Do Support Payments Have to be Reported in the Income Tax Return?
How you report support payments in your income tax return depends on whether you are making or receiving the payments and whether the payments are for a child or an ex-spouse.
Child support payments are tax-neutral and do not have to be reported in the income tax return. In other words, the payer of support cannot deduct the payments from their income and the support recipient does not have to include them in their income.
Support payments for an ex-spouse are taxable and have to be reported in the income tax return. In other words, the payer of support can deduct the payments from their income and the support recipient has to include them in their income.
If a judgment or written agreement does not distinguish between child support and support for an ex-spouse, the total amount is considered to be child support and is tax-neutral.
Each year, we send you a statement of account that shows all the support you paid or received. Having the statement will help you prepare your federal and provincial income tax returns.
Payments made before a judgment
To be considered a support payment, a payment must be ordered under a written agreement or judgment.
Generally, when a payment is made before an agreement is signed or an order applied:
- the payer of support cannot deduct it from their income; and
- the recipient is not required to include it in their income.
However, payments are considered to be support payments if:
- the agreement or order specifies that the payments are considered to have been made under the agreement or order;
- the payments were made in the year the agreement was signed or the order applied, or in the previous year;
- the payments were made to to cover basic needs, such as:
The agreement is considered to be signed or the order applied on the date the first payment is made.