How is net family property calculated in Ontario?
Net family property is the value of everything you own on your valuation date (usually the date you separated) minus everything you owed on that date, minus the value of property you brought into the marriage (your "marriage deductions"), and minus the value of any gifts or inheritances received during the marriage that were kept separate.
In practice: add up all your assets at separation, subtract your debts at separation, then subtract what you owned when you married. The result is your net family property. If the number is negative, it is treated as zero for equalization purposes — you cannot pass a negative number to your spouse.
The matrimonial home is a special exception: you cannot deduct its value even if you owned it before marriage, unless it was excluded by a marriage contract. Careful documentation of pre-marriage assets and inheritances matters enormously, so organizing records early is worthwhile.
Key takeaways
- Net family property equals assets at separation minus debts minus pre-marriage value
- Inheritances and gifts kept separate during marriage can be excluded
- The matrimonial home cannot be deducted even if you owned it before marrying
- A negative net family property is treated as zero