section 7 expenses to offset the tax relief she receives? How would this calculation work?
She also receives the Child Tax Benefit, on this 2009 return it shows the 2010 estimated benefit to be $675. This is cash into her pocket right? Am I allowed to deduct from my Section 7 contribution?
I would so appreciate any help on this, I know it's very complex but I'm hoping someone knows what I'm talking about! Help!!

Thank you :-)
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Old 04-30-2012, 10:54 PM
dinkyface dinkyface is offline
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I think there has to be some link between the section 7 expense and the tax credit/deduction.

e.g. for childcare expenses - this relates to CCTB (CHILDCARE tax benefit), and the tax reduction resulting from claiming daycare expenses on her tax (i.e. the marginal tax rate applied to the expense amount)

e.g. for medical expenses - this relates to the tax reduction resulting from claiming medical expenses (these have to be pretty significant in relation to income to generate much tax felief)

e.g. for music/sport lessons - this relates to the 15% credit for arts/sports programs (up to 15% of $500 per child per year).

Being able to claim kids as dependents does not relate to any specific expenses that fall under section 7.
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Old 04-30-2012, 10:58 PM
whatwasithinking whatwasithinking is offline
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Thanks Dinkyface (I feel a little weird calling you that ;-)), I appreciate the response. Your comments make sense. Just playing devil's advocate regarding the dependants deduction, doesn't it make sense we should share in the deduction? Particularly because I'm already paying taxes on CS and she doesn't?

Any thoughts on where the Child Tax Benefit falls in here?

Thank you!
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Old 04-30-2012, 11:00 PM
whatwasithinking whatwasithinking is offline
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Oh, and I'm not familiar with the 15% credit for arts/sports. Could you elaborate?
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Old 05-01-2012, 12:36 AM
dinkyface dinkyface is offline
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Apologies for confusing CCTB and UCCB - and also did a check of the Child Support Guidelines here http://laws-lois.justice.gc.ca/eng/r.../FullText.html

  • Subsidies, tax deductions, etc.

    (3) Subject to subsection (4), in determining the amount of an expense referred to in subsection (1), the court must take into account any subsidies, benefits or income tax deductions or credits relating to the expense, and any eligibility to claim a subsidy, benefit or income tax deduction or credit relating to the expense.
  • Marginal note:Universal child care benefit

    (4) In determining the amount of an expense referred to in subsection (1), the court shall not take into account any universal child care benefit or any eligibility to claim that benefit.

Last edited by dinkyface; 05-01-2012 at 12:46 AM.
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Old 05-01-2012, 01:06 AM
whatwasithinking whatwasithinking is offline
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Thanks again for a reply. This is precisely where my question comes into play, your section (3) noted above. The tax deductions (non refundable tax credit) and benefit (Child Tax Benefit), do not specifically relate to an expense of the children, so I don't know if this section applies? And yes, I'm not inquiring about the UCCB at all, our children are of the age that they don't require childcare. Thanks Dinkyface!
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Old 05-01-2012, 12:34 PM
dinkyface dinkyface is offline
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Some info about the arts tax credit
Newsroom - Tax tips - Children's arts tax credit

And the similar fitness tax credit
Line 365 - Children's fitness amount
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cctb, child support, extraordinary expense, nrtc, section 7


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