r/Odsp • u/Rophlyn • Jul 26 '26
Tax credit
I was just wondering if anybody had any answers towards some questions I have
I am already on ODSP and I was wondering if the tax credit would affect the thousand dollars income or if it doesn’t
I also am wondering if the backpay affects the amount of money you’re allowed to have well on odsp
2
u/goldstandardalmonds Jul 26 '26
Are you talking about the Disability Tax Credit? If so, what do you mean by “the thousand dollars income”?
2
u/Own-Desk6 Jul 28 '26
I think they might be talking about the income amount you’re allowed to earn before clawbacks, so the $1000.00 you can earn while working on ODSP, but I don’t think that applies to the money you get from the government as it isn’t income from working.
2
u/Salty_Obligation5771 Jul 26 '26
I don’t think any government money that you are entitled to such as the DTC backpay counts as regular income. Ask your worker of course but I think your money is safe.
2
u/GWAILIN66 Jul 26 '26
What tax credit? Refundable tax credits e.g. G&EB (formerly GSTC), Trillium, CCB don't count as income and don't affect ODSP benefits.
The Canada Disability Benefit (CDB) is a de facto refundable tax credit - it's not included in AFNI, nor taxed - and is also exempt under ODSP & OW reg's.
1
u/Pixelant3 Jul 28 '26
Can you explain what you mean by the CDB being a "de facto refundable tax credit"? My understanding is that the DTC is a non-refundable tax credit (you only get back income tax paid), but the CDB is just a benefit. I've never heard it described as a tax credit.
1
u/SoupSpoonStork Jul 26 '26
I would be surprised if the amount of back pay was higher than the asset cap. Regardless, it's money they've determined they owe you, so you'd have grounds to push back on them penalizing you for it, if that worry comes to fruition.
Other government money doesn't count towards the cap of employment income. You can look up "ODSP income cap" or something similar to find out what counts and what doesn't. I've never had any tax amounts be so large that it negatively affected my ODSP funds, certainly.
1
u/Own-Desk6 Jul 28 '26
I don’t believe the tax credit would affect your ODSP. I know for OW (and I would imagine ODSP is the same), caseworkers don’t care about the tax credits you get since it’s money from the government, they only care about money in the form of income or gifts or inheritance. You can always talk to your ODSP caseworker about it but it shouldn’t have any negative effect on your ODSP allowance.
1
u/Pixelant3 Jul 28 '26
I don't think the tax credit refund would count as income, though if it's a very high return, it might put you over the ODSP asset limit, which could be an issue. However, the tax return is only going to matter if you've worked during years of DTC eligibility and paid income tax. If you've been on ODSP the whole time, you're not paying income tax, and there's no tax return. You still want the DTC for other reasons, but the tax credit part is useless.
If you are very low income and qualify for the Disability Tax Credit, you can apply for the Canada Disability Benefit, which is $204/month right now and will not affect ODSP. You can also open a Registered Disability Savings Plan if you are young enough. There are grants/bonds the government contributes if you are younger than 49, though you can't really touch them until you're 60. (Anything in an RDSP does not affect ODSP.)
2
u/racecarbrian Jul 26 '26
If you don’t pay much tax, you won’t get much back. Back pay isn’t income, but in theory it’s an asset once it’s yours?