Here is what the Spousal Support Calculator says...
Input the taxable amount of dividends (both eligible and other than (ie. non) eligible) that the party received from taxable Canadian corporations (T1, Line 120).
IMPORTANT: You must also input any non eligible dividends under:
"Taxable CDN dividends (non eligible)".
NOTE: To input the actual (rather than taxable) amount of dividends, go to "Actual CDN dividends (eligible)" and/or "Actual CDN dividends (non eligible)", as applicable.
There are two types of dividends that a party may have received from taxable Canadian corporations:
eligible (T5 slip, Box 25; T4PS slip, Box 31; T3 slip, Box 50; T5013 or T5013A slip, Box 52-1); and/or
other than (ie. non) eligible (T5 slip, Box 11; T4PS slip, Box 25; T3 slip, Box 32; T5013 or T5013A slip, Box 51-1).
To determine the type of dividend received, the party should contact the payor of the dividends.
If no information slip is received, to calculate the taxable amount of these dividends:
multiply the actual amount of eligible dividends by 144%;
multiply the actual amount of other than (ie. non) eligible dividends by 125%.
Note that the software will automatically calculate the dividend tax credit. As well, the software will automatically back out the grossed-up amount of the taxable dividends from the party's annual income in the determination of the party's Guidelines Income and child and/or spousal support.
According to the CSG, annual income is determined using Line 150 ("Total income") of the T1 General form, adjusted in accordance with Schedule III and ss. 17, 18 and 19 of the CSG. This is commonly referred to as "Guidelines Income".
Note that the SSAG use the same definition of annual income as under the CSG, with some exceptions.
See the help under "Employment Income" regarding Guidelines Income caps under the CSG and ceilings, floors, and floor exceptions under the SSAG.
My Rebuttal:
Ok now we are getting into some juicy stuff.
What I can tell you is that if you are a corporate owner, you are basically screwed if you expect any lawyer or judge to calculate this correctly.
First of all, you need some definitions:
Eligible Dividends - This means dividends that are eligible for the small business deduction of 400,000 of income. These dividends are grossed up by 25%. The reason there is a grossup and a dividend tax credit is to account for the progressive nature of our tax code. (ie the higher your income, the higher rate of tax you pay on that extra income)
To be continued...
Sunday, July 18, 2010
Income Section - Employment Insurance Benefits (EI)
Here is what the Spousal Support Calculator says...
Input the annual amount of any employment insurance and other benefits received by a party (T1, Line 119; T4E slip, Box 14 minus Box 18).
According to the CSG, annual income is determined using Line 150 ("Total income") of the T1 General form, adjusted in accordance with Schedule III and ss. 17, 18 and 19 of the CSG. This is commonly referred to as "Guidelines Income".
Note that the SSAG use the same definition of annual income as under the CSG, with some exceptions.
See the help under "Employment Income" regarding Guidelines Income caps under the CSG and ceilings, floors, and floor exceptions under the SSAG.
TIP: There is a built-in conversion feature. See the help under "Employment Income".
My Rebuttal:
Since tax returns are historical data, one must assess the current situation. Perhaps the unemployed person has returned to work. In that case, his current salary should be imputed and any amounts on this line and line 101 would be ignored. The same situation could happen if there was a parental leave.
Bottom line is the current situation must be assessed and proper income needs to be imputed and this line ignored. That is my view.
Input the annual amount of any employment insurance and other benefits received by a party (T1, Line 119; T4E slip, Box 14 minus Box 18).
According to the CSG, annual income is determined using Line 150 ("Total income") of the T1 General form, adjusted in accordance with Schedule III and ss. 17, 18 and 19 of the CSG. This is commonly referred to as "Guidelines Income".
Note that the SSAG use the same definition of annual income as under the CSG, with some exceptions.
See the help under "Employment Income" regarding Guidelines Income caps under the CSG and ceilings, floors, and floor exceptions under the SSAG.
TIP: There is a built-in conversion feature. See the help under "Employment Income".
My Rebuttal:
Since tax returns are historical data, one must assess the current situation. Perhaps the unemployed person has returned to work. In that case, his current salary should be imputed and any amounts on this line and line 101 would be ignored. The same situation could happen if there was a parental leave.
Bottom line is the current situation must be assessed and proper income needs to be imputed and this line ignored. That is my view.
