NLR 40/98 - Child Support Guidelines Regulations under the Family Law Act

NEWFOUNDLAND AND LABRADOR REGULATION 40/98 Child Support Guidelines Regulations under the Family Law Act (O.C. 98-067) Amended by: 45/01 38/06 50/07 NEWFOUNDLAND AND LABRADOR REGULATION 40/98 Child Support Guidelines Regulations under the Family Law Act (O.C. 98-067) (Filed March 13, 1998) Under the authority of section 85 of the Family Law Act , the Lieutenant-Governor in Council makes the following regulations. Filed at St. Johns , March 5, 1998 . John R. Cummings Deputy Clerk of the Executive Council REGULATIONS Analysis 1. Short title 2. Interpretation 3. Presumptive rule 4. Income over $150,000 5. Standing in place of parent 6. Medical and dental insurance 7. Special or extraordinary expenses 8. Split custody 9. Shared custody 10. Undue hardship 11. Information to be specified in order 12. Circumstances for variation 13. Determination of annual income 14. Calculation of annual income 15. Pattern of income 16. Shareholder, director or officer 17. Imputing income 18. Non-resident 19. Application for child support 20. Failure to comply 21. Adverse inference 22. Failure to comply with court order 23. Continuing obligation to provide income information 24. Child support service 25. Commencement Schedule A Schedule B Short title 1. These regulations may be cited as the Child Support Guidelines Regulations . 40/98 s1 Back to Top Interpretation 2. (1) In these regulations (a) "Act" means the Family Law Act ; (b) "child support" means, unless the context indicates otherwise, monetary support for a child paid or payable in accordance with an order for support or a variation of an order for support of a child under the Act; (c) "guidelines" means these regulations; (d) "income" means the annual income determined under sections 13 to 18; (e) "order for support" has the meaning assigned to it under section 35 of the Act; (f) [Rep. by NR 45/01 s1] (g) "table" means a child support table set out in Schedule I of the Federal Child Support Guidelines enacted under the Divorce Act ( Canada ). (2) Words and expressions that are used in sections 13 to 19 that are not defined in this section have the meanings assigned to them under the Income Tax Act ( Canada ). (3) Where, under the guidelines, an amount is determined on the basis of specified information, the most current information shall be used. 40/98 s2 ; 45/01 s1 Back to Top Presumptive rule 3. (1) Unless otherwise provided under the guidelines, the amount of an order for support of a child under the age of majority is (a) the amount set out in the applicable table, according to the number of children under the age of majority to whom the order relates and the income of the parent against whom the order is sought; and (b) the amount, if any, determined under section 7. (2) Unless otherwise provided under the guidelines, where a child to whom an order for support relates has attained the age of majority, that order is (a) the amount determined by applying the guidelines as if the child were under the age of majority; or (b) the amount that the court considers appropriate, having regard to the condition, means, needs and other circumstance of the child and the financial ability of each parent to contribute to the support of that child. (3) The applicable table is (a) if the parent against whom an order is sought resides in Canada , (i) the table for the province in which that parent ordinarily resides at the time the application for an order for support of a child, or for a variation of an order for support of a child is made or the amount is to be recalculated in accordance with the Act, (ii) where the court is satisfied that the province in which that parent ordinarily resides has changed since the time described in subparagraph (i), the table for the province in which the parent ordinarily resides at the time of determining the amount of support, or (iii) where the court is satisfied that, in the near future after determination of the amount of support, that parent shall ordinarily reside in a given province other than the province in which the parent ordinarily resides at the time of that determination, the table for the given province; and (b) if the parent against whom an order for support of a child is sought resides outside Canada, or if the residence of that parent is unknown, the table for the province where the other parent ordinarily resides at the time the application for an order for support of a child or a variation of an order for support of a child is made or the amount is to be recalculated in accordance with the Act. 40/98 s3 Back to Top Income over $150,000 4. Where the income of the parent against whom an order for support of a child is sought is over $150,000, the amount of that order shall be (a) the amount determined under section 3; or (b) if the court considers that amount to be inappropriate, (i) in respect of the first $150,000 of that parents income, the amount set out in the applicable table for the number of children under the age of majority to whom the order relates, (ii) in respect of the balance of that parents income, the amount that the court considers appropriate, having regard to the condition, means, needs and other circumstances of the children who are entitled to support and the financial ability of each parent to contribute to the support of the children, and (iii) the amount determined under section 7. 