Can a Court Impute Income for Spousal Support in BC?

If your ex has quit a job, taken a lower-paying one, or seems to be earning more than the paperwork shows, the support number can look unfair. Many people in that position ask whether a court can look past reported income and use a higher figure.

That idea is called imputing income. This article explains in plain terms why income matters so much in spousal support, where imputation can come up, and how people usually try to prove what a spouse really earns or could earn. Whether a court will do it depends on the facts, so a lawyer can confirm how it applies to you.

This article covers the law of British Columbia.

What imputing income means

Imputing income is a term used when the income relied on for support is not simply the figure a person reports. When and how a court does this depends on the facts of each case, so it is worth confirming with a lawyer how it could apply to you.

In BC, the court deciding the amount and duration of spousal support must have regard to each spouse's condition, means, needs and other circumstances, including how long the spouses lived together, the functions each performed during the relationship, and any agreement or order about support. That wording is broad, which is why the real picture of a spouse's means can matter more than a single tax return.

Why income changes the support number

The Spousal Support Advisory Guidelines are advisory only and their use is voluntary, and they do not decide whether someone is entitled to support in the first place. Even so, BC's government says most lawyers and judges use them to help set the amount.

Where there are no dependent children, the formula is 1.5% to 2% of the gross income difference for each year of marriage, up to a maximum of 50%. Because the income difference drives the result, a change in either spouse's income figure moves the range.

For example, with a payor earning $100,000, a recipient earning $40,000 and a 10-year marriage, the formula gives a range of $9,000 to $12,000 per year. That is illustrative arithmetic only, not a promise of any outcome. If the payor's real income were higher, or the recipient's lower, the range would change.

Where imputation tends to come up

• A payor whose income has changed. Whether a change affects support depends on the facts, and an existing order can be changed when the condition, means, needs or other circumstances of either spouse have changed.
• A payor who is self-employed or controls a business, where reported income may be easy to adjust.
• A recipient who is not working or not looking for work. An indefinite order may be time-limited or ended on review if the recipient has not made reasonable efforts toward self-sufficiency, and income may be imputed.
• A spouse who has not fully disclosed income, property or debts. Nondisclosure can be a ground to set aside a witnessed written support agreement and can justify changing an existing order or agreement.

Fault is generally not considered, but the court may look at conduct that arbitrarily or unreasonably causes, continues or worsens the need for support, or that affects ability to pay. Whether a particular job loss falls into that category depends on the facts.

How people try to prove real income

Courts work from evidence. If you think income is understated, or you are defending against a claim that yours is, the usual starting point is documents showing what has actually happened.

• Income tax returns and notices of assessment for several years.
• Recent pay stubs, employment letters and records of any raises or bonuses.
• Business financial statements, invoices and shareholder or owner draws, if self-employed.
• Bank and credit card statements showing spending that does not match reported income.
• Job history, training and résumé, to show what work a person is able to do.
• Records of job searches, applications or offers, which matter for showing efforts toward self-sufficiency.

Time limits and what to do next

A spousal support proceeding under the Family Law Act must be started within 2 years after the date a divorce judgment is made for married spouses, or within 2 years after the date of separation for spouses in a marriage-like relationship. That period is paused while the spouses are in family dispute resolution with a professional or in a prescribed process, and the limit does not apply to reviews of spousal support under sections 168 or 169 of the Act. The Divorce Act, section 15.2, contains no time limit for a married or formerly married spouse to apply for spousal support. If you are waiting for your ex to disclose, an interim order may be available on any application under the Family Law Act.

If an order already exists, it can be changed when the condition, means, needs or other circumstances of either spouse have changed, or when new substantial evidence or nondisclosure is discovered.

• Gather the income documents listed above before you meet a lawyer.
• Write a short timeline of job changes, income changes and the separation date.
• Check the dates against the 2-year limit as early as you can, since which limit applies depends on whether you were married and which law your claim falls under.
• Ask a lawyer whether income should be raised as an issue in your case and what evidence a court would expect.

Frequently asked questions