How is spousal support calculated?
One of the most contentious disputes that comes up in family law is around the issue of spousal support – how much am I owed or how much do I have to pay (if anything), and how does it get calculated? Otherwise known as alimony in the US, spousal support is financial support paid by one spouse (or common-law partner) to the other after the breakdown of a marriage or relationship. The purpose of spousal support is to recognize the contribution that each spouse made to the relationship. It is meant to help the spouse receiving support to become financially independent, if possible.
In Canada, Spousal Support Advisory Guidelines (the “SSAGs”) are a practical tool voluntarily used by judges and lawyers to calculate the amount and length of a spousal support obligation. The SSAGs have not been legislated and are not law but function as informal guidelines with the purpose of making spousal support awards more predictable and consistent. The SSAGs are advisory in nature; however, following the SSAGs can enhance the legitimacy of a spousal support award and aid in the avoidance of arbitrary decision-making.
The initial step in addressing spousal support is determining entitlement. To assist with this, the SSAGs take into account various factors such as:
- Whether you have children
- The duration of your marriage
- The income and earning potential of both spouses
- The standard of living during the marriage
- And, both parties' health conditions
Contrary to popular belief, factors like behavior or adultery are not considered when calculating spousal support. For a more in-depth explanation of spousal support entitlement, check out our blog by senior family lawyer and mediator, Mat Wirove.
Once entitlement is established, the next step is to calculate the range of spousal support one might receive, guided by the Spousal Support Advisory Guidelines (SSAGs). This range typically includes low, mid, and high amounts. Most lawyers recommend the mid-range amount, except in extraordinary circumstances that may warrant a higher or lower payment. To determining spousal support, various types of income are considered including but not limited to employment income, business income, rental income, and unemployment income. The most common method for determining income is to reference Line 15000 of a party’s income tax return (T1 General). The total gross income reported there serves as the basis for both entitlement and support calculations.
It's important to note that if a payor or recipient is self-employed, expenses deducted for income tax purposes do not necessarily reduce the income considered for spousal support calculations. While the Spousal Support Advisory Guidelines do consider reasonable business expenses, general write-offs are typically added back into the income figure for support calculations. For instance, expenses such as vehicle usage strictly for business or a percentage of a phone bill related to business activities may be considered reasonable and could be deducted.
Finally, the amount of support may be influenced by various situational factors such as:
- Your living situation post-separation
- Whether you are the primary caregiver for children
- Your earning capacity after the separation
- Or the outcome of property division during the separation