40/98 s4 Back to Top Standing in place of parent 5. Where a parent against whom an order for support of a child is sought is a person who stands in the place of a parent for that child, the amount of the order is, in respect of that parent, an amount that the court considers appropriate having regard to these guidelines and another parents legal duty to support the child. 40/98 s5 Back to Top Medical and dental insurance 6. In making an order for support of a child, the court may order that medical or dental insurance coverage be acquired or continued where coverage for the child is available to either parent through his or her employer or otherwise at a reasonable rate. 40/98 s6 Back to Top Special or extraordinary expenses 7. (1) In an order for child support the court may, on either parents request, provide for an amount to cover the following expenses, or a portion of those expenses, which expenses may be estimated, taking into account the necessity of the expense in relation to the child's best interests and the reasonableness of the expense in relation to the means of the parents and those of the child and to the family's spending pattern prior to the separation: (a) child care expenses incurred as a result of the custodial parents employment, illness, disability or education or training for employment; (b) the portion of medical and dental insurance premiums attributable to the child; (c) health-related expenses that exceed insurance reimbursement by at least $100 annually, including orthodontic treatment, professional counselling provided by a psychologist, social worker, psychiatrist or other person, physiotherapy, occupational therapy, speech therapy and prescription drugs, hearing aids, glasses and contact lenses; (d) extraordinary expenses for primary or secondary school education or for educational programs that meet the childs particular needs; (e) expenses for post secondary education; and (f) extraordinary expenses for extracurricular activities. (1.1) For the purposes of paragraphs (1)(d) and (f), the term "extraordinary expenses" means (a) expenses that exceed those that the spouse requesting an amount for the extraordinary expenses can reasonably cover, taking into account that spouse's income and the amount that the spouse would receive under the applicable table or, where the court has determined that the table amount is inappropriate, the amount that the court has otherwise determined is appropriate; or (b) where paragraph (a) is not applicable, expenses that the court considers are extraordinary taking into account (i) the amount of the expense in relation to the income of the spouse requesting the amount, including the amount that the spouse would receive under the applicable table or, where the court has determined the table amount is inappropriate, the amount that the court has otherwise determined is appropriate, (ii) the nature and number of the educational programs and extracurricular activities, (iii) special needs and talents of the child or children, (iv) the overall cost of the programs and activities, and (v) other similar factor that the court considers relevant. (2) The guiding principle in determining the amount of an expense referred to in subsection (1) is that the expense is shared by the parents in proportion to their respective incomes after deducting from the expense, the contribution, if any, from the child. (3) In determining the amount of an expense referred to in subsection (1), the court shall take into account subsidies, benefits or income tax deductions or credits relating to the expense, and eligibility to claim a subsidy, benefit or income tax deduction or credit relating to the expense. 40/98 s7 ; 45/01 s2 ; 38/06 s1 Back to Top Split custody 8. Where each parent has custody of one or more children, the amount of an order for support of a child is the difference between the amount that each parent would otherwise pay if an order for support of a child were sought against each of the parents of those children. 40/98 s8 Back to Top Shared custody 9. Where a parent exercises a right of access to, or has physical custody of, a child for not less than 40% of the time over the course of a year, the amount of the order for support of the child shall be determined by taking into account (a) the amounts set out in the applicable tables for each of the parents of the child; (b) the increased costs of shared custody arrangements; and (c) the conditions, means, needs and other circumstances of each parent and of a child for whom support is sought. 40/98 s9 Back to Top Undue hardship 10. (1) On application of either parent, a court may award an amount of child support that is different from the amount determined under sections 3 to 5, 8 or 9 if the court finds that the parent making the request, or a child in respect of whom the request is made, would otherwise suffer undue hardship. (2) Circumstances that may cause a parent or child to suffer undue hardship include (a) the parent has responsibility for an unusually high level of debts reasonably incurred to support the parents and their children before their separation or to earn a living; (b) the parent has unusually high expenses in relation to exercising access to a child; (c) the parent has a legal duty under a judgment, order or written separation agreement to support a person; (d) the parent has a legal duty to support a child other than a child for whom an order for support is being sought, who (i) is under the age of majority, or (ii) has attained the age of majority but is unable, by reason of