Income Section - Elected Split-pension amount
I must apologize for the delay (almost two months) since my last post. So many people need help (mostly men) who are being bankrupted by this corrupt system. I do my best to answer every email I can to help them right this injustice. In addition, I have had to spend time on my own case (the Trial Management Conference is this coming week) I am hoping the judge can finally see reality. I have calculated he has given her between 70-75% of the income. And somehow I am expected to survive? I have no reason to believe any other men are getting any more justice than I am therefore I believe I have a responsibility to share my knowledge to help others.
This is what the Spousal Support Calculator says...
Input the jointly elected split-pension annual amount that a party is receiving from his/her spouse or common law partner's pension income (T1, Line 116; Form T1032, Line E).
Note that the party and his/her spouse or common law partner must have jointly elected to split the pension income and have filed a Form T1032. Further, only one joint election can be made for a tax year, so if both spouses/common law partners have pension income, only one person's pension income (up to 50%) can be split.
Note that the software will automatically deduct this split-pension amount from the party's annual income in the determination of the party's Guidelines Income and child and/or spousal support (CSG, Sch. III, s.14).
According to the CSG, annual income is determined using Line 150 ("Total income") of the T1 General form, adjusted in accordance with Schedule III and ss. 17, 18 and 19 of the CSG. This is commonly referred to as "Guidelines Income".
Note that the SSAG use the same definition of annual income as under the CSG, with some exceptions.
See the help under "Employment Income" regarding Guidelines Income caps under the CSG and ceilings, floors, and floor exceptions under the SSAG.
TIP: There is a built-in conversion feature. See the help under "Employment Income".
My Rebuttal:
The whole basis for the split pension amount is for the couple to pay less tax. For example a 50,000 income on one tax return pays more tax than a 25,000 income each on two returns. You really can't arbitrarily add this for the calculation of child support and spousal support. What the couple is trying to do is ensure taxable income is equally split so they pay less tax. You would have to assess what happened during the relationship with regards to pension and a variety of other factors to determine the correct split. I'm not going to spend too much time on this because it will affect relatively few people and the issues would be extremely complex.
This is what the Spousal Support Calculator says...
Input the jointly elected split-pension annual amount that a party is receiving from his/her spouse or common law partner's pension income (T1, Line 116; Form T1032, Line E).
Note that the party and his/her spouse or common law partner must have jointly elected to split the pension income and have filed a Form T1032. Further, only one joint election can be made for a tax year, so if both spouses/common law partners have pension income, only one person's pension income (up to 50%) can be split.
Note that the software will automatically deduct this split-pension amount from the party's annual income in the determination of the party's Guidelines Income and child and/or spousal support (CSG, Sch. III, s.14).
According to the CSG, annual income is determined using Line 150 ("Total income") of the T1 General form, adjusted in accordance with Schedule III and ss. 17, 18 and 19 of the CSG. This is commonly referred to as "Guidelines Income".
Note that the SSAG use the same definition of annual income as under the CSG, with some exceptions.
See the help under "Employment Income" regarding Guidelines Income caps under the CSG and ceilings, floors, and floor exceptions under the SSAG.
TIP: There is a built-in conversion feature. See the help under "Employment Income".
My Rebuttal:
The whole basis for the split pension amount is for the couple to pay less tax. For example a 50,000 income on one tax return pays more tax than a 25,000 income each on two returns. You really can't arbitrarily add this for the calculation of child support and spousal support. What the couple is trying to do is ensure taxable income is equally split so they pay less tax. You would have to assess what happened during the relationship with regards to pension and a variety of other factors to determine the correct split. I'm not going to spend too much time on this because it will affect relatively few people and the issues would be extremely complex.
Sunday, May 23, 2010
Income Section - Other pensions or superannuation
Here is what the Spousal Support Calculator says...
Other pensions or superannuation
Input the annual amount of any other pensions or superannuation that the party received that have not already been included under another category (T1, Line 115).
Examples of "Other pensions or superannuation" include (ie. not exhaustive):
T4A slip, Box 16;
T3 slip, Box 31;
annuity and registered retirement income fund (RRIF), including life income fund, payments, if party is 65 or older, or if party is recipient because of death of spouse or common-law partner (T4A slip, Box 24 or Box 28; T4RIF slip, Box 16 or 20; T5 slip, Box 19);
gross amount of pensions from a foreign country (converted to Canadian dollars);
United States individual retirement account (IRA);
United States social security and Medicare premiums paid on party's behalf.
