In this Appendix, for those who want to know, we provide the details of
how calculations are done under the basic with child support
formula and how the spousal support numbers in the examples were
generated. Some calculations were done with the benefit of current
computer software. Some others had to be done manually, by iteration or
trial and error. In completing these sample calculations, we have used the
DIVORCEmate software and its terminology (although the numbers are almost
identical using ChildView, even if the terms differ.) Once software
developers have made the necessary programming changes the calculations
required by this formula will be much easier.
For the purposes of this explanatory appendix, we will use the numbers
from Example 6.1 involving Ted and Alice who reside in
Ted will pay the Ontario table amount for child support, $1,031 per
month. For simplicity, we assume there are no s. 7 expenses.
(1) Determine the Guidelines incomes of the spouses
We start with the Guidelines income of each spouse, essentially a
gross income measure. Tedís gross employment income is $6,667 monthly
($80,000 per year), Aliceís is $1,667 monthly ($20,000 per year).
(2) Deduct child support from the payor spouseís
Ted will pay child support of $1,031 per month for two children using
the Ontario table amount. There are no s. 7 expenses and hence no
contributions. The computer software automatically deducts Tedís child
support payments from his net disposable income.
(3) Deduct child support amounts from the recipient
The software includes Tedís child support payment in Aliceís net
disposable income, which is why we call this her family net
disposable income. To obtain Aliceís individual net disposable
income, our first step must be to back-out or subtract this child
support amount from Aliceís net disposable income.
But that is not enough. Alice also contributes to the support of the
two children, directly through expenditure of her own net income. In a
formula, we have to capture that amount and we use Aliceís
notional table amount as a proxy measure for that contribution,
as is explained in Chapter 6.
In this case, that amount would be $285 monthly, for two children, on an
Ontario income of $20,000. Thus, a second amount must be backed out or
deducted on Aliceís side, this notional table amount of $285. If there
were s. 7 expenses, we would also have to deduct Aliceís
contribution to those s. 7 expenses. These amounts have to be
deducted manually, as the current software does not do this.
(4) Do not deduct government benefits and refundable
credits from the spousesí incomes
After some uncertainty, we decided not to deduct government
benefits and refundable credits from the spousesí incomes. These
amounts are automatically included in the family net disposable incomes
used by the software. For the most part, in practical terms, this means
we did not deduct these amounts from the recipient spouseís income. As
for payors, only low-income payor spouses obtain any of these (basically
the GST credit) and most of those low-income spouses will not be paying
We did consider backing out the child portion of these benefits,
since most of these benefits are tied to the children in the recipient
spouseís care, e.g. the Child Tax Benefit, part of the GST credit and
the various provincial programs. For the reasons explained in Chapter 6,
we decided not to do so.
In our case, only Alice has such benefits. If only the table amount
of child support were paid and no spousal support, Aliceís government
benefits and refundable credits would be $492 monthly ($5,900 annually).
By contrast, at the upper end of the spousal support range, $1,287
monthly, those benefits and credits are reduced to $230 monthly.
(5) Deduct income taxes and other deductions from each
The software automatically deducts income taxes and other
deductions from each spouseís net disposable income, adjusting for
the amount of spousal support transferred. Federal and provincial income
taxes are calculated, as well as employment insurance premiums and
Canada Pension Plan contributions. In our example of Ted and Alice,
there are no deductions other than these statutory deductions. Other
permissible deductions are discussed in Chapter 6.
This step and the next step are actually done together, as taxes and
other deductions will vary as we iterate to obtain the appropriate
division of individual net disposable income for spousal support
(6) Determine the spousal support required to divide
The next step is to determine the amounts of spousal support required
to leave each spouse with the desired amount of individual net
disposable income (INDI) at each end of the formulaís range, either
46/54 at the upper end or 40/60 at the lower end.
We can start with the calculation at the upper end of the range. On
the payorís end, the software deducts child and spousal support and
adjusts taxes for various proposed amounts. On the recipientís end,
however, the child support amounts (each spouseís) have to be subtracted
manually, but the software adjusts taxes as well as government benefits
and refundable credits.
Ted starts with a gross income of $6,667 monthly. Out of that will
come $1,031 child support, an estimate of $1,287 spousal support, $1,226
in taxes, $217 in EI/CPP deductions, leaving a net monthly disposable
income of $2,906. The software does all of these calculations
automatically. This amount is also Tedís individual net disposable
Aliceís family net disposable income is shown as $3,792 monthly for
herself and the children. Her gross monthly income is $1,667, plus child
support received, at $1,031, plus spousal support at $1,287, less taxes
of $322, plus benefits and credits of $230, less EI/CPP of $101. To
obtain Aliceís individual net disposable income, we have to deduct child
support paid by Ted of $1,031 and then deduct her notional table amount
of $285, which leaves Alice with $2,476 monthly.
If we add together the individual net disposable incomes of Ted
($2,906) and Alice ($2,476), the total is $5,382. Aliceís share would be
$2,476, or 46 percent of the total INDI of $5,382.
Here I have used the final spousal support figure of $1,287, but that
number was only obtained by iterating, by trial and error, until the
right result is obtained. This process is no different from what the
spousal support calculator does with family net disposable income in the
For Ted and Alice, the low end of the range turns out to be $697.
According to the software, at that amount of spousal support, Tedís net
disposable income is $3,283 monthly. The software shows
Aliceís family NDI as $3,505. But Tedís child support of $1,031 and
Aliceís notional table amount of $285 have to be deducted, to leave
Alice with an individual net disposable income of
$2,189 monthly. This would leave Alice with $2,189, or
40 percent of the total individual net disposable income of