ODSP is a cornerstone government support for dependent adults in Ontario. It provides income and employment supports as well as medical and dental benefits. One of goals of estate planning is to ensure that your family member is always eligible for these supports.
Eligibility for Income Support
- at least 18 years of age and living in Ontario and in financial need;
- having a substantial physical or mental impairment lasting more than one year; and
- the impairment substantially restricts the person’s ability to work, look after themselves or function in the community or workplace, as verified by a approvved health professional.
Because the program is designed for persons who are in financial need, there are limits on the income and assets received or held by the recipient and his or her family. (The famility includes the spouse and children of the recipient; it does not includes the parents of the recipient.)
What is Income?
The ODSP guidelines provide a list of income sources commonly received, including:
- earning from employment
- certain government support monies such as CPP, GAINS, EI
- Child, spousal or sponsorship support.
What is "Exempt" Income? i.e. exempt from ODSP regulations:
- Certain government support, such as Child Tax Benefit
- Payments from RDSP
- OSAP for student loans
- Gifts, inherigances, payments from trusts or life insurance are exempt up to a maximum of $6,000. per year. HOWEVER, any monies received over $6,000. can be exempt if used to buy disability-related items or services that have been approved in advance.
What are assets?
As with income, the ODSP recipient must meet the asset limitations. Here is a summary of the rules. Assets can be in the form of cash, property, stocks. The limits are:
- for a single person, the limit is $5,000
- for a person with a spouse, the limit is $7,500
The recipient can exceed those limits to save money to buy an item or service that you need for your health or for your disability.
Here are some of the assets that are allowed.
- the home you own and live in your primary vehicle (the one you use the most, if you have more than one)
- trust funds derived from an inheritance or life insurance policy, up to allowable limits
- the cash surrender value of life insurance policies, up to allowable limits
- pre-paid funerals
- Registered Education Savings Plans (RESP)
- Registered Disability Savings Plans (RDSP)
- necessary household and personal items, such as furniture and clothing.
The rules regarding income and assets are complex, so it advisable to speak with an ODSP staff member.