“The starting point is to consider income as reported in line 150 of the income tax return, pursuant to section 16. The purpose of this provision is for predictability and consistency and does not allow for consideration of lifestyle. This is the “presumptive income”. See: Bak v. Dobell, 2007 ONCA 304 (CanLII), [2007] O.J. No. 1489 (Ont. C.A.)
Section 17 allows for determination of income where such fluctuates year to year, rendering a section 16 consideration unfair. Here, the focus is on a pattern of income over the prior of three years. The analysis is not based on simply averaging incomes; rather, it allows for a departure from line 150. See: Decaen v. Decaen, 2013 ONCA 218; Mason v. Mason, 2016 ONCA 725; Punzo v. Punzo, 2016 ONCA 957; and Halliwell v. Halliwell, 2017 ONCA 349.
Imputing income under section 19 is based on fairness and where an adjustment is required to the presumptive income. See: Bak v. Dobell, supra.
The leading decision on imputing income is Drygali v. Pauli (2002), 29 RFL (5th) 593 (Ont. C.A.), where the support payor had enrolled as a full-time university student. Gillese, J.A. addressed the prior inconsistent applications of section 19(1)(a) and provided helpful direction for trial judges. The following summarized the significant matters:
(a) The trial judge must consider three questions:
(i) is the parent intentionally under-employed or unemployed?
(ii) if so, is such required by reasonable education needs [or the needs of the child]?
(iii) If not so required, what income is appropriate in the circumstances? (para. 23)
(b)“Intentionally” does not mean a deliberate course of conduct for the purpose of undermining a support obligation – there is no need to find such an intent, rather the reference is to a “voluntary” act to earn less than what the parent is capable of earning. (para.s 24-28).
(c) There is no requirement of bad faith (para.s 29-30).
(d)One of the objectives of the Child Support Guidelines is to establish a fair standard of support for the children to ensure they benefit from the financial means of the parents. (para. 31).
(e) Imputing income is one method to give effect to the joint and ongoing obligation of parents to support their children – to do so, a parent must earn what he or she is capable of earning. (para. 32).
(f) When imputing income, a court must consider what is reasonable in the circumstances – factors include age, education, experience, skills and health of a parent. (para. 45).
See, also: Lavie v. Lavie, 2018 ONCA 10.”