CAN GIFTS BE CONSIDERED INCOME FOR SUPPORT?

CAN GIFTS BE CONSIDERED INCOME FOR SUPPORT?

When determining child and spousal support in Ontario, a common question is whether cash gifts from relatives are considered income. Generally, these gifts are not included in a parent’s income for support. However, courts have the discretion to include them under certain circumstances, particularly when they significantly impact a recipient’s financial situation.

When Can Gifts Be Considered Income for Support?

The Ontario Court of Appeal’s 2007 decision confirmed that gifts can be included in income calculations for support if they meet specific criteria. Although gifts are not explicitly listed under Section 19(1) of the Child Support Guidelines as part of presumptive income, courts may assess whether a particular gift is exceptional enough to warrant inclusion.

For more insights on family support and income calculations, visit our article on Calculating Income for Child and Spousal Support .

Factors Courts Consider When Imputing Gift Income

Courts analyze multiple factors when deciding whether a gift should be included in income for support purposes:

1. Regularity – Are the gifts received frequently?
2. Duration – Have they been given consistently over a prolonged period?
3. Family Income Impact – Were the gifts used as part of the family’s income during cohabitation, shaping a particular lifestyle?
4. Exceptional Nature – Are there circumstances that make the gifts unique or unusual?
5. Standard of Living – Do the gifts go beyond covering basic living expenses?
6. Proportion of Income – How significant is the gift about the payor’s total income?
7. Support for an Adult Child – Are the gifts provided to assist an adult child facing financial hardship or disability?
8. Likelihood of Continuation – Is it reasonable to expect that the gifts will continue in the future?
9. Purpose and Nature – What is the true intention behind the gifts?

Real-World Example: Court Decision on Gift Income

In a notable Ontario case, the Superior Court of Justice ruled that a $50,000 annual gift received by a husband from his parents should be included in his income for support calculations. The court noted that:

• The husband had received the gift annually for eight years.
• The funds were treated as part of the family’s income, allowing them to maintain their lifestyle.
• The gift accounted for roughly 25% of the husband’s total business income.
• The court assumed that the gifts would continue in the future.

Key Takeaway: When Do Gifts Affect Support Calculations?

While occasional cash gifts from relatives are typically excluded from income assessments, regular and substantial gifts that contribute to a parent’s lifestyle may be considered when determining child and spousal support obligations.

If you’re navigating a family law case involving income calculations, consulting with an experienced Ontario family lawyer can help clarify how the courts may assess your financial situation.

For official guidelines on family support and income, check the Ontario Ministry of the Attorney General’s page on Child and Spousal Support Guidelines .

DISCLAIMER:

The information provided in this blog is for general informational purposes only and does not constitute legal advice. No attorney-client relationship is established through this writing. You should consult with a qualified attorney for advice tailored to your specific situation. The lawyer and their firm disclaim any liability arising from reliance on this blog or any other content on this website.