According to the CSG, annual income is determined using Line 150 ("Total income") of the T1 General form, adjusted in accordance with Schedule III and ss. 17, 18 and 19 of the CSG. This is commonly referred to as "Guidelines Income".
Note that the SSAG use the same definition of annual income as under the CSG, with some exceptions.
See the help under "Employment Income" regarding Guidelines Income caps under the CSG and ceilings, floors, and floor exceptions under the SSAG.
TIP: There is a built-in conversion feature. See the help under "Employment Income".
My Rebuttal:
I again reference my rebuttal to Old Age Security. It seems very unfair to me to include all this pension arbitrarily especially when the majority of it could have been accrued prior to the divorced couple being together.
Other pensions or superannuation
Input the annual amount of any other pensions or superannuation that the party received that have not already been included under another category (T1, Line 115).
Examples of "Other pensions or superannuation" include (ie. not exhaustive):
T4A slip, Box 16;
T3 slip, Box 31;
annuity and registered retirement income fund (RRIF), including life income fund, payments, if party is 65 or older, or if party is recipient because of death of spouse or common-law partner (T4A slip, Box 24 or Box 28; T4RIF slip, Box 16 or 20; T5 slip, Box 19);
gross amount of pensions from a foreign country (converted to Canadian dollars);
United States individual retirement account (IRA);
United States social security and Medicare premiums paid on party's behalf.
According to the CSG, annual income is determined using Line 150 ("Total income") of the T1 General form, adjusted in accordance with Schedule III and ss. 17, 18 and 19 of the CSG. This is commonly referred to as "Guidelines Income".
Note that the SSAG use the same definition of annual income as under the CSG, with some exceptions.
See the help under "Employment Income" regarding Guidelines Income caps under the CSG and ceilings, floors, and floor exceptions under the SSAG.
TIP: There is a built-in conversion feature. See the help under "Employment Income".
My Rebuttal:
I again reference my rebuttal to Old Age Security. It seems very unfair to me to include all this pension arbitrarily especially when the majority of it could have been accrued prior to the divorced couple being together.
Income Section - CPP Disability Benefit
This is what the Spousal Support Calculator says...
CPP Disability benefit
Input the party's total annual Canada Pension Plan (CPP) disability benefits (T1, Line 152; T4A(P) slip, Box 16). This amount should also be included in "CPP Retirement benefit".
According to the CSG, annual income is determined using Line 150 ("Total income") of the T1 General form, adjusted in accordance with Schedule III and ss. 17, 18 and 19 of the CSG. This is commonly referred to as "Guidelines Income".
Note that the SSAG use the same definition of annual income as under the CSG, with some exceptions.
See the help under "Employment Income" regarding Guidelines Income caps under the CSG and ceilings, floors, and floor exceptions under the SSAG.
TIP: There is a built-in conversion feature. See the help under "Employment Income".
My Rebuttal:
This is one of those moments which makes me wonder if Family Lawyers are truly mentally retarded.
This amount is already INCLUDED in Box 20 as detailed in my previous post so it is obviously EXCLUDED from the spousal support calculation.
If you notice on a T1, Box 152 isn't even included when calculating total income.
I decided to test it to make sure it isn't duplicating the disability benefit but sure enough it is. I'm sure all disabled people will appreciate knowing that this calculator will duplicate their CPP Disability payments throwing the calculation out by 100's of dollars per month.
If you are dealing with someone who is receiving a disability payment, enter it only once (either in this field or CPP Retirement Benefit field.
Will someone please hit me over the head with a hammer 10 times so I can lose 50 basis points in IQ and become a family lawyer. Thanks.
CPP Disability benefit
Input the party's total annual Canada Pension Plan (CPP) disability benefits (T1, Line 152; T4A(P) slip, Box 16). This amount should also be included in "CPP Retirement benefit".
According to the CSG, annual income is determined using Line 150 ("Total income") of the T1 General form, adjusted in accordance with Schedule III and ss. 17, 18 and 19 of the CSG. This is commonly referred to as "Guidelines Income".
Note that the SSAG use the same definition of annual income as under the CSG, with some exceptions.
See the help under "Employment Income" regarding Guidelines Income caps under the CSG and ceilings, floors, and floor exceptions under the SSAG.
TIP: There is a built-in conversion feature. See the help under "Employment Income".
