SPOUSE SEPARATION

When marital status becomes “separated”:

A spouse or common-law partner is considered separated when they live apart from their partner due to a breakdown in the relationship for a period of at least 90 consecutive days. Once the 90-day period has passed, the separation is recognized as effective from the first day the couple began living apart.

If partners live apart for reasons other than a relationship breakdown, they are not considered separated. Examples include:

• One spouse temporarily working or studying abroad.
• One spouse immigrated to Canada while the other still lives abroad.
• One spouse is incarcerated.

UFile steps where separation occurs in tax year:

For a tax return, a person is required to declare their marital status as of December 31st of the tax year.

1. If, at the time of preparing the tax return, the couple began their separation during the tax year but 90 days has not yet passed, then the spouses should declare their status as married or common-law.
2. If the couple began their separation during the tax year and 90 days has passed by the time the tax return is being prepared by the clinic, then the spouses should declare their status as separated. In UFile’s identification section, there is a question, Did your marital status change in [tax year]. Answer with change, and that will generate a new section, marital status change. In that section, select the appropriate choice for status as of December 31st of the tax year, for example: Married, then separated.

What if the 90 days are over after the tax return is filed?

If the couple separate within a tax year and their returns are filed less than 90 days after separation, each spouse or partner would have reported their status as married or common law on the tax return.

If after the returns were filed the couple reach 90 days of separation, each spouse or partner must notify the CRA of their change in marital status, using the date they first began living apart. In some cases this may trigger a requirement to file a T1-Adjustment for the tax year already filed, since credits or benefits may need to be recalculated based on the new status.

Reporting the separation to the CRA:

After 90 days of separation it should be reported to the CRA by the end of the next month. There are different ways to report a change in marital status:

• Call CRA at 1-800-387-1193.
• In CRA Account. Go to Profile, then Marital Status, and click on ‘Edit’
• Mail a Form RC65 to the CRA.
• On a tax return, for 2025 or later - but be aware of timing.

Effect of separation on benefits:

When spouses separate they must wait until they have lived separate and apart for at least 90 consecutive days before informing the CRA. Once the CRA is informed, benefits are recalculated retroactively, effective from the month following the month in which the separation began.

The Canada Child Benefit, GST/HST credit, and Ontario Trillium Benefit are generally calculated using adjusted family net income from a base year.^[1] For example, the Canada Child Benefit for July 2025 to June 2026 is calculated using the spouses' combined adjusted net incomes for the 2024 tax year.

Following a separation, each spouse's adjusted family net income is recalculated using their individual income from the base year, rather than their combined income, even if they were married or living common-law during that base year.

For example, suppose a couple separates on August 1, 2025, and the mother has sole custody of their children. After the separation has lasted at least 90 consecutive days and is reported to the CRA, the mother's Canada Child Benefit for September 2025 to June 2026 will be recalculated using her individual adjusted net income for 2024. Payments made between September 2025 and the reporting date will be adjusted retroactively.

The recalculation may result in the CRA sending out one or more notices each advising of an overpayment and requesting a balance owing.

What if a client doesn’t know if their ex-spouse reported the separation?

A client reporting a separation on their return may not know if their ex-spouse reported a separation, or if so, the date of separation.

Depending on the circumstances, the CRA might ask the client to provide information or documents supporting the new status. Such circumstances triggering a request may include:

• the ex-spouse reported a different separation dat
• the ex-spouse reported common-law or married status with the client after the separation date
• both spouses reported the same separation date, but they continue to have the same mailing address on record (or the CRA has some other reason to believe that the spouses continue to live under the same roof)

Can spouses separate but continue to live under the same roof?

For tax purposes, it is possible to be separated yet living under the same roof.^[2] However, the ex-spouses may face a very uphill battle persuading the CRA of the separation, particularly if one of the ex-spouses has children and the separated status results in a higher Canada Child Benefit.

The CRA may send a letter requesting documents to support separated status, including for example:  a separation agreement, a custody agreement, mortgage papers, property tax bill with property description, real estate listing, utility bills, driver’s license, auto insurance policy, medical insurance policy, bank statements, medical records, birth certificates, and school records.

The separated couple may wish to provide additional documents including statements or affidavits of persons with knowledge of the separated relationship, such as friends, relatives, and teachers. The evidence should show that the two people don’t have a romantic relationship, they don’t share a bedroom, they are financially and socially independent, and they no longer represent themselves to others as a couple.

References:

• CRA web page - Marital status
• CRA web page - Reporting Change in Marital Status