Counting couples

The benefits and burdens of official tax status

Same-sex marriage may be spreading across the country but that doesn’t mean the government is printing up his-&-his and hers-&-hers tax forms for the new brides and grooms.

The emergence of gay marriage shouldn’t actually affect Canada’s tax laws, says Jason Murray, from Canadians for Equal Marriage.

That’s because, when it comes to taxes, common-law couples are already treated about the same as married ones. And queer common-law couples have been included on the tax forms since 2001.

In fact, while the same-sex marriage debate may be significant nationally, in terms of tax legislation the biggest queer change-the legal recognition of queer common-law couples-happened five years ago, says Maike Engelbrecht of Best Books, a bookkeeping and income tax service.

Today, she says, “there are not many differences between marriage and common-law. You just check a different box on your tax return.”

Sharon Gill, a communications manager for Canada Revenue Agency (CRA), agrees. There are few significant differences between common-law partners and married spouses (gay or straight) for tax purposes, she confirms. Although she does point out that common-law partners are only required to file jointly after they’ve lived together for 12 months, whereas married people have to file as a couple right away.

Filing taxes as spouses can have its perks.

Ever since the CRA extended its definition of common-law couples to queers (as part of a massive overhaul of all common-law references in federal legislation five years ago), same-sex partners have benefited from the same spousal recognition their straight counterparts have received for years when filing their taxes. If one spouse is working and supporting a stay-at-home partner, for example, common-law coupledom counts that as a tax break.

Another perk comes with RRSPs and pensions, which can now be transferred (upon death) without being taxed to your same-sex spouse or partner. Doug Freeman, a certified general accountant working in the West End, says it’s easiest to do this if you have already named your partner as a beneficiary on your RRSPs.

But common-law tax status isn’t all perks-and not everyone hailed the enlightened inclusion as a cause for rejoicing.

In fact, some of the new obligations that come with the status can be financially burdensome.

One such disadvantage primarily affects wealthier gay couples who own two properties, says Ken Smith, a lawyer at Smith & Hughes. Before queer couples counted, one partner could-as a “single” person-claim one property as their principle residence, while the other partner claimed property number two as theirs. Result: they each got a tax break.

Not anymore.

Engelbrecht points to the parenting credits as another financial disadvantage-though this one primarily hurts lower income families. Before the days of couple recognition, one parent of a same-sex duo could claim a tax credit as a single parent with an eligible dependent (a child who is an infant or too young to work). Now that gay couples are recognized as couples, neither partner can pass for a single parent anymore.


“Before you got more bang for your buck,” says Engelbrecht, who has two children with her partner.

She says she doesn’t mind the recognition for lesbian or gay parents, or paying the taxes, but it raises two sides of the common-law coin: “Are you telling me I have to be common-law?” and “Great, now we’re common-law!”

Working with same-sex couples to provide tax services, she has seen both reactions to the 2001 tax change.

Freeman has also seen varying reactions to the change. “By and large, couples have been happy to comply,” he says, “but some of the older couples had concerns.”

The concerns revolved mainly around why the government wanted to know their relationship status, he notes.

By law, couples are obligated to declare if they are common-law, but Gill says it is not something her agency is likely to check on.

Engelbrecht agrees. “The government’s not going to come into the bedroom and see if you’re having sex. If you’re saying you’re roommates, then you’re roommates,” she says.

As for those now-married queers who may be puzzling over their tax forms this year: just check off the married box in the upper right-hand portion of page one. You don’t have to specify same-sex.

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