My Rebuttal:
This is one of those moments which makes me wonder if Family Lawyers are truly mentally retarded.
This amount is already INCLUDED in Box 20 as detailed in my previous post so it is obviously EXCLUDED from the spousal support calculation.
If you notice on a T1, Box 152 isn't even included when calculating total income.
I decided to test it to make sure it isn't duplicating the disability benefit but sure enough it is. I'm sure all disabled people will appreciate knowing that this calculator will duplicate their CPP Disability payments throwing the calculation out by 100's of dollars per month.
If you are dealing with someone who is receiving a disability payment, enter it only once (either in this field or CPP Retirement Benefit field.
Will someone please hit me over the head with a hammer 10 times so I can lose 50 basis points in IQ and become a family lawyer. Thanks.
Income Section - CPP Retirement Benefit
This is what the Spousal Support Calculator says...
CPP Retirement benefit
Input the party's total annual Canada Pension Plan (CPP) benefits (T1, Line 114; T4A(P) slip, Box 20), including any CPP disability benefits .
According to the CSG, annual income is determined using Line 150 ("Total income") of the T1 General form, adjusted in accordance with Schedule III and ss. 17, 18 and 19 of the CSG. This is commonly referred to as "Guidelines Income".
Note that the SSAG use the same definition of annual income as under the CSG, with some exceptions.
See the help under "Employment Income" regarding Guidelines Income caps under the CSG and ceilings, floors, and floor exceptions under the SSAG.
TIP: There is a built-in conversion feature. See the help under "Employment Income".
My Rebuttal:
Box 20 Taxable CPP Benefits on the T4A(P) includes boxes 14, 15, 16, 17, 18 which are as follows:
Box 14 Retirement Benefit
Box 15 Survivor Benefit
Box 16 Disability Benefit
Box 17 Child Benefit
Box 18 Death Benefit
I agree that Box 14 and Box 15 should be included for spousal support purposes.
Box 16 Disability Benefit
I'll address this issue in my next blog. What a nightmare!!
Box 17 Child Benefit
This benefit is available to children once they turn 18 if they have a disabled parent. It is the childs income whether the parent receives it or not.
So there are two issues here.
1. If the spousal calculation is done for a child whose parent is disabled or
2. If the spousal calculation is done for a parent who is disabled.
My view is that since CRA deems that this is the childs money, under (1) it is included in income and under (2) it is excluded from income.
I think anyone with these circumstances should insure that the child receives the money and not the parent to prevent a parent from misusing the money
Box 18 Death Benefit
(Note sarcasm here) Great to know if you have a loved one that passes away, you will be gouged for spousal support when you probably use the money for funeral arrangements. Obviously EXCLUDED
CPP Retirement benefit
Input the party's total annual Canada Pension Plan (CPP) benefits (T1, Line 114; T4A(P) slip, Box 20), including any CPP disability benefits .
According to the CSG, annual income is determined using Line 150 ("Total income") of the T1 General form, adjusted in accordance with Schedule III and ss. 17, 18 and 19 of the CSG. This is commonly referred to as "Guidelines Income".
Note that the SSAG use the same definition of annual income as under the CSG, with some exceptions.
See the help under "Employment Income" regarding Guidelines Income caps under the CSG and ceilings, floors, and floor exceptions under the SSAG.
TIP: There is a built-in conversion feature. See the help under "Employment Income".
My Rebuttal:
Box 20 Taxable CPP Benefits on the T4A(P) includes boxes 14, 15, 16, 17, 18 which are as follows:
Box 14 Retirement Benefit
Box 15 Survivor Benefit
Box 16 Disability Benefit
Box 17 Child Benefit
Box 18 Death Benefit
I agree that Box 14 and Box 15 should be included for spousal support purposes.
Box 16 Disability Benefit
I'll address this issue in my next blog. What a nightmare!!
Box 17 Child Benefit
This benefit is available to children once they turn 18 if they have a disabled parent. It is the childs income whether the parent receives it or not.
So there are two issues here.
1. If the spousal calculation is done for a child whose parent is disabled or
2. If the spousal calculation is done for a parent who is disabled.
My view is that since CRA deems that this is the childs money, under (1) it is included in income and under (2) it is excluded from income.
