BC: Earnings Exemptions

These policies really hurt individuals from living together to save money such as older children, spouses, and older parents. I have even heard from parents where the government has actually seized money earned by a child for a newspaper route. There really is no support from our government for families or children. Click here to learn more or read an excerpt below. Read more about Income Treatment & Exemptions.

 

Effective: September 1, 2016

Earnings exemptions provide clients who work with the ability to keep additional income over and above their monthly assistance payment, offering them an opportunity to build job skills and experience to increase employability, take advantage of part-time or temporary work, and better provide for their families while receiving assistance.

To be eligible for an earnings exemption, clients must have been in receipt of eitherincome assistance or disability assistance for the previous month. If no assistance was issued in the previous month, a one month wait must be served before the family unit is eligible for the earnings exemption.

Note: Persons with Disabilities (PWD) designated clients who have previously received disability assistance in the past and are now reapplying for assistance (returning PWD clients) do not have a one month wait period.

Each family unit is eligible for an earnings exemption. The highest exemption that applies to a family unit composition will be provided each month, they cannot be combined. For example, if a PPMB client is a single parent, they are eligible for the $500/month PPMB earnings exemption, as it is higher than the $400/month family unit with a dependent child exemption.

Earnings Exemptions are not available to recipients of hardship assistance.

Monthly Earnings Exemption – Income Assistance

Income assistance clients are eligible for a monthly earnings exemption.  The level of exemption is based on family unit size and composition – see table below.

The monthly earnings exemption can only be applied to earned income.  Earned income is any of the following:

  • any money or value received in exchange for work or the provision of a service
  • pension plan contributions that are refunded because of insufficient contributions to create a pension
  • money or value received from providing room and board at a person’s place of residence
  • money or value received from renting rooms that are common to and part of a person’s place of residence
Income Assistance
Eligible Clients Earnings Exemption Amount (per month)
All family units, including individuals eligible for income assistance who are not listed below $200
All family units with a dependent child or caring for a supported child $400
A family unit where at least one individual is a Person with Persistent Multiple Barriers (PPMB) $500
All family units with a dependent child with a severe disability or who care for a supported child with a severe disability where the disability of the child precludes a parent from working outside the home for more than 30 hours per week $500

For more information on income eligible for earning exemptions, see Policy, Employment Income – Income Assistance Recipients, Rental Income and Self Employment Program Income

Annual Earnings Exemption – Disability Assistance

Disability assistance clients are eligible for an annual earnings exemption (AEE).  The AEE allows individuals on disability assistance to use their earnings exemption on an annual, instead of monthly, basis and without a monthly maximum.  The intent of AEE is to better assist individuals whose ability to earn fluctuates during the year, for example, due to medical conditions.

A family unit’s annual exemption limit is based on family unit size, composition and number of qualifying months in the calendar year – see table below under AEE limits.

The annual earnings exemption can only be applied to qualifying income.  Qualifying income is either of the following:

  • Earned income, meaning:
    • any money or value received in exchange for work or the provision of a service,
    • pension plan contributions that are refunded because of insufficient contributions to create a pension,
    • money or value received from providing room and board at a person’s place of residence,
    • money or value received from renting rooms that are common to and part of a person’s place of residence; and
  • Unearned income that is compensation paid under section 29 or 30 of the Workers Compensation Act (WCB temporary wage loss replacement benefits)

Each calendar year, AEE covers qualifying income received from January 1 to December 31, for March to February assistance months.

First time disability assistance recipients are required to serve a one month waiting period before being eligible for the exemption unless they received income assistance in the previous month. Family units who were in receipt of either income assistance or disability assistance for the previous month or returning PWD designated clients who have previously received disability assistance, have no wait period.

PWD designated clients in receipt of Medical Services Only coverage as a result of employment income should continue to submit monthly reports in order for the ministry to re-establish eligibility for disability assistance when:

  1. the client’s income falls below the disability assistance rate; or
  2. the client is eligible for an annual earnings exemption in the new calendar year

[For more information, see Related Links – BCEA Application – Stage 1 – Prospecting – Medical Services Only Clients Requesting Assistance].

