22 December 1999 Internal T.I. 992147A - SPOUSAL AMOUNT

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.

Principal Issues: Can a separated father claim the equivalent-to-spouse credit when the child stays overnight on a regular basis such as every second weekend.?

Position: Perhaps, can only be determined on a case-by-case basis..

Reasons: When the custody rights of the secondary caregiver, the father in this case, require that person to be responsible for the usual day-to-day activities of raising a child, such as ensuring the child attends school, preparing regular meals etc., the child would be considered "to live" with the secondary caregiver during the times that the secondary caregiver has custody of the child and would likely be entitled to the equivalent-to-spouse credit. This is not the case when a non-custodial parent only has legal access or visitation rights.

		November 23, 1999

Quebec Tax Services HEADQUARTERS
Client Assistance Division Karen Power, CA

Attention:  Mario Beaulieu
		7-992147

Equivalent-To-Spouse Credit

We are writing in reply to your letter of July 29, 1999, requesting confirmation of whether individuals in a child custody agreement should be entitled to claim the equivalent-to-spouse credit pursuant to paragraph 118(1)(b) of the Income Tax Act (the "Act"). We also acknowledge receipt of a copy of an update to TOM 19(25) dated March 23, 1999 which you have provided for our review.

In the situation you describe the mother and father live separately and each maintains their own self-contained domestic establishment. According to their child custody agreement, the children stay with the father every other weekend and occasionally during holidays. The recent update of TOM 19(25) indicates that the father in the above situation would likely be entitled to claim the equivalent-to-spouse credit. You have asked that we confirm this position, as it is your view, that it is a contradiction of opinion letter E9328015 dated February 11, 1994.

Our Comments

In order to claim the equivalent-to-spouse credit, an individual must meet the conditions set out in paragraph 118(1)(b) of the Act. Generally to qualify for this tax credit, an individual must support in a residence that is lived in and maintained by the individual, a person who is: resident in Canada, unless the person is a child of the individual; wholly-dependent for support on the individual, or on the individual and other persons, if any, who maintain the residence; related to the individual; and under 18 or dependent because of mental or physical infirmity, unless the person is a parent or grandparent.

Opinion letter E9328015 indicates that in an arrangement where a father has legal access only to his child, the child would not generally be considered "wholly dependent". The letter explains that in the Agency's view visitations ("legal access") differs from custody because the non-custodial parent and child(ren) do not reside together.

The March 23, 1999 addition to TOM 19(25) outlines joint-custody arrangements in which the child can be considered to reside with both the primary caregiver and the secondary caregiver. When the custody rights of the secondary caregiver require that person to be responsible for the usual day-to-day activities of raising a child, such as ensuring the child attends school, preparing regular meals etc., the child would be considered "to live" with the secondary caregiver during the times that the secondary caregiver has custody of the child. These comments will generally only apply where a court order provides for the father to have custodial rights, as opposed to visitation or "legal access" rights as was the case in the above mentioned opinion letter.

In our view, the position outlined in the addition to TOM 19(25) correctly reflect the Canada Custom's and Revenue Agency's position and for the reasons discussed above does not contradict opinion letter E9328015. It is unclear from the facts provided in your incoming memo whether your situation falls within the position reflected in the addition to TOM 19(25) or letter E9328015.

Roberta Albert, CA
for Director
Business and Publications Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch

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