Vaughan Divorce Lawyers Advising on Financial Disclosure
Financial disclosure is a critical component of family law matters. Whether you are negotiating property division or establishing support obligations after a separation or divorce, many family law issues revolve around individual and family finances.
Full and honest financial disclosure in family matters is required by law, no matter the income level or complexity of a family’s financial situation. Without a clear picture of each spouse’s finances, couples cannot negotiate or litigate a fair resolution to issues regarding property division or child or spousal support, and other financially dependent issues.
The divorce lawyers at GDH Family Law in Vaughan have extensive experience helping clients meet their legal obligation to provide complete and accurate financial disclosure. Whether you want advice at a particular stage of the process or prefer us to handle it all, we provide as much or as little support as you require.
What is Financial Disclosure?
Financial disclosure in Ontario is governed by the Family Law Act and Ontario’s Family Law Rules. The legislation requires both sides of a family law dispute to provide each other with full disclosure of their income, expenses, assets, and liabilities. Each party must fill out a sworn financial statement and include supporting documentation.
There are two forms for providing financial disclosure in Ontario. The form used in each case depends on the type of issues involved between the parties:
- Property and Support – If a couple is negotiating or litigating property and support issues (child support or spousal support), they must each fill out a Form 13.1: Financial Statement (Property and Support).
- Support – If they are negotiating or litigating support issues only, they must fill out the slightly shorter Form 13: Financial Statement (Support Claims).
What Financial Information Do I Need to Disclose?
The type of financial information separated couples must exchange depends on the issues involved in their family law matter. The most common items included within a spouse’s financial disclosure include:
- Sworn Financial Statement;
- Income tax returns and Notices of Assessment for the most recent three years;
- Recent pay stubs;
- Employment contracts;
- Bank and investment statements;
- Line of credit, credit card, and mortgage documents;
- List of children’s expenses;
- List of expenses relating to the matrimonial home;
- Details of any other jointly-owned property.
What Matters Require Financial Disclosure?
Financial disclosure is involved in many steps of the separation and divorce process. It is a critical part of resolving family disputes fairly and efficiently. Providing all necessary information as quickly and accurately as possible keeps the legal process moving smoothly and helps avoid future conflicts.
Full and timely financial disclosure is required to reconcile a number of separation and divorce matters, including:
Division of Property
When a married couple separates, they must divide their property through a process known as equalization. Equalization is calculated using a formula under the Family Law Act. It requires both spouses to disclose the value of their assets and liabilities as of the date of marriage, the date of separation, and present date. They are also required to provide supporting documents and financial statements to prove the disclosed values.
The equalization process ensures both spouses leave the marriage with an equal share of the family property accumulated during the marriage (or its value). Providing complete and accurate financial disclosure keeps the process fair and places the spouses on the same economic footing.
Parents are equally responsible under the law to care for their children. The parent with whom the child does not primarily reside must provide their share of the children’s expenses by paying child support to the other parent.
Child support is calculated using the Child Support Guidelines. The guidelines consider the payor parent’s income, the parenting arrangement in place, and the number of children. The paying parent needs to provide documentation like income tax returns, pay stubs, and letters from their employer to prove their income.
The payor parent has an ongoing duty to provide complete and honest financial disclosure. This ensures they continue to provide their fair share of financial support for their children.
Spousal support ensures a spouse’s financial security is not disproportionately affected by the breakdown of their marriage. Unlike child support, spousal support is not automatic. In order for a spouse to seek spousal support from the other, they would have to first establish an entitlement to such financial support. Some situations where an obligation to pay spousal support may arise are where couples earn very different amounts of income, one spouse has a demonstrated need for financial support, or one spouse stayed home for much of the relationship to raise the couple’s children.
The amount and duration of spousal support are determined by considering many factors, including the recipient spouse’s need for financial assistance, the payor spouse’s ability to pay, and the length of the parties’ relationship. Full and frank disclosure of both spouses’ finances is required to ensure spousal support is calculated accurately and fairly.
How Long Do I Need to Provide Financial Disclosure?
Full, accurate financial disclosure must continue to be provided until property division is complete and all support obligations are complete. A separation agreement or court order may set out how often up-to-date disclosure must be provided.
A spouse’s failure to comply with their financial disclosure obligations will have a negative impact on their case. Courts do not look favourably upon parties who refuse to provide disclosure, provide inaccurate or incomplete information, or fail to keep their financial information current. Further, a judge may set aside any agreement or court order reached without full and frank legal disclosure.
Contact GDH Family Law in Vaughan for Guidance on Financial Disclosure
Gathering and organizing all necessary financial information for a family law case can be cumbersome and time-consuming. If you fail to provide complete and accurate disclosure or miss a deadline under Ontario’s family laws or court rules, a court may set aside your settlement agreement or order legal costs against you.
At GDH Family Law, our exceptional team of divorce lawyers are knowledgeable about all aspects of financial disclosure and can guide you through the process. We can help at any stage of your family law matter and provide as much or as little support as you require.
Located in Vaughan, the divorce lawyers at GDH Family Law represent clients throughout Maple, Concord, Woodbridge, Markham, Kleinburg, Richmond Hill, Nobleton, Toronto, Newmarket, Aurora, Brampton, Caledon, Mississauga, Etobicoke, North York, Thornhill, and King City. For a free initial consultation on your family matter, contact us at 416-535-6944 or reach out online.