There are a range of factors that come into play when determining child and spousal support payments including the paying spouse or parent’s annual income before tax. In instances where income has the potential to vary significantly, this can pose a problem when it comes to deciding on a final amount.
Basing Support Payments On Past Income Could Be Devastating
A recent case involving a high profile Vancouver luxury real estate agent brought this issue into the spotlight when the agent argued that his previous earnings should not be considered reflective of future income potential. According to a British Columbia Supreme Court judgment, his company has earned $13 million over the span of seven years which could be attributed in part to Vancouver’s booming real estate market.
As stricter lending rules, higher interest rates, and newly introduced government policies come into effect, the market is already showing signs of slowing down. The result? Less income than the agent had previously enjoyed. He argues that if his child and spousal support payments were to be calculated on his income over the last three years, the implications could be financially devastating.
The Complexity Of Unpredictable Income
Navigating child support and spousal support payments while relying on an unpredictable or irregular income can add a considerable degree of complexity to an already stressful situation. The volatility of certain markets and industries means that incomes can fluctuate dramatically, even over the course of a year. While part of the expectation is that both spouses will be able to continue to enjoy the same quality of life as they did pre-divorce, the reality is that when an income is so reliant on a shifting market, this may be unrealistic.
Working alongside an experienced family lawyer to help ensure that all parties are having their concerns addressed is critical. When it comes to a divorce, especially one involving children, no detail should be overlooked