What the New Canada Child Benefits Will Mean for Divorced Parents
Canadian families who have dealt with divorce often experience additional complications with shared custody. In addition to scheduling visits and distributing parental duties, divorced couples have to determine the numbers in terms of child benefits and child support.
New programs implemented for families by the government usually results in some sort of change to the way funds are distributed. The most recent changes to federal child benefits promised to grant additional financial support. However, parents who are separated or divorced may end up having to go to court to settle federal child benefit issues brought up by legislative changes.
Good Intentions May Lead to Potential Problems
While the conflation of family support programs such as the universal child care benefit and the child tax benefit may appear to simplify matters, the new legislation hasn’t been crafted to provide clear-cut rules for certain types of parents. The previous programs mentioned include a detailed set of instructions that guide the disbursement of the money. The new program, which takes the place of three, has no specific law set up to determine how benefits are paid for divorced parents.
As a result, about 1.2 million Canadians have no guidance in terms of how to calculate spousal support or split tax deductions amongst themselves. Due to the lack of concrete legislation, it’s expected that more changes are likely to be upcoming, as they attempt to rectify perceived problems with the program. Similarly, there’s a good chance that some divorced parents will experience legal strife because of the lack of regulation, which leaves the law open to interpretation.
Considering that divorce is already a contentious issue, courts may witness a significant uptick in cases as divorcing spouses argue why they deserve the government benefit more than their spouse.
Who Gets the New Benefits?
While the amount that families receive becomes reduced when the household earns $30,000 or more, this plan should ideally help those who need it the most, especially single-parent families who struggle to make ends meet.
Canada’s “new $23-billion-a-year benefit will replace three different programs on July 1 with one income-tested payment”, distributed to families on a monthly basis.
According to the government, this new program will help to lift more than 300,000 children out from under the poverty line, while providing more money for 90 percent of all families who take advantage of government child benefits. Families which will benefit the most are those which earn less than $30,000 a year. This group will receive $6,400 per year for each child five years of age or less and $5,400 yearly for children six and older.
Family Legal Experts Help You Navigate New Law
In certain cases, even if a legal agreement was reached between divorced spouses, the new legislation set into place will cause government authorities, such as the Canada Revenue Agency, to apply the new law instead of facilitating the previous agreement. The reason for this is simple: the CRA must abide by the Income Tax Act, which guides the entire organization. If your agreement is contra to how the CRA works, your pact will be considered irrelevant.
Experts in family law can help keep you informed of these types of changes in legislation, preventing you from dealing with unwanted financial surprises.
Fine & Associates Professional Corporation is a well-respected Toronto Law Firm that prides itself on providing quality personal service and favourable outcomes in Family Law and Divorce Law.
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