Tax Time

April is known as the month most of us have to ensure we get our personal income tax returns filed. It also is the time for some reminders from your family law lawyer.

First, if you have an active file with a lawyer relating to a separation or parenting issues, make sure you give your lawyer a copy of your tax return when it is complete as well as the Notice of Assessment you receive from CRA. Instead of waiting for requests to come from either or both lawyers, simply emailing or dropping off a copy of the return to make sure it is available will save you money.

Second, if you have a child and child support is in issue, both parents should exchange income tax returns and take a look at whether the support should be changed. The courts have decided that parents owe an obligation to their children to make sure the support remains reasonable and consistent with the Child Support Guidelines. 

Third, if you are separated or divorced and have a child, be sure that CRA knows the child's parenting time schedule in order that the Canada Child Benefit can be paid in accordance with their rules. If one parent is collecting the full CCB but CRA later determines that the benefit should have been shared, CRA will demand repayment.

Fourth, if periodic spousal support is being paid, the spouse receiving the payments must make sure to claim any and all monthly amounts they received in the previous year. The spouse paying spousal support can claim the payments as a tax deduction but should ensure they have provided a copy of the Separation Agreement or court Order to CRA as well as having proof of the actual payments made.

Lastly, some legal fees can be tax deductible depending upon their purpose. If your accountant tells you that your fees may qualify, be sure to ask your lawyer for a printout of total fees for the year and a letter confirming what they were for.

Jodi L. Wyman, B.A., LL.B.