Child Support - Calculation

The Federal Child Support Guidelines (the "Guidelines") list 4 objectives. One is to simplify the calculation of child support. In the majority of cases this is achieved by the Guidelines. So, I'll start by telling you how you would calculate child support in a simple case.

First, you need to know about 12 pieces of information (some simple, some not so simple):

1. Number of children (simple usually);
2. If any of the children are over 18 and still in school (not always simple)
3.The custody/parenting arrangement (definitely not always simple);
4. Which Province the payor parent r esides in (probably simple);
5. The father's income (not always simple, the Guidelines have 3 pages to help with this);
6. The mother's income (not always simple);
7. The after-tax cost of child care for employment or schooling (takes a bit of investigation);
8. Health care -- the child's portion of health insurance (usually simple);
9. Health care -- the uninsured health expenses -- might be ortho, extra dental charges, etc. (simple?)
10. Extraordinary school expenses (simple?)
11. Extraordinary extracurricular expenses (simple?)
12. Post Secondary expenses (simple?)

If you and the other parent can find a way to make this simple and are able to put the above listed information together, you are off to the races and child support will be simple to calculate. For the rest of parents who cannot agree on the above 12 items, things get complicated in a hurry. I can advise that I have dealt with complication to each and every item listed.

Back to the simple example, if the parties agree the variables are as follows:

1. There are 2 children;
2. None over 18;
3. Custody is with the mother and the father has access;
4. The father/payor lives in Alberta;
5. The father/payor earns a gross income of $75,000 a year working for the government;
6. The mother earns a gross income of $25,000 a year working for a store;
7-12. The parties agree that the after tax daycare cost is $500 per month and there are swimming, soccer and music lessons during different times of the year, which cost an average of $100 per month.

The determine child support using the above listed factors, now there are 2 more steps:

First, the base child support is determined using the Guideline tables for the Province in which the payor lives, the number of children and the payor parent's gross annual income. This is a link for the Alberta tables. http://www.justice.gc.ca/eng/pi/fcy-fea/lib-bib/legis/fcsg-lfpae/index.html#ab

The link shows that payors in Alberta earning $75,000 gross per year who have two children must pay $1082 in child support every month. This payment is after tax for the payor and the recipient receives it tax free.

The second step is to determine the sharing of the Section 7 expenses. In this case, the Section 7s cost $600 per month -- $500 for net daycare and $100 for extracurriculars.

These expenses are paid in proportion to the parties' incomes. In this case, the Husband earns $75,000 and the Wife earns $25,000. The family total is $100,000. The Husband must pay $75,000 divided by the family total of $100,000 or 75% of the Section 7s. 75% of $600 is $450.

Summary: The Husband pays a base amount of $1082 + $450 in Section 7s.

Simple right?? The Legislators and the Courts think it is sufficiently simple that they expect it to be paid. And even if it is not simple, they expect you to figure it out, by agreeing, using lawyers, using government services to help you and reading up on this on government websites. From personal experience I can advise that it is probably about 80% simple and straightforward.

As I always suggest: speak to a lawyer about this. There are a lot of exceptions and other rules to the Guidelines that could increase or reduce your support. You need to be aware of these because child support can be changed every year, or with changes to incomes or with self-employment income or changes to custody and parenting or Section 7 expenses or a host of other factors. As they say 'the devil is in the detail' and there are a lot of details which can come into play. Get a lawyer to tell you how it works and to warn you of things that could happen if circumstances change.