illness, disability or other cause, to obtain the necessaries if life; and (e) the parent has a legal duty to support a person who is unable to obtain the necessaries of life due to an illness or disability. (3) Despite a determination of undue hardship under subsection (1), an application under that subsection shall be denied by the court if it is of the opinion that the household of the parent who claims undue hardship would, after determining the amount of child support under section 3 to 5, 8 or 9, have a higher standard of living than the household of the other parent. (4) In comparing standards of living for the purpose of subsection (3), the court may use the comparison of household standards of living set out in Schedule A. (5) Where the court awards a different amount of child support under subsection (1), it may specify, in the order for support of a child, a reasonable time for the satisfaction of an obligation arising from circumstances that cause undue hardship and the amount payable at the end of that time. (6) Where the court makes an order for support of a child in a different amount under this section, it shall state its reasons for doing so. 40/98 s10 Back to Top Information to be specified in order 11. An order for support of a child shall include the following: (a) the name and birth date of each child to whom the order relates; (b) the income of a parent whose income is used to determine the amount of the order for support of a child; (c) the amount determined under paragraph 3(1)(a) for the number of children to whom the order relates; (d) the amount determined under paragraph 3(2)(b) for a child who has attained the age of majority; (e) the particulars of an expense described in subsection 7(1), the child to whom the expense relates, and the amount of the expense or, where that amount cannot be determined, the proportion to be paid in relation to the expense; and (f) the date on which the lump sum or first payment is payable and the day of the month or other time period on which all subsequent payments are to be made. 40/98 s11 Back to Top Circumstances for variation 12. For the purposes of paragraph 47(1)(a) of the Act, any one of the following constitutes a material change in circumstances that gives rise to the making of a variation order in respect of an order for child support (a) in the case where the amount of child support includes a determination made in accordance with the applicable table, a change in circumstances that would result in a different order for support of a child or a different provision of that order for support; (b) in the case where the amount of child support does not include a determination made in accordance with a table, a change in the condition, means, needs or other circumstances of either parent or of a child who is entitled to support; and (c) in the case of an order for support of a child made under the Act before April 1, 1998 . 40/98 s12 ; 45/01 s3 Back to Top Determination of annual income 13. (1) A parents annual income shall be determined by the court in accordance with sections 14 to 18. (2) Notwithstanding subsection (1), where both parents agree in writing on the annual income of a parent, the court may consider that amount to be the parents income for the purposes of these guidelines if the court thinks that the amount is reasonable having regard to the income information provided under section 19. 40/98 s13 Back to Top Calculation of annual income 14. Subject to sections 15 to 18, a parents annual income shall be determined using the sources of income set out under the heading "Total Income" in the T-1 General form issued by Canada Customs and Revenue Agency and is adjusted in accordance with Schedule B. 40/98 s14 ; 45/01 s4 Back to Top Pattern of income 15. (1) Where a court is of the opinion that the determination of a parents annual income under section 14 would not be the fairest determination of that income, the court may have regard to the parent's income over the last 3 years and determine an amount that is fair and reasonable in light of any pattern of income, fluctuation in income or receipt of a non-recurring amount during those years. (2) Where a parent has incurred a non recurring capital or business investment loss, the court may, if it is of the opinion that the determination of the parents annual income under section 14 would not provide the fairest determination of the annual income, choose not to apply sections 6 and 7 of Schedule B, and adjust the amount of the loss, including related expenses and carrying charges and interest expenses, to arrive at an amount that the court considers appropriate. 40/98 s15 ; 45/01 s5 Back to Top Shareholder, director or officer 16. (1) Where a parent is a shareholder, director or officer of a corporation and the court is of the opinion that the amount of the parents annual income as determined under section 14 does not fairly reflect all the money available to the parent for the payment of child support, the court may consider the situations described in section 15 and determine the parents annual income to include (a) all or part of the pre-tax income of the corporation, and of any corporation that is related to that corporation, for the most recent taxation year; or (b) an amount commensurate with the services that the parent provides to the corporation, provided that the amount does not exceed the corporations pre-tax income. (2) In determining the pre-tax income of a corporation for the purposes of subsection (1), all amounts paid by the corporation as salaries, wages or management fees, or other payments or benefits, to or on behalf of persons with whom the corporation does not deal at arms length shall be added to the pre-tax income, unless the parent establishes that the payments were reasonable in the circumstances. 