BNN Bloomberg: Split Income & Divorce - Featuring Christopher Yu, Shulman & Partner

In an interview with BNN Bloomberg, Christopher Yu, Family Lawyer and Partner at Shulman & Partners LLP, discussed how income splitting, tax deductions, and other financial strategies can complicate divorce proceedings in Ontario. Many couples use income splitting or spousal RRSPs to minimize taxes while together, but when a relationship ends, these arrangements can have unexpected legal consequences. Christopher outlined how income is treated differently under tax law and family law, particularly when determining child or spousal support. He also explained why courts often “gross up” income to reflect a spouse’s true financial capacity and when forensic accountants may be brought in to uncover complex financial details. The discussion highlighted the importance of transparency and realistic financial planning before and during separation.

“What’s permissible for CRA purposes doesn’t always fly for family law purposes. The Court looks at what you actually have the ability to make, not just what’s on paper.”
— Christopher Yu, Partner at Shulman & Partners LLP

Christopher joined the discussion to address how income splitting and other tax-efficient strategies intersect with family law obligations during divorce. He began by explaining that income becomes relevant in divorce when determining child and spousal support. While income splitting can legitimately lower taxes for couples during marriage, the courts may take a different view when support calculations are required. The law focuses on a spouse’s true earning capacity, not simply their declared taxable income.

Christopher noted that a common misconception is that one’s taxable income always reflects one’s real financial position. He provided examples such as self-employed individuals or small business owners who claim legitimate business deductions—like vehicles, home offices, meals, or insurance—to lower taxable income. While acceptable for Canada Revenue Agency purposes, these deductions may not be recognized by family courts. Judges often disallow portions of personal or inflated business expenses to more accurately determine a payer’s income for support purposes.

The interview also explored how complex financial records or long-term money movements can require expert analysis. Christopher explained that in such cases, family lawyers frequently bring in forensic accountants or chartered business valuators. These professionals review business records, trace funds, and determine what income should reasonably be attributed to a spouse. Their assessments often play a key role in achieving a fair support calculation.

Christopher also addressed the financial realities of divorce itself. Even outside of legal disputes, separation is inherently costly. Former partners lose the benefit of shared household expenses, while ongoing obligations—such as housing, legal fees, and child support—can strain finances further. When disputes escalate to court, costs can rise significantly, draining resources that might otherwise be used to rebuild post-divorce stability.

Throughout the conversation, Christopher emphasized the importance of realism and collaboration in family law. He acknowledged that while many divorces begin with emotional tension, finding an amicable solution often preserves both financial well-being and peace of mind. For separating couples, full disclosure, honest expectations, and qualified legal and financial advice remain essential to navigating these challenges.

Watch the full BNN Bloomberg segment here.

This media appearance is part of Shulman & Partners LLP’s ongoing contributions to Canadian family law discussions. Explore more of our media features in our In the Media archive.