The Ontario government have made some positive changes to the Ontario Disability Support Program (ODSP). Some more significant than others, but all are improvements. Here are some of the changes.
As of September 1, 2017…
1. Income benefits increased by 2%.
Not enough to lift you above the poverty line or even near to it, if all you have to rely on is your ODSP. It at least slows down the impact inflation has on your cost of living.
2. Asset Limits have increased.
Until September 1, 2017, you would not qualify for ODSP if you had more than $5,000 in assets ($7,500 for couples). Now you can have as much as $40,000 in assets ($50,000 for couples). This change lets you hold onto more money without spending it or putting it into a complicated exempt asset like an RDSP that may not offer the flexibility you need.
3. Gift limits have increased.
You are now allowed to receive as much as $10,000 in gifts and voluntary payments in a 12-month period to cover non-disability related expenses. This is a $4,000 increase over the previous $6,000 limit. Gifts and voluntary payments include, monetary gifts, money from exempt assets, such as segregated funds and trust accounts. Money from an RDSP is not subject to this rule.
4. Deductible disability-related employment expenses increased from $300 to $1,000 per month.
For those who are working, you can keep more of your ODSP benefits by submitting disability-related expenses you incur because of your employment. Prior to September 1st, the maximum monthly amount of disability-related employment expenses you could deduct was $300. ODSP increased the limit from $300 to $1,000.
The first $200 of net income you earn in a month does not reduce your ODSP income. Every dollar you earn above and beyond the initial $200, reduces your ODSP income by 50 cents. If you have disability-related expenses because you are working, such as specialized transit services, adaptive equipment, sign-language interpreting, etc., you can deduct those expenses from the calculated amount that would otherwise reduce your ODSP benefits.
Here is an example for a person earning $1,500 a month in net employment income with $450 of monthly disability-related employment expenses:
Net Monthly Employment Income (After taxes & deductions): $1,500
Less $200 flat exemption: $1,500 – $200 = $1,300
Less 50 cents per $1.00 ($1,300/2 = $750): $1,300 – $750 = $550
Less $450 disability-related emp. expenses: $550 – $450 = $100
ODSP income benefit reduced by $100.
By claiming the disability-related employment expenses, this person’s ODSP is reduced by $100, only. Before September 1, 2017, her ODSP would have been reduced by $250, because she was not able to claim more than $300 of her $450 of disability-related employment expenses. Now she is allowed to claim the entire $450 of expenses because the disability-related employment expense limit has been increased to $1,000.
5, Streamlining application, reinstatement, and review processes.
In an effort to ease administration, frustration and wait times that have resulted from providing proof of one’s disability, ODSP has done the following:
People with developmental disabilities who deemed eligible for adult developmental services funded by the Ministry of Community and Social Services do not have to provide evidence of disability for the ODSP application process.
A person identified with a disability by ODSP, but not approved for benefits for other reasons, will not have to provide evidence of disability if they re-apply at a future point in time.
As of August 1, 2017
ODSP made a significant change to its treatment of legal settlements. The first $100,000 of an award for pain and suffering was treated as exempt by ODSP. As of August 1st, that cap has been removed. Regardless of the amount, an award for pain and suffering will be considered exempt by ODSP.
This change simplifies personal injury settlements for people on ODSP, but only to a certain extent. Yes, the entire amount for pain and suffering is exempt, but the income it generates is not. Interest, dividend, capital gains an exempt award generates is considered income. As well, a settlement can include different types of claims, such as a claim for loss of past wages, and loss of future wages. ODSP treats awards for each of these claims differently. How ODSP treats settlements is a topic to be discussed in future blogs.
Thank you Ron, I am flabbergasted that I had not been aware of the coming changes on September 1.
PS: there is a mistake in your example in 4:
1300/2=650 not 750. ODSP is therefore reduced by 200 not 100.
Thanks for the note and pointing out the calc error! Fixed it.
Let us say you inherite $40,000. Are you now allowed to spend that money without consideration of ODSP?
