{"id":19118,"date":"2023-03-06T15:00:00","date_gmt":"2023-03-06T20:00:00","guid":{"rendered":"https:\/\/www.verreaudufresneavocats.com\/?p=19118"},"modified":"2026-04-24T15:00:56","modified_gmt":"2026-04-24T19:00:56","slug":"child-support-calculation-income","status":"publish","type":"post","link":"https:\/\/www.verreaudufresneavocats.com\/en\/publications\/family-law\/child-support-calculation-income\/","title":{"rendered":"Calculating Child Support: Which Income Counts"},"content":{"rendered":"\n

In family law, when it comes time to calculate child support<\/a>, several factors come into play, including the income of the people involved. What can you do when a parent\u2019s reported income does not reflect their real income? What are the different scenarios that affect the child support calculation? Our family lawyers<\/a> in Qu\u00e9bec City and L\u00e9vis explain.<\/p>\n\n\n\n

Reported income versus real income<\/strong><\/h2>\n\n\n\n

It is commonly believed that child support is calculated only on the basis of the income each parent reported to the tax authorities for the previous year. In fact, the rules are more complex.<\/p>\n\n\n\n

Reported income<\/strong><\/h3>\n\n\n\n

As a general rule, the income used to calculate child support is indeed the income reported to the tax authorities. This applies, for example, when the parent is an employee and receives no fringe benefits from their job. This is the simplest scenario.<\/p>\n\n\n\n

Real income<\/strong><\/h3>\n\n\n\n

In other situations, a parent may have notional income imputed <\/em>to them for the purpose of calculating child support. Imputing income is necessary when a parent\u2019s reported income does not reflect their real income.<\/p>\n\n\n\n

Do you have questions about your situation? Contact one of our family lawyers today.<\/p>\n\n\n\n

Contact a lawyer<\/span><\/a><\/div>\n\n\n\n

Special cases<\/strong><\/h2>\n\n\n\n

Business shareholders<\/strong><\/h3>\n\n\n\n

There are several tax advantages that lead individuals to incorporate. For example, when a parent owns a business, they may decide, for tax reasons, to pay themselves a lower salary and leave the profits in the corporation. The corporation would then have significant amounts in retained earnings. In practice, a portion of these earnings could be imputed to the parent\u2019s personal income.<\/p>\n\n\n\n

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The extensive case law on this issue shows that the courts may impute between 5% and 100% of a business\u2019s retained earnings to the parent\u2019s income. Each case must be analyzed based on its circumstances.<\/em><\/p>\n<\/blockquote>\n\n\n\n

The courts will also analyze the various benefits that a parent who owns a business may enjoy. Examples include using a vehicle registered to the business, or using the business credit card for everyday expenses such as groceries, personal purchases or travel. The value of these benefits could be converted into income.<\/p>\n\n\n\n

<\/p>\n\n\n\n

Self-employed workers<\/strong><\/h3>\n\n\n\n

For tax purposes, self-employed workers can reduce their income through deductible expenses. However, not all expenses that are deductible for tax purposes are eligible when determining a parent\u2019s income to calculate child support. In practice, certain deductions considered personal, meaning expenses that were not used to operate the business, may be added back to a parent\u2019s income.<\/p>\n\n\n\n

Employees who receive various benefits<\/strong><\/h3>\n\n\n\n

Similarly, when a parent is an employee and works for a company that offers them several fringe benefits, the value of these benefits could be converted into income. Examples include:<\/p>\n\n\n\n