How Do Alimony Payments Work in Canada

Alimony, partner support, spousal support – whatever you call it, this is one of the hottest topics and a major point of contention between spouses. Some separated partners believe that their former spouses receive this money for doing nothing, whereas their counterparts think that they are entitled to obtain sufficient amounts of money every month. 

Are you ready to understand the legal principles of how to calculate alimony and when this type of support should be paid? Keep on reading to find out the answers.

What Is Alimony?

Alimony is also called spousal support. When one separated spouse makes more money than the other one, he or she might need to pay alimony even if it means taking payday loans Canada to afford that monthly payment. There is no one-size-fits-all answer to the sum of alimony that should be paid in this case. Every situation is different and every case is unique. There are some guidelines on this topic that need to be followed by lawyers and judges.

You should take into account the fact that spousal support isn’t based on gender. Both women and men may need to pay alimony. However, men pay spousal support more frequently. Yet, the judge will most likely make their decision based on other factors rather than gender though women are considered more economically dependent on their husbands.

Entitlement

According to the results from the most recent survey of Maintenance Enforcement Programs, there were 95,200 child and spousal support cases registered with MEPs in those jurisdictions, down 1.8% from the previous year.

A spouse should prove entitlement to alimony before they obtain it. The Supreme Court of Canada has determined the following entitlements to alimony:

• Contractual Support. It means you have an agreement that defines the fact that one partner must obtain support. This agreement may be cohabitation, prenuptial, separation, etc. In this case, the spouse will need to pay due to their obligations.
• Compensatory Support. The idea behind this type of alimony is that one partner shouldn’t have a financial burden that is disproportionate as a result of the role that this partner adopted during the relationship. Compensatory support may happen in case one partner has forgotten education or career because of their role in the relationship.
• Non-compensatory Support. When one partner faces a serious financial shortfall as a result of the breakdown of the relationship, this type of support may occur. It means one partner shouldn’t face a significant reduction in their living standard because of them becoming self-sufficient due to the breakdown.

How Alimony Is Determined

Several factors are taken into consideration when determining the amount of alimony. These factors may include the parties’ incomes, assets, health, ages, ability to be self-sufficient, the standard of living, length of the marriage, etc. 

The court will check and review various economic factors that might influence their decision. Specific emphasis will be put on the financial circumstances of both spouses. After that, the family income will be apportioned in a fair way between both parties.

Do I Have to Pay My Former Spouse?

Unlike child support, alimony or spousal support isn’t automatic. If there is property to be divided between former spouses, it is permitted and encouraged to discuss spousal support as well. If you are willing to get rid of the need to pay ongoing alimony every month, you may pay spousal support in a lump sum payment provided that there is enough equity available. 

Pay attention to the fact that monthly support is tax deductible for the spouse paying. On the other hand, lump sum payment isn’t tax deductible. Hence, taxes present another factor for you to consider before you choose the most suitable option.

How Long You Should Pay Alimony

Judges do not put a time limit on spousal support for former partners who were in longer-term relationships, especially those with children. It doesn’t necessarily mean that the other partner will have to pay alimony for the rest of their lives. 

It means the judge won’t gaze into a crystal ball to see the financial stability of your spouse in the future. Once the financial situation of the former partner changes or he or she retires, it’s possible to return to court and ask for a change in the amount of spousal support you pay.

The amount of spousal support is generally time limited in a short-term relationship, especially without children. The so-called “review order” is a kind of alimony that is becoming more and more popular. It means the judge will state that the sum of spousal support may be reviewed and changed after several years. 

This is a suitable solution for many former partners who would like to go back to court and alter the amount of alimony without the need to show that their partner’s financial situation has changed. On the other hand, it doesn’t mean the amount of alimony will be changed.

Spousal Support Guidelines

Some significant things to note about the sum of spousal support awarded:

• When one kid is living with the alimony recipient, the recipient generally receives 45-50% of the family’s net disposable income.
• Where no child support is paid, the recipient spouse’s income was 36.6% to 44.5% of the families’ net disposable income.
• When two kids are living with the alimony recipient, the recipient generally gets about 55% of the net disposable income of the family.
• For higher incomes (family income of over $150,000 per annum), the sum of alimony will typically be lower.
• A lower sum of spousal support will be ordered if the spousal support recipient is not making good efforts to make an income.
• A higher sum of alimony is awarded if the spousal support payor doesn’t voluntarily begin paying spousal support away. Similarly, if a payor voluntarily pays the spousal support straight away, he or she will be awarded a lower sum of alimony.

Conclusion

In conclusion, you may utilize special software that judges and lawyers have access to if you want to calculate the sum of spousal support payable under the Spousal Support Guidelines. 

It’s necessary to turn to the family law lawyer if you have further questions as this information isn’t available to the general public. Keep in mind that the calculation of alimony will be slightly different in each Canadian province.