Hi Christine. Good question. If you get $40,000 in an inheritance and you already have other non-exempt ODSP assets (e.g. money in your bank account) you would automatically have more than $40,000 in your name, which would jeopardize your ODSP eligibility. But let’s say a person has only $500 in non-exempt ODSP assets when they get an inheritance of $39,000. They would have $39,500 in assets so they would be under the $40,000 maximum asset limit. However, that person is not allowed to receive more than $10,000 in a 12-month period for non-disability related expenses. By putting that inheritance in their bank account, they would automatically break that $10,000/12-month period limit. As a result, they could lose a month of ODSP. They should be back on ODSP the next month, though, as long as the amount in their bank account (plus the amount in other non-exempt assets) is under $40,000. They would then be able to spend as much of that money as they want in any period of time. They could use that money for almost any expense. Just keep in mind that they wouldn’t be allowed to use that money to purchase an asset that is not exempt by ODSP and assume that it would be treated as exempt because it was purchased with exempt money. Example: If they bought a $15,000 boat with the money, the boat would not be treated as an ODSP exempt asset.
My 21 year old daughter receives ODSP. Here grandmother died recently and she will be receiving around $50000. She has about $3000 in assets. She does not yet have an RDSP though we are planning on getting one. The estate lawyer said she will lose her ODSP. Is there anything we can do to prevent this as we wanted the inheritance to be saved for her when we are no longer financially helping her.
Assuming your daughter is single, she is allowed to have up to $40,000 in assets. If she receives a $50,000 inheritance, she would have $53,000 in total. She could put the surplus into an RDSP. You might want to consider putting some of the money segregated funds see: ODSP and My Inheritance. A trust may also be an option. Depending on the strategy employed, the inheritance may or may not result in the loss of ODSP for one month. There are a number of considerations to determine the best course of action.
I’m on the ODSP I just received a cash gift from my uncle for $8000 can I open a new bank account and put that money in it ? Are ODSP recipients allowed to have more than just one Bank account ?
I do not know of any ODSP policy that limits the number of bank accounts, however, you are obliged to inform ODSP of the amount you have received, the source of the gift and what you have done with the money. Whether the gift affects your ODSP in any manner will depend on how you use the money and when, the amount and type of assets you currently have, and the amount of money you have received in gift and voluntary payments over the past 12 months.
If one already has an RDSP and inherits 60,000 can a Lawyer draw up an Inheritance Trust before the funds are received to put the money in? My Lawyer mentioned an Inheritance Trust but want to be sure this is allowed~he seems to believe it is, but want to be sure. Many Thanks.
My husband makes 3600 net every month.
We have 2 kids under 6 one is receiving ACSD.
I have health conditions that qualify me for ODSP.
Am I going to get some financial assistance from ODSP?
We are renting monthly 1500.
If your husband is earning $3600 per month, net, and you qualify for ODSP from a disability perspective, I believe you should receive some financial support, possibly a couple of hundred dollars per month, but I can’t be sure of the amount. If you are granted ODSP, you would also receive the health benefits associated with the program, including prescription drug coverage.
I am currently on ODSP. My grandmother passed away about a week ago and left me $10,000 which I have not received yet but will receive shortly in a cheque form. I need things for my home, such as furniture and household items. Can I spend the money freely on such items and do I have to report this 10,000 inheritance? I don’t want this money to affect my disability support and if it will, I’d rather not have it. Please let me know what this all entails. Thanks in advance.
ODSP expects you to report the inheritance, even if the money is used to purchase things that do not affect your ODSP. I can’t give you specific advice about your situation in my answer here. What I can say is that an inheritance could be treated as a gift. ODSP allows people to receive up to $10,000 in gifts in a 12-month period without it affecting ODSP benefits. Any money received as a gift that is used to pay for disability-related expenses does not count as part of the $10,000 limit.
My son is on ODSP. His wife works part time. I have heard of new rules pertaining to income exemptions. How much is she able to earn before they start to claw back?
The Ford government announced new rules but they have not been implemented yet and they have not said exactly when they will be implemented. The announcement was made in November 2018, noting the changes would be made sometime within the following 18 months. Currently, the first $200 earned in a month after taxes and deductions does not affect ODSP. Every additional dollar earned, reduces ODSP income by 50 cents.