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CCB As Income or Taken off Tax Deductible Expenses?

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  • CCB As Income or Taken off Tax Deductible Expenses?

    Hello,

    I was wondering if anyone could tell me how the CCB in Ontario is applied when looking at the split of sec 7 expenses.

    My partner's ex gets $502 monthly for CCB (he allowed her to keep the benefit regardless of shared custody and doesn't claim it).

    The children's special expenses that are tax deductible would be before and after day care, March break camps and Summer camps.

    Can anyone tell me if the CCB is looked at as income when determining the proportionate share of the expenses or is it taken off the total of tax deductible expenses such as day care considering it's a benefit?

    I know that in the past, the UCCB was not looked at when determining expenses but that changed when the CCB came into place in 2016 as tax free.

    The lines are muddy when I look at the guidelines so I'm wondering if anyone has encountered this and how it was taken into account?

    Thank you!

  • #2
    The child benefit would be addressed in their agreement. If they had shared custody with an offset agreement, there should have been a clause placed in the agreement that one parent claims in even years, other parent in odd. If that wasn’t determined or added then she gets it and thats it.

    It does not affect the net cost of the activities. Tax benefits are applied to those things. Which means whatever tax benefits she gets should be subtracted. If your man does not have a lawyer with access to divorcemate, he will need to do a fake tax return with the expenses in and then out to see what she gets. Subtract that amount and calculate proportionate share.

    Remember too that that amount goes into her income when considering costs that she would argue are section 7 like pizza days or $25 school trips etc. When a parent says something is s7 you look at their income plus their cs plus any ccb and determine if it would be s7. Some expenses aren’t s7 as a result. Like $60 summer soccer etc.

    Comment


    • #3
      Originally posted by rockscan View Post
      The child benefit would be addressed in their agreement. If they had shared custody with an offset agreement, there should have been a clause placed in the agreement that one parent claims in even years, other parent in odd. If that wasn’t determined or added then she gets it and thats it.

      It does not affect the net cost of the activities. Tax benefits are applied to those things. Which means whatever tax benefits she gets should be subtracted. If your man does not have a lawyer with access to divorcemate, he will need to do a fake tax return with the expenses in and then out to see what she gets. Subtract that amount and calculate proportionate share.

      Remember too that that amount goes into her income when considering costs that she would argue are section 7 like pizza days or $25 school trips etc. When a parent says something is s7 you look at their income plus their cs plus any ccb and determine if it would be s7. Some expenses aren’t s7 as a result. Like $60 summer soccer etc.
      Sorry, I wasn't asking if he was entitled to the benefit. Their agreement says she is entitled to it but I think you've still answered my question.

      I'm essentially if the ccb is considered income when calculating my partner's share of the expense and I think you're saying yes, it is part of her income.

      My second question is, it sounds like all day care is tax deductible meaning she could be getting approx. %35 back annually. Is the tax return she gets yearly for day care taken off the total of what each of them owe? They would split the balance AFTER the deduction is taken off, right?


      His lawyer does have access to it. Can we ask his lawyer to request her detailed income tax returns in order to see what portion she got back was related to the special expenses she's now claiming he owes retro on half of(before deduction is taken off)?

      Thanks for your help!!

      Comment


      • #4
        If you know the monthly cost of day care your lawyer can just put in the annual cost and tell you what his share is. If you are going to do it that way, make a list of all the potential expenses. Are they in camp? S7. Are they in sports? S7. Do they have medical expenses? S7. Do they have tutors? S7. So take all those amounts, add them up and have the lawyer plug them in to the software. All they need are the incomes of both parties (her line 150 plus) and the total costs. That will pump out the amount he pays.

        For example, my partner has post secondary. The program takes his income, his ex’s income, calculates the tax benefit and spits out what his monthly cost is for annual school expenses.

        With respect to what IS a s7. Thats where all the money she gets comes in. If she earns 40,000 and gets 12,000 in cs and then 2,000 for ccb, her annual income is 54,000 which means $100 for a sport may not be a s7 expense. Conversely, if that total “income” was say $25,000 and dad made $100,000+, $100 may be a s7.

        Im not a lawyer though and this is just my observation from cases I read. The bottom line is the baby bonus means nothing when it comes to this shit.

        Comment


        • #5
          It does mean something if it counts as income on her end. I know you're saying that it isn't counted towards the expenses on it's own but if it's looked at as income, that helps my partner's case as well in terms of his share.

          If you're saying her income will be looked at as inclusive of all three CS/CCB and salary, she makes more than him a year.

          I'm asking (somewhat separately of the above question) if at the end of the tax year, she receives a tax return on tax deductible expenses such as day care and camp costs (which she's eligible to 35% of return on up to the max amount she claimed which she's NEVER mentioned) will that tax return be taken off the total amount of day care costs for the year and they split the balance in
          proportion to their incomes?

          Say we ask for her detailed income tax return and it says she got "XYZ" taken off tax deductible child care costs....will that be removed from the total owing from my partner?

          Hopefully I'm making sense. I tend not to!

          Comment


          • #6
            CCB As Income or Taken off Tax Deductible Expenses?

            No it doesn’t count as income for the cost. Its only looked at for cases where section 7s are demanded when they aren’t section 7. Theres a line I read where it was something like considering the incomes of both parents and cs paid and any bonuses or benefits.

            With respect to retro expenses...did he pay his proportionate share of the FULL cost and shes now saying he owes her more? Did his income change?

            The only thing you would need to know is if she got any subsidies. Say If she gets a subsidy for daycare and didnt tell him, that is supposed to come off.

