Periodic child support payments made pursuant to an agreement or order made after May 1, 1997 are no longer deductible from the taxable income of the payor nor are they taxable as income in the hands of the recipient spouse or former spouse. The income tax deduction/inclusion rule still prevails, however, with respect to periodic spousal support. Consequently, it is now imperative to avoid agreements or orders for combined child and spousal support, even when lawyers or the courts are only dealing with interim arrangements.236Given that the new tax treatment for periodic child support orders does not apply to periodic spousal support orders, any agreement or court order must state separately the amount of support to be provided to each of them. If this is not done, the global amount of spousal and child support will be treated as child support and will be transferred on a tax-free basis.237Quite apart from the different tax consequences applicable to child support and spousal support, it should be borne in mind that global orders for spousal and child support have generated variation problems in the past238and that a child support order has priority over a spousal support order.239Spousal support and child support must be segregated into separate orders where an application is brought to vary a combined order for spousal and child support that predated
the amendments to the Divorce Act and the Federal Child Support Guidelines which came into force on May 1, 1997.240
 Compare Hall v. Hall,  O.J. No. 453 (Gen. Div.) (global amount of interim spousal and child support ordered without specific determination concerning imputed income where parties had orally agreed on payment of $1,200 per month prior to obligor’s loss of employment; interim order granted without prejudice to right to seek retroactive support when obligor’s income finally determined); compare also B.F.C. v. D.G.W.,  B.C.J. No. 1509 (S.C.); Berg v. Berg,  S.J. No. 118 (Q.B.).
 Mercer v. Canada,  T.C.J. No. 13.
 See Julien D. Payne, Payne on Divorce, 4th ed. (Scarborough, ON: Carswell, 1996) at 247-48.
 E.W. v. M.M.P., ...