40/98 s16 Back to Top Imputing income 17. (1) The court may impute an amount of income to a parent that it considers reasonable in the circumstances, which circumstances include the following: (a) the parent is intentionally under-employed or unemployed, other than where the under-employment or unemployment is required by the needs of a child of that parent and the parent against whom an order for support of a child is sought or another child under the age of majority or by the reasonable educational or health needs of the parent; (b) the parent is exempt from paying federal or provincial income tax; (c) the parent lives in a country that has effective rates of income tax that are significantly lower than those in Canada ; (d) it appears that income has been diverted which would affect the level of child support to be determined under these guidelines; (e) the parents property is not reasonably utilized to generate income; (f) the parent has failed to provide income information when under a legal obligation to do so; (g) the parent unreasonably deducts expenses from income; (h) the parent derives a significant portion of income from dividends, capital gains or other sources that are taxed at a lower rate than employment or business income or that are exempt from tax; and (i) the parent is a beneficiary under a trust and is or shall be in receipt of income or other benefits from the trust. (2) For the purposes of paragraph (1)(g), the reasonableness of an expense deduction is not solely governed by whether the deduction is permitted under the Income Tax Act ( Canada ). 40/98 s17 ; 45/01 s6 Back to Top Non-resident 18. (1) Where a spouse is a non-resident of Canada , the spouse's annual income is determined as though the spouse were a resident of Canada . (2) Notwithstanding subsection (1), where a spouse is a non-resident of Canada and resides in a country that has effective rates of income tax that are significantly higher than those applicable in the province in which the other spouse ordinarily resides, the spouse's annual income is the amount that the court determines to be appropriate taking those rates into consideration. 38/06 s2 Back to Top Application for child support 19. (1) An applicant for a child support order whose income information is necessary to determine the amount of the order shall provide to the court and the opposing respondent (a) a copy of every personal income tax return filed by him or her for each of the 3 most recent taxation years; (b) a copy of every notice of assessment and reassessment issued to him or her for each of the 3 most recent taxation years; (c) where he or she is an employee, the most recent statement of earnings indicating the total earnings paid in the year to date, including overtime or, where a statement is not provided by the employer, a letter from his or her employer setting out that information including his or her rate of annual salary or remuneration; (d) where he or she is self employed, for the 3 most recent taxation years (i) the financial statements of his or her business or professional practice, other than a partnership, and (ii) a statement showing a breakdown of all salaries, wages, management fees or other payments or benefits paid to or on behalf of, persons or corporations with whom he or she does not deal at arms length; (e) where he or she is a partner in a partnership, confirmation of his or her income and draw from, and capital in, the partnership for its 3 most recent taxation years; (f) where he or she controls a corporation, for the 3 most recent taxation years (i) the financial statements of the corporation and its subsidiaries, and (ii) a statement showing a breakdown of all salaries, wages, management fees or other payments or benefits paid to, or on behalf of, persons or corporations with whom the corporation, and every related corporation, does not deal at arms length; (g) where he or she is a beneficiary under a trust, a copy of the trust settlement agreement and copies of the trusts 3 most recent financial statements; and (h) where the parent receives income from employment insurance, social assistance, a pension, workers' compensation, disability payments or other source, the most recent statement of income indicating the total amount of income from the applicable source during the current year, or if such a statement is not provided, a letter from the appropriate authority stating the required information. (2) A person who is served with an application for a child support order and whose income information is necessary to determine the amount of the order, shall, within 30 days after the application is served if the person resides in Canada or the United States or within 60 days if he or she resides elsewhere, or the other time limit that the court specifies, provide the court as well as the applicant or another person, if there is one, with the documents referred to in subsection (1). (3) Where, in the course of proceedings in respect of an application for a child support order, an applicant requests an amount to cover expenses referred to in subsection 7(1) or pleads undue hardship, the applicant shall, within 30 days after the amount is