Shared Child-Related Expenses
Section 7 Special or Extraordinary Expenses
Have you ever wondered how separated parents share child-related expenses such as private school, daycare, extracurriculars (i.e. dance, sports, tutoring, etc.), and post-secondary expenses?
Under the Federal Child Support Guidelines (“the Guidelines”), there are two components to child support:
- Table child support; and
- Section 7 special or extraordinary expenses.
The Guidelines recognize that the Table amount of child support may be insufficient to cover the costs of certain expenses. Accordingly, when spouses separate they are permitted to request support over and above the Table amount to cover additional expenses for their children.
Special or extraordinary expenses include the following:
- Child care expenses;
- Portion of medical and dental insurance premiums attributable to the child;
- Health related expenses that exceed insurance reimbursement (i.e. orthodontics, counselling, therapy, etc.);
- Extraordinary expenses for primary or secondary school (i.e. private school);
- Post-secondary expenses; and
- Extracurricular activities.
Generally speaking, parents share special or extraordinary expenses in proportion to their respective incomes. For example, Mark and Debra have recently separated. If Mark earns an annual income of $70,000.00 and Debra earns an annual income of $100,000.00, the presumption is that Mark will owe 41.2% of the children’s section 7 expenses and Debra will owe 58.8%.
In determining whether an expense qualifies as being “special or extraordinary”, the Courts will engage in a two-part test to determine necessity and reasonableness. First, the expense must be necessary in relation to the child’s best interests. Second, it must be reasonable in relation to the means of the spouses and the child, and to the family’s spending pattern prior to separation.
With respect to extraordinary expenses for primary or secondary school and extracurricular activities, the expense must also be “extraordinary.”
If an expense is more than a spouse could reasonably be expected to cover, taking into account the recipient spouse’s income and the amount of Table child support being paid, the expense is considered “extraordinary”. However, even if an expense doesn’t meet the two-part test, an expense may still be considered “extraordinary” if a court deems it to be extraordinary after considering the following additional factors:
- The nature and number of the educational programs and extracurricular activities;
- Any special needs and talents of the child or children;
- The overall costs of the programs and activities; and
- Any other similar factor the court considers to be relevant.
As such, expenses are less likely to be considered “extraordinary” for higher income families, as additional expenses are more likely to be covered by Table child support. For example, if Paul earns $200,000 and is required to pay Paulina $3,428 per month in Table child support for three children, Paulina would be less likely to require additional amounts for the children’s soccer, as such expense can likely be covered by Table child support.
For post-secondary educational costs, it is not uncommon for the courts to order that a child must also contribute towards such costs. The child’s contribution varies from case to case and depends upon whether the child is completing a first or second post-secondary degree, the child’s means (including savings, income from summer employment, trust funds, bursaries or scholarships, etc.), and the parties’ means.
For more information on section 7 expenses and your obligation to contribute, contact Morrison Williams today to schedule a family law consultation.