A strong Form F8 Financial Statement is one of the most important documents in your B.C. family law case. A properly completed Financial Statement can greatly improve the standing of your case and help move your legal matter toward a swift resolution.
A poorly prepared Financial Statement can not only undermine the goals of your case but can even be perceived as dishonest. However, creating a strong Financial Statement can feel like an overwhelming endeavor, especially during the emotional process of separation or divorce.
The assistance of an experienced family law lawyer or legal professional can not only ease the process but also ensure that you end up with a Financial Statement that is accurate and provides the best possible support for your case.
What is a Form F8 Financial Statement and what is it used for?
In the context of family law in B.C., a Financial Statement is a sworn document that provides a snapshot of a party's financial circumstances by setting out their income, expenses, assets, and debts. It is required in both the Provincial and Supreme Courts of British Columbia.
In most cases a Financial Statement is a required document in the court process, however, even if you choose to resolve your family matter outside of court through alternative dispute resolution (ADR) methods such as mediation, or arbitration, it is still a valuable tool for reaching a fair settlement.
Breaking down the Financial Statement
The best way to tackle a Financial Statement is to break it down and focus on it one section at a time. The primary components of the Financial Statement address a party's income, expenses, assets, and debts.
In most cases, both the Provincial and Supreme Court Financial Statements require the following:
- Your T1 Personal Income Tax Returns for the 3 most recent tax years
- Your Notices of Assessment for the three most recent tax years
- If you are an employee, your three most recent pay stubs
If you are a business owner, you may require additional documents such as your corporate tax returns and company financial statements.
Clients often find that listing their expenses is the most challenging part of completing a Financial Statement. It is difficult at the best of times to track your spending habits, and this stress is understandably exacerbated when you are undergoing a separation or divorce.
You will need to disclose your monthly or annual housing, childcare, and personal expenses. If you don't know how much you spend in each category, start by reviewing your monthly bank or credit card statements.
Assets & Debts
You will be required to list your assets and debts, together with their current values. A good approach is to review your property assessment notice(s), bank statements, investment accounts, and other documents.
Following are some common assets and debts that should be listed.
- Bank and investment accounts
- RRSPs and pensions
- Credit cards
- Lines of credit
Pitfalls of a poorly constructed Financial Statement
- It can undermine your credibility. First and foremost, a Financial Statement is a sworn affidavit. This means that you have to be truthful and accurate when completing it. A poorly constructed Financial Statement could undermine your credibility later on.
- It can increase your legal costs. An inaccurate or poorly drafted Financial Statement may lead to problems down the road. It is best to prepare a complete, accurate, and honest Financial Statement at the outset, rather than having to go back and explain discrepancies, identify missing information, or in some cases, redo the entire thing.
- It can jeopardize your settlement. Full, honest, and accurate financial disclosure is critical in family law. If you fail to disclose income or significant assets, a court may determine that any agreement reached between you and your former partner is significantly unfair and set it aside.
Final tips for completing a Financial Statement
- Take it one step at a time. Completing a Financial Statement does not have to be stressful. Take it one step at a time, and if you need advice or assistance, contact a legal professional. Paralegals and Legal Assistants work under the supervision of the lawyer and are trained to assist with these types of tasks.
- Don't forget the narrative. The Financial Statement is an affidavit, which means that you can include some narrative to provide context. This is helpful if your expenses are particularly high or low, or if you think your circumstances are significantly likely to change in the near future.
- Think critically. Once you have completed a draft, look it over and ask yourself if it makes sense. Do your expenses far outweigh your income? If yes, is there an explanation as to how the shortfall is covered? If the Financial Statement doesn't make sense, you may be forgetting something.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.