sought or undue hardship is pleaded if the applicant resides in Canada or the United Statues or within 60 days if he or she resides elsewhere, or the other time limit that the court specifies, provide the court and the respondent with the documents referred to in subsection (1). (4) Where, in the course of proceedings in respect of an application for support of a child, it is established that the income of the parent who would be paying the amount of child support is greater than $150,000, the other parent shall, within 10 days after the income is established to be greater than $150,000 if the other parent resides in the province, within 30 days if the other parent resides in another province of Canada or in the United States of America or within 60 days if the other parent resides elsewhere, or the other time limit that the court specifies, provide the court and the parent with the documents referred to in subsection (1). (5) Nothing in this section precludes the making of rules by a competent authority respecting the disclosure of income information that is considered necessary for the purposes of the determination of an amount for an order for support of a child. (6) In this section (a) "applicant" means a parent or other person who applies under Part III of the Act for an order for support of a child; (b) "application" means an application for an order for support of a child made under Part III of the Act; and (c) "respondent" means a parent against whom an application is made for an order for support of a child. 50/07 s1 Back to Top Failure to comply 20. (1) Where a parent fails to comply with section 19, the other parent may apply (a) to have the application for an order for support of a child set down for a hearing, or move for judgment; or (b) for an order requiring the parent who failed to comply to provide the court as well as the other parent or assignee of an order for support of a child, with the required documents. (2) Where a court makes an order under subsection (1), the court may award costs in favour of the other parent up to an amount that fully compensates the other parent for all costs incurred in the proceedings. 40/98 s20 Back to Top Adverse inference 21. Where the court proceeds to a hearing on the basis of an application under paragraph 20(1)(a), the court may draw an adverse inference against the parent who failed to comply and impute income to that parent in an amount that it considers appropriate. 40/98 s21 ; 45/01 s8 Back to Top Failure to comply with court order 22. Where a parent fails to comply with an order issued on the basis of an application under paragraph 20(1)(b), the court may (a) strike out any of that parents pleadings; (b) make a contempt order against that parent; (c) proceed to a hearing, in the course of which it may draw an adverse inference against that parent and impute income to that parent in an amount that in an amount that it considers appropriate; and (d) award costs in the favour of the other parent up to an amount that fully compensates the other parent for all costs incurred in the proceedings. 40/98 s22 Back to Top Continuing obligation to provide income information 23. (1) A parent against whom an order for support of a child has been made shall, on the written request of the other parent or an assignee of the order for support of a child, not more than once a year after the making of that order and as long as the child is a child within the meaning of section 37 of the Act and these guidelines, provide that other parent or the assignee of that order for support of a child with (a) the documents referred to in subsection 19(1) for any of the 3 most recent taxation years for which the parent has not previously provided the documents; (b) as applicable, current information, in writing, about the status of expenses included in the order for support under subsection 7(1); and (c) as applicable, any current information, in writing, about the circumstances relied on by the court in a determination of undue hardship. (2) Where a court has determined that the parent against whom an order for support of a child is sought does not have to pay child support because his or her income level is below the minimum amount required for the application of the tables, that parent shall, on the written request of the other parent and not more than once a year after the determination as long as the child is a child within the meaning of section 37 of the Act and these guidelines, provide the other parent with the documents referred to in subsection 19(1) for any of the 3 most recent taxation years for which the parent has not previously provided the documents. (3) Where the income information of the parent in favour of whom an order for support of a child is made is used to determine the amount of the order for support of a child, the parent shall, not more than once a year after the making of the order and as long as the child is a child within the meaning of section 37 of the Act and these guidelines, on the written request of the other parent, provide the other parent with the documents and information referred to in subsection (1). (4) Where a parent or an assignee of an order for support of a child requests information from the other parent under subsections (1), (2) or (3), and the income information of the requesting parent is used to determine the amount of the order for support of a child, the requesting parent or assignee shall include the documents and information referred to in