Do we have to update our separation agreement if one parent's income changes significantly in Ontario?

Child support is the area most affected by income changes, and it is also the area where an update may be legally required even without both parties agreeing to change the agreement.

Ontario family law requires that child support be set in accordance with the Child Support Guidelines, which are based on the paying parent's income. If either parent's income changes significantly — upward or downward — the child support amount should be recalculated. Many agreements include an annual disclosure clause requiring each parent to share tax returns and notices of assessment so that support can be updated to reflect current incomes.

If the paying parent's income increases significantly and support is not adjusted, the recipient parent can apply to the court to vary support. Similarly, if income drops significantly, the paying parent can apply to reduce support. Courts treat child support variations as straightforward recalculations under the guidelines, provided the income change is genuine and material.

For spousal support, whether an income change triggers a right to vary depends on what the agreement says. Some agreements include a review mechanism; others have fixed terms. If the agreement is silent, a court application may be needed to show the income change constitutes a material change in circumstances.

Annual income disclosure is the simplest way to keep both forms of support current without litigation.