Please note that the information provided herein is not legal advice and is provided for informational and educational purposes only.  If you need legal advice with respect to getting, varying, or terminating child support in Ontario, you should seek professional assistance (e.g. make a post on Dynamic Lawyers).  We have Toronto, Ottawa, Brampton, Hamilton, and other Ontario family law lawyers registered on Dynamic Lawyers who can offer information, advice, and assistance with respect to helping you get, vary, or terminate child support.

As a follow up to my recent blog about child support obligations in Ontario and limitations on that obligation, in this blog, I’ll be discussing what the relevant time period is for determining a parent’s ” income” for the purpose of paying child support (note: this blog won’t deal with the timeline for determining income in respect of retroactive payments).

Remember: a parent’s child support obligations depends on whether they meet certain legal tests.  If they are obliged under law to pay, the next question becomes: how much do they need to pay?  Well, that depends on their income.  But it’s not just any “income” (e.g. income for tax purposes, etc.).  It’s actually a complicated legal analysis of what constitutes their income.  I’ll try to shed some light in the next few posts about relevant issues when trying to determine a payor’s income.

One such issue that comes to mind is:  what is the relevant time period for determining a parent’s “income” for child support purposes?

In a nutshell, the most current information must be used.

The Child Support Guidelines prescribe a method to determine child support. The starting point is the parent’s total income, as shown on his or her income tax return (latest T1 General form issued by the Canada Revenue Agency), and as adjusted in accordance with Schedule III of the Guidelines [s. 16]. The definitions section of the Guidelines provides that, where any amount is to be determined on the basis of specific information, the most current information must be used [s. 2(3)].

In Ward v. Ward, 44 R.F.L. (4th) 340, the Ontario Divisional Court stated the following with respect to the Federal Child Support Guidelines (which mirror the Ontario Child Support Guidelines):

23 In order to identify the table amount of child support the income of the petitioner must be ascertained. In the usual case the income of the payor-parent is identified by using the most current information available (pursuant to s. 2(3) of the Guidelines) and by referring to the “Total income” found in his or her T1 General form issued by Revenue Canada (pursuant to s. 16 of the Guidelines).

This view was reiterated in Muir v. Muir, 44 R.F.L. (4th) 340, where the Ontario Court of Justice observed:

23 I also note subsection 2(3) of the Guidelines which reads as follows:

Most current information – Where for the purposes of these Guidelines, any amount is determined on the basis of specified information, the most current information must be used.

Worth mentioning, however, is that courts have recognized that the amount of income disclosed on the tax return need not necessarily be used: prior to the end of a taxation year and in certain circumstances, a parent can apply to vary child support based on an anticipated reduction in income.

Finally, the court may consider the parent’s last 3 years of income and determine an amount that is fair and reasonable in light of any pattern of income, fluctuation in income or receipt of a non-recurring amount during those years [s. 17(1)]. The objective is to determine the fairest indicator of the individual’s income. Once the parent’s annual income is ascertained, the Ontario Child Support Tables set out the amount of monthly child support payable.  For more on using the tables or a child support calculator to determine child support obligations, please refer to my other blogs.

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Please note that the information provided herein is not legal advice and is provided for informational and educational purposes only.  If you need legal advice with respect to Canada Income Tax, you should seek professional assistance (e.g. make a post on Dynamic Lawyers).  We have tax lawyers registered on Dynamic Lawyers who can offer information, advice, and assistance with respect to your Canadian income tax issues, questions, and concerns.

So you’ve probably already read about one of the Canada Revenue Agency’s best kept secrets in my previous blog – namely, Taxation Operation Manuals or TOMs for short.  As previously discussed, the CRA prints TOMs for its employees’ use. TOMs cover all aspects of the operation of the Department, from purely internal matters such as Management Information Systems and Personnel Procedures, to maters that have an impact on taxpayers, such as Audit Techniques and Assessing Procedures.

Well, while I was cleaning up, I came across a couple of the TOMs which I had photocopied last spring and thought it would be worthwhile to scan one and make it available to the public.  Please keep in mind that this document, while up-to-date at the time I photocopied it (last spring) may be out of date.  As such, you are cautioned to attend your District Taxation Office and request to inspect and photocopy the latest and most applicable versions of the TOMs you’re looking into.  Also note that the line throughout the photocopy was a result of my scanner acting up and I apologize for the eyesore.

With this warning in mind, the following TOM (Section 7038) deals with Ministerial Discretion with respect to requests to cancel or waive interest and/or penalties.  While many TOMs have sections or entire pages missing (left blank) under privacy legislation, this particular TOM seems to be intact (although I could be wrong).

No doubt, knowing what the CRA and its employees have learned and been instructed/guided to follow through a TOM sheds valuable insight into how a party might go about trying to resolve a dispute.  It’s unclear the degree, if any, to which the CRA and its employees are bound by TOMs, but it seems safe to suggest that having the TOM in your hand when your negotiating or litigating a tax dispute with the CRA could add some degree of leverage.

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Please note that the information provided herein is not legal advice and is provided for educational purposes only.   If you need legal advice with respect to durable power of attorneys, you should seek professional assistance (e.g. make a post on Dynamic Lawyers).