I think anyone with these circumstances should insure that the child receives the money and not the parent to prevent a parent from misusing the money
Box 18 Death Benefit
(Note sarcasm here) Great to know if you have a loved one that passes away, you will be gouged for spousal support when you probably use the money for funeral arrangements. Obviously EXCLUDED
Income Section - Old Age Security Pension (OAS)
This is what the Spousal Support Calculator says...
Old Age Security pension (OAS)
Input the party's Old Age Security pension (T1, Line 113; T4A(OAS) slip, Box 18).
According to the CSG, annual income is determined using Line 150 ("Total income") of the T1 General form, adjusted in accordance with Schedule III and ss. 17, 18 and 19 of the CSG. This is commonly referred to as "Guidelines Income".
Note that the SSAG use the same definition of annual income as under the CSG, with some exceptions.
See the help under "Employment Income" regarding Guidelines Income caps under the CSG and ceilings, floors, and floor exceptions under the SSAG.
TIP: There is a built-in conversion feature. See the help under "Employment Income".
My Rebuttal
A full OAS pension is dependent on two categories:
Caregory (1) You lived in Canada for at least 40 years after age 18 or
Category (2) You reached the age of 25 on or before July 1, 1977, and at that time:
1. you lived in Canada, or;
2. you did not live in Canada but you had some residence in Canada after the age of 18, or;
3. you were in possession of a valid Canadian Immigration Visa; and
4. you lived in Canada for the 10 years immediately before the approval of your OAS application.
If you did not live in Canada continuously for the 10 years immediately before the approval of your application, you may still qualify for a full pension if you meet both conditions below:
• you lived in Canada for the entire year immediately before the approval of your application; and
• you lived in Canada (since age 18) for at least 3 years for every 1 year of absence from Canada during these last 10 years.
Partial Pension
A partial pension is calculated at the rate of 1/40th of the full pension for each complete year of residence in Canada since age 18.
The minimum period you need to qualify for a partial pension is 10 years of residence in Canada after reaching age 18 (as long as you live in Canada when you receive your OAS pension). In other words, if you lived in Canada for 10 years after your 18th birthday, you may qualify to receive 10/40ths or one-quarter of the full Old Age Security pension.
Once a partial pension is approved, we can never increase the number of years of residency on which your pension is based. You will however, qualify for any cost-of-living increases.
Now it seems to me that alot of this is dependent on living in Canada for a number of years. I find it unfair to include the whole pension arbitrarily.
Old Age Security pension (OAS)
Input the party's Old Age Security pension (T1, Line 113; T4A(OAS) slip, Box 18).
According to the CSG, annual income is determined using Line 150 ("Total income") of the T1 General form, adjusted in accordance with Schedule III and ss. 17, 18 and 19 of the CSG. This is commonly referred to as "Guidelines Income".
Note that the SSAG use the same definition of annual income as under the CSG, with some exceptions.
See the help under "Employment Income" regarding Guidelines Income caps under the CSG and ceilings, floors, and floor exceptions under the SSAG.
TIP: There is a built-in conversion feature. See the help under "Employment Income".
My Rebuttal
A full OAS pension is dependent on two categories:
Caregory (1) You lived in Canada for at least 40 years after age 18 or
Category (2) You reached the age of 25 on or before July 1, 1977, and at that time:
1. you lived in Canada, or;
2. you did not live in Canada but you had some residence in Canada after the age of 18, or;
3. you were in possession of a valid Canadian Immigration Visa; and
4. you lived in Canada for the 10 years immediately before the approval of your OAS application.
If you did not live in Canada continuously for the 10 years immediately before the approval of your application, you may still qualify for a full pension if you meet both conditions below:
• you lived in Canada for the entire year immediately before the approval of your application; and
• you lived in Canada (since age 18) for at least 3 years for every 1 year of absence from Canada during these last 10 years.
Partial Pension
A partial pension is calculated at the rate of 1/40th of the full pension for each complete year of residence in Canada since age 18.
The minimum period you need to qualify for a partial pension is 10 years of residence in Canada after reaching age 18 (as long as you live in Canada when you receive your OAS pension). In other words, if you lived in Canada for 10 years after your 18th birthday, you may qualify to receive 10/40ths or one-quarter of the full Old Age Security pension.
Once a partial pension is approved, we can never increase the number of years of residency on which your pension is based. You will however, qualify for any cost-of-living increases.
Now it seems to me that alot of this is dependent on living in Canada for a number of years. I find it unfair to include the whole pension arbitrarily.
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