If the court feels that the amount of income a parent claims they earn is not a fair reflection of their actual income, the court may attribute income to that person. This is called 'imputing' income.
If the court imputes income to someone, this means that they can set the child support amount based on what the person should be earning - their imputed income - as opposed to what they actually are earning, or are claiming to be earning. The circumstances where the court may impute income include:
- the parent is purposely unemployed or underemployed (unless this is because of the parent’s reasonable educational or health needs, or is required by the needs of the child)
- the parent is exempt from (does not have to pay) income tax
- the parent lives in a country where income tax is significantly lower than in Canada
- the parent appears to have diverted (hidden) income which would affect the level of child support
- the parent’s property is not reasonably used to generate income
- the parent has failed to provide income information as required
- the parent unreasonably deducts expenses from income
- the parent gets a significant portion of their income from dividends, capital gains, or other sources, that are taxed at a lower rate than employment or business income, or are exempt from tax
- parent is a beneficiary under a trust, and is or will be receiving income or other benefits from the trust
If you think that your situation might require having a judge impute income to the other party, you should speak with your family lawyer for advice. The court cannot search for evidence for you – you must figure out a way to show the court why the other party should have income imputed to them.