AEE limits

A family unit’s AEE limit is established in the initial qualifying month for the family unit and calculated using the base amount for the family unit multiplied by the number of qualifying months remaining in the calendar year.

Disability Assistance
Eligible Clients Base amount
(multiplied by the # of qualifying months in the calendar year)
Maximum Annual Earnings Exemption
(full calendar year)
A family unit with one adult recipient who has the PWD designation $800 $9,600
A family unit with two adult recipients where only one recipient has the PWD designation $1,000 $12,000
A family unit where both individuals have the PWD designation $1,600 $19,200

Under the AEE, there is only an annual exemption limit – there is no monthly maximum.  Once the family unit is eligible for earnings exemptions, the amount of a family unit’s disability assistance is not impacted by earnings received up to the family unit’s AEE limit. Once a family unit’s AEE limit is reached, any additional earnings received will be deducted dollar for dollar from their disability assistance.

Each calendar year is a new exemption year. Any remaining exemption from the previous year does not carry over into the new exemption year.

In a family unit containing two recipients, both recipients do not have to be employed to be eligible for the maximum exemption.  As long as there are two recipients in the family unit, they are eligible for the full exemption, regardless of who earns the income.

Combined Income:

Some family units may receive a combination of income where there are two types of qualifying income.

For example: A PWD recipient receives $700 in WCB temporary wage loss replacement benefits and their spouse earns $500 in employment income.  The total combined qualifying income is $1,200. As long as the family unit has enough limit remaining in their annual earning exemption, they would be eligible for a total exemption of $1,200.  Any non-qualifying income would be deducted from their disability assistance.

For more information on earnings exemptions, see Policy, Employment Income – Disability Assistance Recipients, Rental Income, Self Employment Program Income and Workers’ Compensation Board

Change in Family Circumstances

If there is a change in family circumstances during the calendar year, then the amount remaining in the family unit’s AEE limit will be adjusted (increased or decreased) based on the circumstances of that change (e.g.: the addition of spouse to a family unit or separation from a spouse or a period of ineligibility within the year).

Note: Separation from or addition of a spouse results in the formation of a new family unit. The AEE limit for this new family unit will be established starting with a new initial qualifying month.

Family Separation: When couples on disability assistance separate in the middle of the exemption year, the individuals move onto their own cases and no longer share an AEE limit. Each PWD client will have their AEE limit pro-rated for the remainder of the year, starting the month after the couple separates. Qualifying income declared in the exemption year prior to the separation is not deducted from the pro-rated amount. Individuals who do not have the PWD designation and remain on income assistance will change over to the applicable monthly earnings exemption.

Leaving Assistance and Returning within the Exemption Year: When an individual or family on disability assistance (DA) is no longer receiving DA and begins receiving assistance in the same year, their AEE limit upon return is prorated because they were only receiving DA for a portion of the exemption year.  Qualifying income while they were previously eligible is deducted from the prorated amount. Income received while off of assistance is not counted.

When a PWD client is no longer receiving DA and later begins receiving assistance as part of a new family unit (change in family composition) all within the same exemption year, the new family unit’s AEE will be a combined total of the residual AEE room of both individuals taking into account any period of ineligibility for assistance.

[For details on the calculations used to establish the AEE limit in the initial qualifying month and subsequent months, see Additional Resources – Policy Summary of AEE Regulation]

It is important for clients using the AEE to keep track of their earnings and the remaining amount of their AEE limit.  Clients may want to use the AEE Income Tracking Sheet [see  Additional Resources]. In addition, the ministry will send PWD clients an income threshold letter (HR3508) if they reach or exceed 75 percent of their AEE limit [see Forms and Letters].

If a PWD client has used up their AEE limit for the exemption year, any additional earned income is deducted dollar for dollar from their DA.  If earnings exceed the amount of disability assistance, the client will be eligible for Medical Services Only coverage. [see Related Links – Medical Services Only]

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