Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
DOCUMENT TYPE:
District Office Memo
ACCESS TO INFORMATION:
This Correspondence CAN be Released Under ATIP
Principal Issues:
1. Where common-law couple separate prior to Dec. 31 what is there status at year end for purposes of persoanal credits, GST credits, alimony etc.
Position TAKEN:
1. Where separation is less than 90 days couple would each be considered a spouse of the other.
2. Where separation is at least 90 days the couple will have been considered separated prior to year end.
3. Length of separation is relevant for spousal determination only.
Reasons FOR POSITION TAKEN:
1. Subsection 252(4) deems couple to be cohabiting in a conjugal relationship if the separation due to a breakdown in the relationship is less than 90 days.
2. Wording in paragraph (a) provides that "deemed cohabitation" not applicable if separation extends past 90 days.
3. The application of "deemed cohabitation" in 1. & 2. above is "...for purposes of this paragraph..." (252(4)(a)) and not the Act as a whole; therefore, only for purposes of spousal determination.
LEGAL: Not Applicable
FINANCE OPINION: Not Applicable
JURISPRUDENCE: None
RCT PUBLICATIONS:
HAA NUMBER:
7903-1
March 17, 1994
Windsor District Office Business and General
Client Assistance Division Division
Janet Ciuryek/Diane Masaro J.A. Szeszycki
(613) 957-8953
940568
Common-law Relationships - Separations
This is in reply to your note dated March 7, 1994 requesting clarification as to the effect of the provisions of subsection 252(4) of the Income Tax Act (the Act) on the status of parties to a common-law relationship at any particular time where there have been short or long term separations in the year, as well as the effect of those separations on the application of other provisions of the Act. In the situation set out in your note, there is particular concern in circumstances where the separation straddles the year end such that the taxpayer's "status" as at December 31, 1993 is at issue.
Subsection 252(4) of the act was introduced, effective for the 1993 and subsequent taxation years, to ensure that common-law couples are treated the same way as married couples under the tax system. It defines the term "spouse" to include a party to a common-law relationship, providing guidelines for establishing whether, at any particular time, a spousal relationship exists.
Paragraph 252(4)(a) of the Act which sets out these guidelines states that:
"words referring to a spouse at any time of a taxpayer include the person of the opposite sex who cohabits at that time with the taxpayer in a conjugal relationship and
(i) has so cohabited with the taxpayer throughout a 12-month period ending before that time, or
(ii) is a parent of a child of whom the taxpayer is a parent
and, for the purposes of this paragraph, where at any time the taxpayer and the person cohabit in a conjugal relationship, they shall, at any particular time after that time, be deemed to be cohabiting in a conjugal relationship unless they were not cohabiting at the particular time for a period of at least 90 days that includes that particular time because of a breakdown of their conjugal relationship"
The purpose of paragraph 252(4)(a) of the Act is to determine whether a particular individual can be considered a spouse in relation to the taxpayer for the general purposes of the Act. It sets out the requirement that parties to a common-law relationship, in order to establish a spousal relationship for the purposes of the Act, must cohabit in a conjugal relationship throughout a 12-month period, or assume a role as parents to a natural or adoptive child of the relationship.
When making the determination as to marital status as at a particular time, such as December 31, the initial question to be asked is whether the parties were cohabiting in a conjugal relationship at the particular time. If so, the next question is whether they have satisfied either one of the other two criteria: (1) cohabitation in a conjugal relationship throughout a 12-month period ending before that time, or (2) assumption of the parental role of a natural or adoptive child. If they have satisfied these conditions then the common-law relationship will clearly be considered a spousal relationship as at the particular time.
In circumstances where, as at the particular time, the couple are not actually cohabiting due to a breakdown in their conjugal relationship, the remainder of paragraph 252(4)(a) of the Act provides further guidelines to assist our determination. Where the parties, at any time (prior to the particular time) cohabited in a conjugal relationship but then ceased cohabiting due to a breakdown in that relationship for a period of less than 90 days this part of paragraph 252(4)(a) will deem them to have continued to cohabit in a conjugal relationship throughout that short period; i.e., the continuity of cohabitation in a conjugal relationship for purposes of the 12-month test will not be disturbed. This "deemed cohabitation" applies not only for purposes of establishing whether the parties have cohabited in a conjugal relationship throughout a 12-month period in the past but also whether they are continuing to so cohabit as at the particular time. The effect of the "deeming" on the application of other provisions of the Act is discussed later in our response.
Where the period in which the couple cease to cohabit due to a breakdown in the conjugal relationship extends to at least 90 days, the "deemed cohabitation" discussed in the previous paragraph does not apply. In other words, cohabitation in a conjugal relationship during a period of actual non-cohabitation is deemed unless that period extends to at least 90 days. The effect of the underlined clause is to make the period of non-cohabitation retroactive to its beginning as soon as its length reaches 90 days. In such a case, the parties will not be considered to have been cohabiting in a conjugal relationship at the particular time (December 31st, in your example) if the actual period of non-cohabitation due to a breakdown in the conjugal relationship began prior to that time. As a consequence, for example, couples who have been cohabiting in a conjugal relationship for a period of ten months before permanently ceasing to cohabit will not be considered to meet the 12-month test by the "deemed cohabitation" referred to earlier.
Once the individual's status as a "married" or "single" person has been established, then their entitlement to personal credits, GST credits, child tax benefits, etc. can be determined. It should be emphasized that the "deemed cohabitation" referred to earlier for periods of less than 90 days is limited to the purposes of paragraph 252(4)(a) only; that is, only for the purposes of determining whether a spousal relationship exists as at a particular time for the purposes of the Act in general. Consequently, where a common-law couple actually live separate and apart they will be treated as living separate and apart for purposes of certain of the other provisions of the Act (see exceptions below). For example, a couple that so separates can begin to provide for the maintenance of the spouse or child such that the maintenance provisions under sections 56(1)(b), 56(1)(c), 60(b) and 60(c) could conceivably apply. In addition, the status of actually living separate and apart will have to be considered for purposes of administering the personal credits available under paragraphs 118(1)(a) and (b).
Included in the exceptions referred to above we note that for the purposes of the child tax benefit and the GST credit, the definition of "cohabiting spouse" in section 122.6 of the Act contains its own "deemed cohabitation" where the couple live separate and apart because of a breakdown in the marriage for less than 90 days. As well, the reference in the child care expense and credit transfer provisions (subparagraph 63(2)(b)(vi) and section 118.8 of the Act) to supporting spouse also does not recognize a period in which the couple were living separate and apart due to such a breakdown, of less than 90 days commencing in the year.
We hope our comments will be of assistance to you.
P.D. Fuoco
Section Chief
Personal and General Section
Business and General Division
Rulings Directorate
Legislative and Intergovernmental
Affairs Branch
c.c.Client Assistance Directorate
c.c.T1 Programs Division
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