Changes to Ministry of Social Development Policy Now Allows Up To $200,000 in Non-Discretionary Trust

The British Columbia Ministry of Social Development changed its policy to allow a person receiving disability assistance to place up to $200,000 in a non-discretionary trust effective October 1, 2012. This is an increase from $100,000.

Provincial disability benefits are means tested. If a person who meets the criteria for a Person with Disabilities, that person may receive disability assistance if his or her income and assets are below certain levels. In determining a person’s assets, there are assets that are exempt. An interest in a non-discretionary trust is exempt if the assets in the trust do not exceed $200,000. The former limit was $100,000. There is no limit for assets held in a discretionary trust.

The terms “discretionary” and “non-discretionary” trusts are defined in the policy:

Discretionary trust
A trust in which the trustee has absolute authority over payments of capital and income from the trust. 

Non-Discretionary Trust
A trust in which the trustee does not have absolute authority over payments of capital and income from the trust.  The beneficiary may have some control, or the trustee may be required to make certain payments.

The Ministry has made a number of other changes. According to the announcement made October 1, 2012:

Some of the key changes that take effect today include:

• A $200 monthly earnings exemption for all expected-to-work clients to give employable individuals a chance to build job skills and experience, take advantage of short-term or temporary work, and better provide for their families while receiving assistance.

• An $800 monthly earnings exemption for individuals receiving disability assistance.

• An exemption of income tax refunds so individuals and families on income and disability assistance will be able to keep their full income tax refund without it affecting their benefits.

• Restoring a number of medically necessary medical equipment and supplies for clients on income and disability assistance, including ventilator supplies, bariatric scooters, orthoses and apnea monitors.

• Access to dental services for children of families on hardship assistance so parents can take their children in for regular dental checkups.

• An extension of income assistance to parents without legal status in Canada who are fleeing abuse and can't leave the country with their children.

Further changes will come into effect next year, including: 

• Mandatory income tax filing rules for those on income and disability assistance - which comes into effect in spring 2013 - will ensure individuals and families are getting all the tax credits they are entitled to. Appropriate exemptions will be in place to protect anyone who may be exposed to risk, such as fleeing an abusive partner.

• Annualized earnings exemptions for individuals on disability assistance will provide the flexibility to calculate earnings on an annual basis, so that individuals with disabilities can maximize their earnings during times when they are feeling healthy and able to work.