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.