In this blog, I’ll briefly review some of the key features of simple durable power of attorneys (also referred to as continuing power of attorneys).  Please note that I use the term “durable” and “continuing” throughout interchangeably.

Revoke Previous Continuing Power of Attorney
First, you’ll need to revoke any previous durable power of attorney.

Appoint an Attorney
Next, you’ll need to identify your attorney.  Use their full legal name and even adding an identifier (e.g. my son, my spouse, etc.) may help.  You can also consider appointing more than one person as your attorney.  This may be to share or divide responsibilities and to make sure there are sufficient checks and balances on decision-making; at the same time, it may overly complicate things and cause headache (diverging opinions coupled with joint decision-making authority may cause delays and turmoil!).

Appoint a Substitute Attorney
For whatever reason, in case the individual you appointed is incapable (e.g. vacation, sickness, death) or unwilling (e.g. through retirement) to act as your attorney at the time they need to, you should appoint a substitute attorney.

Authority of Attorney(s)
This part of your durable power of attorney should outline the powers and restrictions on powers which your attorney will have over your property.  Here, you can specify for example, that the attorney has the power, in his or her sole and absolute discretion, to make investments, to act as your litigation guardian to commence/defend/represent you in court, to take annual compensation in light of being your attorney, to deal with the Canada Revenue Agency on your behalf, etc.  Part of the terms and conditions of the durable power of attorney may also include things like the power to make loans or gifts on your behalf, the power to consult with specific people before decisions are made, and what happens if disputes arise (e.g. are they to be resolved through mediation or arbitration?).

Date of Effectiveness
The durable power of attorney is effective as soon as it is signed and witnesses unless specified otherwise in the actual durable power of attorney.  So you may state a specific date or event upon which the durable power of attorney becomes effective.

Signatures
Use blue ink (to show it’s original) instead of black.  Also, please refer to my previous blog entry on continuing powers of attorney which addressed some considerations which should be taken into account with respect to your witness’ signatures.

In case you were looking for a Continuing Power of Attorney legal form, look no further:

Continuing Power of Attorney for Property (Ontario)

This Legal Form can be used to appoint a person to make decisions on your behalf concerning your property and finances. It can impose limits on your attorney for property. Also, it is called “Continuing” or “Enduring” to signify that, even after you become incapable of making decisions concerning your own property, this Power of Attorney for Property will still be valid and applicable. We also have a Power of Attorney for Personal Care available on Dynamic Lawyers if you need one, as well as a Living Will (these things are typically done all at the same time with your Last Will and Testament). Here’s the sample Video Guide that comes with this Continuing Power of Attorney for Property:

Remember: if you need an Ontario lawyer, go to Dynamic Lawyers and make a post.

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Please note that the information provided herein is not legal advice and is provided for informational and educational purposes only.  If you need legal advice with respect to Canada Income Tax, you should seek professional assistance (e.g. make a post on Dynamic Lawyers).  We have tax lawyers registered on Dynamic Lawyers who can offer information, advice, and assistance with respect to your Canadian income tax issues, questions, and concerns.

A well-kept Canada Income Tax secret of the Canada Revenue Agency are Taxation Operation Manuals or TOMs for short.  The CRA prints TOMs for its employees’ use. TOMs cover all aspects of the operation of the Department, from purely internal matters such as Management Information Systems and Personnel Procedures, to maters that have an impact on taxpayers, such as Audit Techniques and Assessing Procedures.

Essentially, TOMs contain policies and procedures for applying and enforcing the Canada Income Tax Act. Under the Access to Information Act, the CRA makes large portions of TOMs available to the public. TOMs are not small. They occupy about 200 loose-leaf binders and fill up a couple of walls of a small reading room. It is not indexed, although a table of contents appears at the front of each binder. The TOMs which are publicly accessible are a censored version: pages or individual paragraphs will be blank.

What is left is, however, still very useful. For example, the TOMs will contain detailed instructions for auditors as to how to go about auditing particular kinds of businesses.  There are TOMs about Audit Directorate (which includes General Guidelines for Auditors), Special Investigations, Audit Support, Audit Applications Guide, Audit Research (which includes Audit Techniques Guidelines), Tax Avoidance, Computer Selected Assisted Audit Selection System, etc.

All in all, a very good Canada Income Tax resource.

The TOMs can only be viewed in ‘reading rooms’ maintained at each District Taxation Office. The reading rooms are open to the public, Monday through Friday, from 8:15 a.m. to 5:00 p.m.  The closest District Taxation Office with TOMs is located at: Toronto Centre Tax Services Office, 1 Front Street West, Toronto, Ontario M5J 2X6. I just walked in, told them I wanted to see the TOMs and then was taken to a reading room.  It doesn’t appear as though any Tax Office in Toronto other than the downtown Tax Office has the TOMs (i.e. no TOMs at North York or Scarborough).