subsection (1) with the request. (5) A parent who receives a request under subsection (1), (2) or (3) shall provide the required documents within 30 days after the requests receipt if the parent resides in Canada or the United States of America and within 60 days after the requests receipt if the parent resides elsewhere. (6) A request made under subsection (1), (2) or (3) is considered to have been received 10 days after it is sent. (7) A court may, on application by either parent or an assignee of an order for support of a child, where the other parent has failed to comply with subsection (1), (2) or (3) (a) consider the other parent to be in contempt of court and award costs in favour of the applicant up to an amount that fully compensates the applicant for all costs incurred in the proceedings; or (b) make an order requiring the other parent to provide the required documents to the court, as well as to the parent or assignee of the order for support of a child. (8) A provision in a judgment, order or agreement purporting to limit a parents obligation to provide documents under this section is unenforceable. 40/98 s23 Back to Top Child support service 24. A parent or an assignee of an order for support of a child may appoint a child support service to act on their behalf for the purpose of requesting and receiving income information under subsection 23(1), (2) or (3) as well as for the purposes of an application under subsection 23 (7). 40/98 s24 Back to Top Commencement 25. These regulations shall come into force on April 1, 1998 . 40/98 s25 Back to Top Schedule A Comparison of Household Standards of Living Test 1. In this Schedule (a) [Rep. by NR 45/01 s9] (b) "child" means, in addition to the meaning attributed to it under the Act, (i) a child under the age of majority, or (ii) a child who has attained the age of majority and who is under the charge of his or her parent and is unable by reason of illness, disability or other cause to obtain the necessaries of life; (c) "household" means a parent and any of the following persons residing with the parent: (i) a person who has a legal duty to support the parent or whom the parent has a legal duty to support, (ii) a person who shares living expenses with the parent or from whom the parent otherwise receives an economic benefit as a result of living with that person, if the court considers it reasonable for that person to be considered part of the household, and (iii) a child whom the parent or the person described in paragraph (a) or (b) has a legal duty to support; and (d) "taxable income means the annual taxable income determined using the calculations required to determine "Taxable Income" in the T-1 General form issued by Canada Customs and Revenue Agency under the Income Tax Act ( Canada ). 2. The comparison of household standards of living test is as follows: STEP 1 Establish the annual income of each person in each household by applying the formula A - B - C where A = is the persons income determined under sections 15 to 20 of these guidelines, B = is the federal and provincial taxes payable on the persons taxable income, and C = is the person's source deductions for premiums paid under the Employment Insurance Act (Canada) and contributions made to the Canada Pension Plan (Canada) and the Quebec Pension Plan. Where the information on which to base the income determination is not provided, the court may impute income in the amount it considers appropriate. STEP 2 Adjust the annual income of each person in each household by (a) deducting the following amounts, calculated on an annual basis: (i) an amount relied on by the court as a factor that resulted in a determination of undue hardship, except an amount attributable to the support of a member of the household that is not incurred due to a disability or serious illness of that member, (ii) the amount that would otherwise be payable by the person in respect of a child to whom the order for support relates, if the pleading of undue hardship was not made, under these guidelines if the pleading of undue hardship was not made, (A) under the applicable table, or (B) as is considered by the court to be appropriate, where the court considers the table amount to be inappropriate, and (iii) an amount of support that is paid by the person under a judgment, order or written separation agreement, except (A) an amount already deducted under subparagraph (i), and (B) an amount paid by the person in respect of a person other than a child to whom the order referred to in subparagraph (ii) relates; and (b) adding the following amounts, calculated on an annual basis (i) an amount that would otherwise be receivable by the person in respect of a child to whom the order for support relates, if the pleading of undue hardship was not made, (A) under the applicable table, or (B) as is considered by the court to be appropriate, where the court considers the table amount to be inappropriate, and (ii) any amount of child support that the person has received for any child under a judgment, order or written separation agreement. STEP 3 Add the amounts of adjusted annual income for all the persons in each household to determine the total household income for each household. STEP 4 Determine the applicable low-income measures amount for each household based on the following: Low Income Measure Household Size Low-income Measures Amount One person 1 adult $10,382 Two persons 2 adults $14,535 1 adult and 1 child 14,535 Three persons 3 adults $18,688 2 adults