Update to Child Support Guidelines in Canada, 2024, University of Toronto Press, December 2024, Irwin Law Imprint-- Child Support --Income

? Child Support—Determination of Income—First Nations Settlement -- NS v JSDR, 2025 YKSC 5, Duncan C.J.

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9)?? Exclusions from Income

Workplace Safety and Insurance Board payments and Canada Pension Plan disability payments constitute “income” under section 16 of the Federal Child Support Guidelines but the Child Tax Credit,[1] GST rebate, and any childcare subsidy do not constitute income under that section. Workplace Safety and Insurance Board payments should be grossed up to take account of their tax-free status.[2] An income tax refund is not income for the purpose of the Guidelines.[3] Settlement proceeds arising from wrongful dismissal are included in a spouse’s income under the Guidelines, after deductions have been made for legal fees and disbursements and for reimbursement of Employment Insurance benefits.[4]

Income signifies money or benefit received by way of entitlement; gratuitous benefits received from a church or family member should not be treated as income.[5] A government benefit for the respite care of a mentally challenged child is excluded from a parent’s income where the benefit is directly payable to the respite worker.[6]

A lump sum received for pain and suffering, as distinct from income replacement, under a personal injuries settlement does not constitute income for the purpose of the Federal Child Support Guidelines, although the interest earned thereon does.[7]

Repayment of a shareholder loan is not income under the Federal Child Support Guidelines,[8] but such repayment of capital may result in the judicial imputation of income on the basis that the capital asset is not being reasonably utilized to generate income within the meaning of section 19(1)(e) of the Guidelines.[9]

Dividend income that is received by a spouse on a periodic basis by way of property entitlement has been excluded from the calculation of the recipient’s income under the Federal Child Support Guidelines, notwithstanding that it constitutes income for taxation purposes.[10]

A settlement amount received by the Wahnapitae First Nation for the cost of acquiring reservation lands and paid out by the Chief and Council to each eligible First Nation member was excluded in calculating a parent’s income for the purpose of determining the amount of child support payable under the Child Support Guidelines.[11] Chief Justice Duncan, of the Yukon Superior Court, observed:

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[26]?? ?? I do not accept the plaintiff’s argument that these monies are income. Income for the purposes of the Child Support Guidelines, is defined in s.?16 as the sources of income set out under “Total Income” in the T1 General issued by CRA. This kind of compensation payment is not included in the T1 form. In situations where courts have exercised their broad discretion to find that non?taxable funds, such as this, received by a payor are income under the Child Support Guidelines, those funds bear some relationship to “work done or through investments, or [they are] paid as compensation to which the payor is legally entitled when deprived of such work or investments” (Rivard v Hankiewicz, 2007 ONCJ 180 at para.?41).

[27]?? ?? For example, workers’ compensation benefits, damages for copyright infringement representing royalties on the payor’s original music compositions (Mobin?v?Stephens, 2013 ONCJ 53), Canada Pension Plan disability payments, and damages from a personal injury settlement for loss of earning capacity have all been considered income for the purpose of Child Support Guideline calculations. Conversely, child tax credit, GST rebate, childcare subsidy, repayment of a shareholder loan, and damages from a personal injury settlement providing for non?pecuniary loss and cost of future care have been found not to constitute income under the Child Support Guidelines.

[28]?? ?? In this case, there is no connection between work or employment and the settlement monies. Compensation from a legal settlement for a wrong done to a collective asset and a decision by Chief and Council to do a per capita distribution of some of it does not fit the definition of income either under the T1 General or the Child Support Guidelines.

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[1]????????? Compare Mullins v Mullins, 2016 ABQB 226 at para 9, Jeffrey J.

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[2]????????? DAT v SLP, 2018 NBQB 135. See also Dahlgren v Hodgson, [1998] AJ No 1501 (CA); Mullins v Mullins, 2016 ABQB 226; Dedoscenco v Beauchamp, [2005] BCJ No 1053 (SC) (CPP and WCB disability pensions grossed up; WCB personal care allowance not grossed up); MS v EJS, 2017 BCSC 564; Prince v Soenen, 2015 MBQB 31; Callahan v Brett, [2000] NJ No 354 (SC) (workers’ compensation benefits and private disability pension); Coadic v Coadic, [2005] NSJ No 415 (SC); Peterson v Horan, [2006] SJ No 333 (CA); SMM v DPG, [2003] YJ No 98 (SC). Re gross up of workers’ compensation, compare Landry v Landry, 2012 ONSC 7187 at para 5; see also Storey v Simmons, 2013 ABQB 168 and compare Starling v Starling, 2016 SKQB 112 (spousal support).

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[3]????????? Rapoport v Rapoport, 2011 ONSC 4456; see also Dahlgren v Hodgson, [1998] AJ No 1501 (CA); Flanagan v Heal, [1998] SJ No 805 (QB) (child tax credit).

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[4]????????? Griffin v Griffin, [1999] BCJ No 397 (SC).

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[5]????????? Booth v Booth, [2000] BCJ No 2544 (SC).

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[6]????????? Moulson v Graves, [2002] OJ No 2582 (SCJ).

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[7]????????? Tibbo v Bush, [2000] NSJ No 352 (Fam Ct) (issue left unresolved as to whether the capital settlement constituted “means” that might justify an order under s 7 of the Guidelines in the absence of any order for the table amount of child support).

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[8]????????? Rudachyk v Rudachyk, [1999] SJ No 312 (CA). For a nuanced review of relevant caselaw, see CRP v NDP, 2023 NBKB 197 at paras 247–66, Colford J.

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[9]????????? Waese v Bojman, [2001] OJ No 2009 (SCJ); see also JR v NR, 2017 BCSC 455; CRP v NDP, 2023 NBKB 197.

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[10]??????? Dunham v Dunham, [1998] OJ No 4758 (Gen Div). Quaere whether this conclusion is consistent with ss 15 to 20 of the Federal Child Support Guidelines.

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[11] ?????NS v JSDR, 2025 YKSC 5.