They may be willing to make photocopies for a few pages (within reason). Larger requests will have to be formally made under the Federal Access to Information Act in Ottawa (fees are: $5 for a request, $0.25/page for photocopying, etc.). From what I’ve read and my conversations with CRA employees, not many people know about or use the TOMs (e.g. from 2001 to 2008, less than 40 people have signed in at the downtown Toronto Tax Office).

An on-line posting on March 28, 2008 provided the following index information with respect to all TOMs:

Appeals Branch
Appeals Officer – Taxation
CPP/EI Appeals Officers
Management Appeals Division
Support Staff – Tax

Assessment and Collections Branch
Abbreviations and Messages
Accounting Data Capture
Assessor
Automated Trust System
Business Window Information
CAL Keying Instructions
Cancellation Examination
Child Tax Benefits – Eligibility (CTB)
Child Tax Credit Prepayment
Children’s Special Allowances Manual (CSA)
Client Services
Collections
Common Operator Information Files (COIF) System
Confidence Validities
Confidence Validity Guidelines
Confidentiality
Control Clerk – Control
Coordinator Display Manual (T1 Keying)
Coordinator Manual (T1 Keying)
CORPAC Control
CORPAC Error Correction – Ottawa Taxation Centre
Correspondence by Paragraph Selections
Correspondence Referral Unit (CRU)
CPP-EI Rulings Program Administration Policies and Procedures
Direct Data Entry – Other Transcripts
Disposition of Taxable Canadian Property and/or Other Properties by
Non-Residents
Document Control
Electronic Filing (E-File) for T1 Returns
Electronic Letter Creation System (ELCSs)
Electronic Revenue Accounting (ERA) System Overview
Electronic Statement of Account (ESA)
Enforcement Action for Returns and Information
ERA Event and Transcript Preparation
ERA Interest Calculation General Procedures
ERA Procedures for Managers
ERA Statistics
Error Correction Instructions for Electronic Returns
Error Inspection – Error Clues
Error Inspection Control
Error Inspection of T2 Returns
Error Inspection Work Instructions
Exhibits
Explanation Codes and Messages
Explanation Codes used on Reassessment
Family Order and Agreements Enforcement Assistance and the Refund Set-
Off Programs
Family Orders and Agreements (FOA) Enforcement and Refund Set-Off
Program
Family Orders and Agreements Enforcement (FOA)
Farmer’s and Fishermen’s Program
FIP Keying Procedures
General Information
General Ledger Goods and Services Tax Credit
Goods and Services Harmonized Sales Tax (GST/HST) Credit
Identification Keying Instructions
Individual T1 Identification Master Update
Initial Assessing and Reassessing of T2 Returns
Initial Assessing of T1, Rejects, SAS, DOA and Prior Year
Installment Program
Installments and Installment Interest
Key Verification
Matching
Matching Programs
Non-Resident Tax
Notice Production
On-line Taxpayer Correspondence Systems (OTCS)
Operators and Coordinators Work Instructions
Penalties
Pension Reform
Policy
Preliminary Reassessment
Processing Instructions
Processing Leads and Liaison with the Minister du Revenue du Québec
Processing Payments on Filing
Quality Review
Reassessing T2 Returns
Reassessment Messages and Cancel Codes
Reassessment Processing Instructions
Recording and Flagging Procedures
Referrals
Refund Set-Offs
Refunds Enquiries
Registered Plans or Retirement Savings (RRSP, RRIF, RPP and DPSP)
Registered Retirement Savings Plan
Remission Orders
Resolution of Error Conditions
Resource Officers Instructions
Review Procedures
Reviewer
Reviewer Instructions
SAS-TCA Control Instructions
SAS-TCA Assessing
Seasonal Tax Assistance Centres
Selection Instructions of Returns
Sorting and Numbering
Source Deductions
Special Elections and Returns – TSO
Specialized Processing
Subsidiary Ledger Unit
Subsidiary Ledgers
Supervisor
Supplementary Instructions
T1 Accounting Data Capture
T1 Accounting Error Correction
T1 Accounting Related Guidelines
T1 Accounting Systems
T1 Mismatch
T1 Processing Review Program
T1 Records
T2 Identification Manual
T2 Interest Calculation
T2 Mismatch and Combines
T3 Initial Assessing, Adjustments and Correspondence Manual
T3 Records
T3 Returns
Tax Calculation Procedures
Taxable Benefits
TCA Processing
Team Leader Procedures
Technical Interpretations and Referrals to Other Sections
Topical Index
Tracing Refunds
Unemployment Insurance Coverage
Work Instructions
Years Not On TAPMA

Preparation of the Auditor’s Report
Compliance Programs Branch
Audit Applications Guide
Audit Programs
Audit Techniques
Audit Techniques (Handbook)
Audit Techniques Guidelines Related to the Oil and Gas (Exploration,
Development and Production)
Audit Techniques Guidelines Related to the Oil and Gas (Marketing)
Audit Techniques Guidelines Related to the Oil and Gas Industry (Refining)
Business Equity Valuations Section and Real Estate Appraisal Section
Computer-Assisted Audit Selection System (CAAS)
Non-Resident Correspondence
Preparation of the Auditor’s Report
Reviewers Instructions
Special Investigations
Supervisor Instructions
Tax Avoidance

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