The Statement of Income and Expenses and Balance Sheet (Form III) is a form that helps the Court determine the financial means and needs of divorcing spouses so it can make an order with respect to spousal support (alimony).
The form must be completed for the court to fix or modify spousal support. It must be completed even if you and your spouse already have an agreement.
You must also include these documents, where applicable: your employment earnings slip (T-4), financial statements of your earnings from business or self-employment, and a statement of rental revenues and expenses. You must also provide your federal and provincial income tax returns and notices of assessment for the most current year. Current income tax returns and notices of assessment must also be filed.
If you fail to include these documents, the Court may estimate your true revenue, which may lead to the attribution of a higher income, with all the risks this entails. Be prepared to provide evidence of your expenses and indebtedness, or the judge may reduce your budgeted expenses.
Remember to complete the “Assets and Liabilities” page, otherwise the form will be rejected by the Court!
You must indicate the date upon which the form was signed and get sworn in before a commissioner of oaths, who also signs and indicates the date of swearing in.
There are income tax calculations which must be done using tax software, to calculate how much income tax the receiving spouse would have to pay upon payment of alimony, and how much income tax the paying spouse would save. This calculation is necessary because spousal alimony is taxable for the receiving spouse and tax-deductible for the paying spouse. A low-income receiving spouse (usually the wife) will likely lose certain tax credits and deductions upon receipt of alimony, because her gross income will increase – tax software will calculate this loss of tax credits!
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