In a February 2, 2026 Tax Court of Canada case, the taxpayer argued that she was a shared-custody parent entitled to half of the CCB. The court noted that there are two approaches under which parents can meet the residency requirements to be shared-custody parents, as follows:
i. the child resides with each parent at least 40% of the time; or
ii. the child resides with the parents on an approximately equal basis.
The court noted that the explanatory notes to amendments implementing these approaches indicated that (ii) was intended to accommodate situations where the 40% test is generally met, but the time temporarily falls below 40% for reasons such as illness or vacation.
Taxpayer loses
The court noted that the test is not parenting time (that is, measuring waking hours during which the child is in the care and custody of each of the two parents), but where the child resides. The court opined that residing requires the presence of both the parent and the child carrying on their normal routines of life in or from a physical structure to which they return on a regularly recurring basis. The taxpayer resided with the child on some weekends (generally three weekends per month). She also spent periods of three to four hours at a time with the child during the week in malls, movie theatres, restaurants or attending their recreational activities. The court noted that these periods did not constitute residing, but merely visiting. The child did not reside with the taxpayer for more than two days per week, well below the 40% threshold required, so the taxpayer was not a shared-custody parent.
ACTION: Review living arrangements to determine if the time with the child constitutes residency, or only visits.