and 1 child 17,649 1 adult and 2 children 17,649 Four persons 4 adults $22,840 3 adults and 1 child 21,802 2 adults and 2 children 20,764 1 adult and 3 children 20,764 Five persons 5 adults $26,993 4 adults and 1 child 25,955 3 adults and 2 children 24,917 2 adults and 3 children 23,879 1 adult and 4 children 23,879 Six persons 6 adults $31,145 5 adults and 1 child 30,108 4 adults and 2 children 29,070 3 adults and 3 children 28,031 2 adults and 4 children 26,993 1 adult and 5 children 26,993 Seven persons 7 adults $34,261 6 adults and 1 child 33,222 5 adults and 2 children 32,184 4 adults and 3 children 31,146 3 adults and 4 children 30,108 2 adults and 5 children 29,070 1 adult and 6 children 29,070 Eight persons 8 adults $38,413 7 adults and 1 child 37,375 6 adults and 2 children 36,337 5 adults and 3 children 35,299 4 adults and 4 children 34,261 3 adults and 5 children 33,222 2 adults and 6 children 32,184 1 adult and 7 children 32,184 STEP 5 Divide the household income amount, Step 3, by the low income measures amount, Step 4, to get a household income ratio for each household. STEP 6 Compare the household income ratios. The household that has the higher ratio has the higher standard of living. 40/98 Sch A ; 45/01 s9 ; 38/06 s3 Back to Top Schedule B Section 14 ADJUSTMENTS TO INCOME Deductions 1. Where the parent is an employee, the parents applicable employment expenses described in the following provisions of the Income Tax Act ( Canada ) are deducted (a) [Rep. by NR 45/01 s10] (b) paragraph 8(1)(d) concerning expenses of teachers exchange fund contribution; (c) paragraph 8(1)(e) concerning expenses of railway employees; (d) paragraph 8(1)(f) concerning sales expenses; (e) paragraph 8(1)(g) concerning transport employees expenses; (f) paragraph 8(1)(h) concerning travel expenses; (f.1) paragraph 8(1)(h) concerning motor vehicle travel expenses; (g) paragraph 8(1)(i) concerning dues and other expenses of performing duties; (h) paragraph 8(1)(j) concerning motor vehicle and aircraft costs; (i) paragraph 8(1)(l.1) concerning Canada Pension Plan contributions and Employment Insurance Act (Canada) premiums paid in respect of another employee who acts as an assistant or substitute for the parent; (j) paragraph 8(1)(n) concerning salary reimbursement; (k) paragraph 8(1)(o) concerning forfeited amounts; (l) paragraph 8(1)(p) concerning musical instrument costs; and (m) paragraph 8(1)(q) concerning artists employment expenses. Child support 2. Deduct any child support received that is included to determine total income in the T-1 General form issued by Canada Customs and Revenue Agency. Support 3. (1)To calculate income for the purpose of determining an amount under an applicable table, deduct the support received from the other parent. (2) To calculate income for the purpose of determining an amount under section 7 of the guidelines, deduct the support paid to the other parent. Social assistance 4. Deduct social assistance income that is not attributable to the parent. Dividends from taxable Canadian corporation 5. Replace the taxable amount of dividends from taxable Canadian corporations received by the parent by the actual amount of those dividends received by the parent. Capital gains and capital losses 6. Replace the taxable capital gains realized in a year by the parent by the actual amount of capital gains realized by the parent in excess of the parents actual capital losses in that year. Business investment losses 7. Deduct the actual amount of business investment losses suffered by the parent during the year. Carrying charges 8. Deduct the parents carrying charges and interest expenses that are paid by the parent and that would be deductible under the Income Tax Act ( Canada ). Net self-employment income 9. Where the parents net self-employment income is determined by deducting an amount for salaries, benefits, wages or management fees, or other payments, paid to or on behalf of persons with whom the parent does not deal at arms length, include that amount, unless the parent establishes that the payments were necessary to earn the self-employment income and were reasonable in the circumstances. Additional amount 10. Where the parent reports income from self-employment that, in accordance with sections 34.1 and 34.2 of the Income Tax Act ( Canada ), includes an additional amount earned in a prior period, deduct the amount earned in the prior period, net of reserves. Capital cost allowance for property 11. Include the parents deduction for an allowable capital cost allowance with respect to real property. Partnership or sole proprietorship income 12. Where the parent earns enough income through a partnership or sole proprietorship, deduct an amount included in income that is properly required by the partnership or sole proprietorship for purposes of capitalization. Share options 13. (1) Where the parent has received, as an employee benefit, options to purchase shares of a Canadian controlled private corporation and has exercised those options during the year, add the difference between the value of the shares at the time the options are exercised and the amount paid by the parent for the shares and any amount paid to acquire the options to purchase the shares, to the income for the year in which the options are exercised. (2) If the parent has disposed of the shares during a year, deduct from the income for that year the difference determined under subsection (1). 40/98 Sch B ; 45/01 s10 ©Earl G. Tucker, Queen's Printer