First Situation
Ms. A and Mr. B, have been separated since 2003 (without other spouses) and have joint custody of their two children, with no support being paid, both claimed the wholly dependent person credit under s. 118(1)(b) (each for one child) and the child amount under paragraph 118(1)(b.1) (each for both children). How are the credits to be allocated? Also, if both parents agreed that Ms. A would claim the child amount for her two children, would Mr. B still be able to claim the wholly dependent person credit for one of his children?
After noting that s. 118(1)(b.1)(i) was not satisfied (the children did not reside with both parents throughout the year), the Directorate went on to find (assuming that each parent maintains a self-contained domestic establishment where he or she actually supports his or her children:
[E]ach parent could claim the wholly dependent person credit under paragraph 118(1)(b) for either Child X or Y, as long as only one parent claims the paragraph 118(1)(b) credit for a particular child (endnote 2) and each parent limits himself or herself to claiming the credit for only one child (endnote 3).
Parents can therefore agree to select one child each for whom they can claim both the credits under paragraphs 118(1)(b) and (b.1). It is not possible for a parent to claim the paragraph 118(1)(b.1) credit for a child if another person is already claiming the paragraph 118(1)(b) credit for that child. If both parents do not agree and each still claims the credit(s) under paragraphs 118(1)(b) and (b.1) for the same child, both parents may be denied the credit(s) by virtue of paragraph 118(4)(b).
Alternatively, Ms. A could claim the credits under paragraphs 118(1)(b) and (b.1) for one child and the credit under paragraph 118(1)(b.1) for the other, if Mr. B does not claim any credit. The reverse would also be possible for Mr. B … ..
If there were three children, either Ms. A or Mr. B could claim the credit under paragraph 118(1)(b.1) in respect of the third child.
[I]f both parents agree that Ms. A should claim the paragraph 118(1)(b.1) credit for both children, Mr. B should refrain from claiming the paragraph 118(1)(b) credit, since if he did, Ms. A would not be able to claim the paragraph 118(1)(b.1) credit for that child because of paragraph 118(4)(b).
Second Situation
Ms. C and Mr. D, who are separated with no other spouses, have one child, with no support payments being made. If there is a separation during the year, and given the shared custody, must a parent claim the s. 118(1)(b) credit for the child in order to make the s. 118(1)(b.1) claim, or is simply being eligible for the s. 118(1)(b) credit is sufficient. The Directorate responded:
It is not necessary to claim the credit under paragraph 118(1)(b) for either parent to be able to claim the amount under subparagraph 118(1)(b.1)(ii). On the other hand, if Mr. D claimed the married or common-law partner credit by virtue of paragraph 118(1)(a) in respect of Ms. C, he would not be able to claim the credit by virtue of paragraph 118(1)(b.1).