Let's talk about child support calculations

Child support calculations — not just a data entry function

Let's talk about child support calculations

This article was provided by ChildView Inc.

Child support is more than just a simple table look up. To some this may seem a bold and challenging statement. While it might be easier to live in a world where fair and equitable child support could be completely captured by a simple generic table, families are neither simple nor generic. Support calculations need to reflect the complex needs of the families involved.

In Canada, child support is governed by the Federal Child Support Guidelines (FSCG) and the related provincial and territorially counterparts, which substantially mirror the FSCG. Despite the fact that these rules have been in place since 1997, more than 24 years ago, myths and misconceptions regarding the calculations are still common. The view that child support is merely a simple table look up based on line 150” (or line 15000, as it is now numbered) is still prevalent and encouraged by the surfeit of online calculators that have cropped up over the years. Many of these ask for minimal information and spew out unsupported results or use a layered approach where the more you pay the more detail you are supposed to receive. How this is possible with minimal input is a question. While they may produce a reasonable result some of the time in the most simplistic situations, they often create unrealistic expectations when the results are inaccurate.

To some extent the goal of these simple calculators is to help unrepresented parties through one aspect of a potentially messy relationship break-down and the subsequent legal obligations. However, these simplistic calculators not only fuel these misunderstandings, but may make unfounded claims of accuracy without any disclosure of the built-in assumptions and basis for their calculated results, which does a disservice to those they purport to help.

A child support calculation is not just a data entry function using a piece of software.  It is a decision making process. Child support calculations and the support orders or agreements that include them do not operate in a vacuum. Of course there are financial implications due to the payment and receipt of the support, but there are also potential tax and government benefit implications that get ignored to the determent of the parties involved. It’s not just a matter of asking if there are children, but of understanding the parenting arrangement and how that arrangement is treated under the Income Tax Act (ITA). The implications for the government benefits alone may be in the tens of thousands of dollars. Ignoring details such as this is like saying a jumbo jet can be flown by clicking a button and flicking a switch. Do you want to be a passenger on that plane with that pilot? A discussion on the role of government benefits and their implications in child support calculations may be found on the ChildView website in the Let’s Talk About” article: Government Benefits and the Child Support Guidelines.”

Without sufficient information you can’t determine if the situation really only requires a simple table look up.” Are there times when a simple table look up will suffice? Of course, but enough information needs to be considered to make that decision. Make no mistake — this is a decision. Simply knowing the province of the payor, the number of children for whom support is sought and some kind of income figure is not enough to make that decision. A lack of understanding regarding the correct determination of Guideline income only exacerbates the expectation gap created by the use of these simplistic tools.

So what types of decisions need to be made? To begin with, an understanding of the parenting arrangement is needed and decisions must be made on how that should be reflected in the set up of the scenario. If it is a shared parenting arrangement, how does that translate into the claiming of tax credits and government benefits under the ITA?  What is the composition of each household? Does either party have a new partner or other children in the household? Not even asking these questions is, in itself, a decision — a decision to ignore the potential effect on calculations such as child support from section 7 of the Guidelines or a spousal support range. Should child support go beyond the table amount? Given the reality of the family situation, are there opportunities in the Guidelines to vary the table amount? What sources of income are relevant in determining current Guideline income? What adjustments should be made to the initial assessment of income as directed by Schedule III of the Guidelines? These questions and more all require decisions that will affect the calculations and the results. Calculators that do not ask for any input about these areas are making the decisions for you without having any of the facts on which these decisions should be based and without allowing any adjustment where the built-in decisions are wrong. Informed decisions need information. Calculators need input fields to address and utilize that information and produce results that reflect the conclusions which you have made.

So, when it comes to a child support calculation, is something better than nothing? Perhaps, but there is a reason that software, such as the ChildView program, was developed. It is designed to handle everything from the simple to the most complex situation; to address all those questions and allow the user to make the most appropriate decisions specific to each scenario. Along with the ChildView software’s ability to handle any calculation complexity, their online workshops provide insight into these decisions and their effects on the calculations and results. For more information, please visit childview.ca.

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