The Canada child benefit (CCB) is a tax-free, income based monthly payment made to eligible families to help with raising children under 18 years of age.
To be eligible, you must meet citizenship and residency requirements, and you must be primarily responsible for the care and upbringing of a child or be in a shared parenting arrangement as defined by the CRA. When parents live together, the primary caregiver receives the CCB payments if they qualify as an eligible individual under the Income Tax Act (ITA). The ITA presumes that the primary caregiver is the female parent.
The maximum benefit received for children under 6 years is $6,833 per year ($569.41 monthly) and $5,765 per year ($480.41 monthly) for children ages 6 to 17 years. The amount received is reduced for adjusted family net incomes over $32,028.
What you need to know after separation.
Sometimes a parent can find themselves in a situation where the other parent improperly claims that a child is primarily with them or improperly reports a shared parenting arrangement. You may find yourself in a situation where you must prove the parenting arrangement or worse, have your benefit amount reduced while you dispute the change. If the other parent makes a retroactive parenting claim, parties can be shocked to find a debt owing to CRA. This can be quite stressful for parents depending on the benefit.
If parents separate and a child is only seeing one parent that tends to be a simple scenario to substantiate. However, the waters get muddied in cases of shared parenting.
What is a shared parenting arrangement?
CRA states that shared parenting is defined as at least 40% with each parent or “about” equal time. The problem is how do you count parenting time? Is it hours? Is it days? Does the time the kids are at school count? The ITA does not provide guidance on this calculation. If two different parents count their time differently, they may have different results and parents will have to prove their parenting arrangement to CRA.
Issue with having to prove a parenting arrangement.
The CRA does its own analysis on parenting time and often parents are surprised to learn that a Separation Agreement or Court Order alone may not suffice. In addition to an Agreement or Order, the CRA lists numerous items that a parent can submit as evidence of the parenting arrangement.
- CRA will accept a letter from the child’s nursery or school showing the contact information on file for the child. Additionally, they will accept a child’s report card, school registration form or emergency contact. However, if both parents have decision-making authority (formally custody) or parenting time, both parents are likely listed as contacts without this having any bearing on parenting time.
- Parents can also submit a letter from the family doctor or dentist confirming the child is under their care and who the child lives with. However, issues often arise where healthcare providers are reluctant to become involved in what they may deem to be a “custody dispute”. Furthermore, parents can have arrangements where the parent responsible for taking a child to the doctor or dentist does not have shared parenting time.
- Similarly, to the second point, CRA will accept a registration form or a receipt from an activity the child was enrolled in but again, this may not be evidence of shared parenting but rather, may simply be a financial arrangement.
While the unreliability of these items as evidence of parenting arrangements is highlighted above, parents are often surprised to learn that do not have access to what the other parent has submitted. This makes it difficult for a parent to speak to potential inaccuracies of information submitted. Furthermore, most parents do not wish to engage professionals whose primary purpose is to educate or care for their children into a dispute over benefits.
What is the Answer?
There is no clear-cut answer to the dilemma that numerous parents are bound to face until the ITA catches up with more fulsome and appropriate legislative guidance that better reflects parental unit norms today. In the interim:
- Notify CRA of any changes in parenting arrangements within 90 days;
- Maintain records of any supporting documentation that might be needed if you must prove your parenting arrangement; and
- Reach out to a lawyer if you need legal assistance.