            If you know her income and the costs you can go into an online tax program (i think turbo tax does it basic?) and calculate it or just go to your lawyer to calculate it.

            ETA: is she requesting retro expenses she didn’t ask for? Like sports activities he knew nothing about?

            Comment


            • #7
              I should also note that my partners share of the expense is 35% as well. His ex is claiming tax deductions should NOT be taken off because she doesn’t claim them. We will hear from the judge in another month on that.

              Comment


              • #8
                Originally posted by rockscan View Post
                No it doesn’t count as income for the cost. Its only looked at for cases where section 7s are demanded when they aren’t section 7. Theres a line I read where it was something like considering the incomes of both parents and cs paid and any bonuses or benefits.

                With respect to retro expenses...did he pay his proportionate share of the FULL cost and shes now saying he owes her more? Did his income change?

                The only thing you would need to know is if she got any subsidies. Say If she gets a subsidy for daycare and didnt tell him, that is supposed to come off.

                If you know her income and the costs you can go into an online tax program (i think turbo tax does it basic?) and calculate it or just go to your lawyer to calculate it.

                ETA: is she requesting retro expenses she didn’t ask for? Like sports activities he knew nothing about?


                Essentially the problem is up until recently, she was just accepting $200 dollars a month on top of the $1000 he agreed to pay her (not table, not offset even though he has them 43% percent) in their agreement in 2016. He got guilted and regrets it now but...a bad deal is still a deal.

                The problem is now that he's motioned to pay off set as well as get them half the time (which she verbally promised and didn't follow through with when she moved), she's turning around and saying he owes more than the $200 she verbally agreed would suffice.

                The issue is, she was spending the money without sending him receipts or any communication on the actual costs associated. It was both their bads to agree to $200 being enough and that she'd do all the paying up front.

                Now she's turning around and saying he didn't pay his share as laid out in the agreement but NEVER consulted with him on costs first as their way of doing things wasn't an issue until he motioned for the off set and 5050.

                Now he's trying to determine what she could say he owes with the support he gives, the contribution of his $200 and her tax returns on day care.

                We're waiting on receipts now but if she didn't share this information along the way and didn't ask (also specified they needed to agree on expenses in their agreement) can she screw him and ask for this?

                Family court is true birth control for me......

                Comment


                • #9
                  Your husbands situation is special because they agreed to a lower than table amount. How a judge will see that is a crapshoot.

                  I don’t know what your lawyer recommended but if it was me I would do this:

                  1. Demand receipts for daycare and any summer camp expenses (camp = daycare) plus any medical expenses and possibly any “necessary” expenses (tutoring).

                  2. Calculate what he should have paid for all those expenses.

                  3. Calculate what he should have been paying for child support.

                  4. Subtract whatever he did pay (cs plus the $200 plus the extra $200).

                  5. Offer her that money and that they switch to 50/50 with off set support.

                  Yes it will cost your partner some money and yes he has excuse after excuse after excuse why its wrong. A judge may err on the side of “thats not table so you owe”.

                  He messed up and now he has to pay the consequences. He will earn that money back going forward. Making this offer now to fix a problem they both created will go a long way to solve it.

                  And let go of any feelings about the ex and her shopping or money spending. Its not relevant. Money talks when it comes to court. If he puts the amount forward now then she has no argument.

                  Comment


                  • #10
                    I think that's the plan. You're right...whether or not she gave receipts along the way (which their agreement says she was supposed to and he was supposed agree) they both created this problem by not following the agreement in the first place (her only asking for $200 a month and him not demanding receipts and paying in accordance with them).

                    I think he intends on seeing what the balance is owing on special expenses and paying that in a lump sum and moving forward, he'll require proof of payment for everything along the way and she'll need his approval on expenses that are not necessary or unaffordable so there's no muddy water down the line again and who pays what.

                    But regarding the support, she agreed to less in the first place and now demands full table while also making 33% more than she did at the time. I know it's not black and white for the off set method to be applied even at a min of 43% access that he currently has but the judge in his first case conference this week said that based on their access schedule and incomes, the judge said her salary needs to be looked at too and that their agreement did not detail the support the way it should have leading him to believe that the off set or some variation of it may be applied going forward. He's willing to meet her half way there as well and give her much more over the off set that would come of their respective salaries.

                    Regarding access, the ex has said she'll only allow him full 50/50 if he pays full table. I know some people are willing to do this given they're able but he truly isn't without the kids suffering a very different standard of living when they're here almost half the time. If I wasn't part of the equation and contributing to a share of expenses in this household, he wouldn't have a penny left after the mortgage and necessary bills to care for the children during the access he has so it's not something he can just offer up until a judge provides further clarity on that.

                    There's a thread of communication from her saying that when she moved, she'd reduce his support to the off set but obviously he was wrong to trust that not being in writing.


                    Would a reasonable offer to start be that upon her providing the receipts, he offers a lump sum to bring his sec 7 share up to speed, an offer for support to be higher than the off set but lower than the table (somewhere in the middle) and go from there?

                    The access is obviously being addressed separately but if they can agree on the financial part, I don't think she'll keep the kids from him.

                    He wants to settle these outside of trial and if it comes to trial, he wants to make sure it's known that he tried to settle numerous times.

                    Does it look bad on her if she doesn't budge on anything or does that matter to a judge?

                    He needs to try to protect his standard of living for the needs of the kids should we split up down the line. We're not married and the reality of his situation would be that he needs to be able to provide on his own just in case.

                    Comment

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