Married spouses (and, in certain circumstances, common-law spouses) have a duty to support each other. In determining the amount and duration of support the court applies a broad discretion within an area loosely defined by a number of criteria. This gives the law of spousal support a sometimes vexing degree of unpredictability. To address this problem Spousal Support Advisory Guideline have been designed as a "check," or "litmus test," or "tool," to assist the court and the parties to arrive at proper spousal support terms. The "advisory" nature of these guidelines must be emphasized. They are not "presumptive" like the Child Support Guidelines, and, therefore, do not have the same authority or certainty of application. The law for determining spousal is shaped around certain factors and objectives set out in family legislation. The "factors" consist of the means, needs and other circumstances of each spouse, including (a) the length of time the spouses cohabited and (b) the functions performed by each spouse during cohabitation. The "objectives" of spousal support to be considered are those which
"(a) recognize any economic advantages or disadvantages to the spouses arising from the marriage or its breakdown;
"(b) apportion between the spouses and financial consequences arising from the care of any child of the marriage over and above any obligation for the support of any child of the marriage;
"(c) relieve any economic hardship of the spouses arising from the breakdown of the marriage; and
"(d) in so far as practicable, promote the economic self-sufficiency of each spouse within a reasonable period of time."
The effect of these factors and objectives is to create two elements as a basis for spousal support: (1) compensation and (2) need. The opposite side of the coin to these elements, and equally important, is the ability of the other spouse to pay support. Where property has been acquired during the marriage the compensatory element may be satisfied by the fruits of the property division. (See question on property division, below.) Assuming satisfaction of the compensatory element, whether or not one spouse is obligated to support the other depends largely on the applicant spouse showing a need for support on his or her part, and a corresponding ability on the part of the other spouse to pay support. In weighing needs, the applicant spouse must first look to his or her own resources. These include his or her own ability to earn an income from employment, and the investment potential of any payment received in the property division. Generally speaking, it is when these resources fail to make the applicant self-sufficient, that spousal support is payable. In this sense, spousal support is an income supplement to make up for a shortfall between the amount needed to maintain a reasonable standard of living, and the amount generated by the applicant's own resources. The income tax treatment of spousal support is an important consideration. The deduction/inclusion rule applies which allows amounts paid for spousal support to be deducted by the payer spouse from income for the purpose of calculating tax, and whether or not this deduction is made, the amount for spousal support must be included by the recipient spouse in income for tax purposes.
Gary Joseph and Michael Stangarone are lawyers with Toronto's MacDonald & Partners family-law firm.
Certified Divorce Financial Analyst
Business Valuators / CPAs