In the past few years, I received an employment bonus at the end of the year. I have no control whether I get it or not. It seems unfair to pay monthly child support based on my previous year’s income including the bonus if I haven’t received it yet this year. I’ll pay it when I received it.

(1) The Legal Test

A general misconception is that family law provides answers to questions. It usually doesn’t. The law provides legal tests – frameworks – to assess the merit of an argument. The test is either detailed in the legislated law, or created by a judge facing the same argument. Then, the test may be adopted by other judges in subsequent similar disputes. 

For this issue the legal test is:

1. Whether paying support based on the bonus when the bonus is received ensures that the recipient is not being paid too little or too much, and avoids significant adjustments later on.

2. Whether there is any guarantee that the payor will receive any bonus.

3. The support-payor’s cash flow, including (depending on the arrangement) interim tax installments owed to CRA.

4. Whether both of the parties should bear the cash flow burden.

5. Whether there is demonstrated “need” by the support-recipient for the additional amount of support each month to meet expenses.

(2) Full Disclosure

Now that you see the test, you can start to compile documents to support your claim:

  • Employment Contract, stating qualifications for bonus 
  • Employer letter, stating qualifications for bonus and likelihood of bonus in the current year
  • Evidence that you are arms-length from your employer, i.e. you don’t have any control over the entitlement or timing of a bonus payment
  • Prior year’s final pay-stubs, itemizing base income and the prior bonus, to calculate a ratio of base to bonus
  • A cogent Family Law Financial Statement budget, showing effect on cash flow
  • Any interim tax bills or other expenses, demonstrating strain on payor’s cash flow or special ‘need’ of the recipient/children
  • Any expenses paid by the support-payor that addresses the support-recipient or children’s needs. 

(3) Source

Disclaimer:

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