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Explaining An Act to Strengthen Financial Security for Persons with Disabilities

Sep 19, 2018 11:00:00 AM The MacMillan Estate Planning Team Trust Planning, Community and Social Services, AISH, Minister Irfan Sabir, Assured Income for the Severely Handicapped


The MacMillan Estate Planning team was recently honoured with the opportunity to speak with Alberta’s Minister for Community and Social Services, Irfan Sabir, on our Strongroom Radio Show. Minister Sabir went into detail about financial support through available to disabled residents of Alberta. In particular, we discussed the newly legislated Bill 5, An Act to Strengthen Financial Security for Persons with Disabilities, which amends the current Assured Income for the Severely Handicapped Act.

What Is AISH, and How Has it Changed?

Alberta’s Assured Income for the Severely Handicapped is a social support program for those disabled residents that suffer from a condition that hinders their capability to work and support themselves. AISH is intended to provide some of our most vulnerable citizens with reliable income and government sponsored programs. In the past, its execution has been criticized for offering only minimal support, resulting in many recipients remaining near or below the poverty line.

With the new changes detailed by Minister Sabir, AISH recipients are now able to benefit from advanced estate planning by their loved ones without impact to their eligibility for AISH benefits. Assets in trust are not included in the maximum of $100, 000 in non-exempt assets held by an AISH recipient and their cohabiting partner. Assets in excess of the $100, 000 will impact AISH benefits.

How Does it Compare within Canada?

What exactly does Bill 5 offer to disabled Albertan residents and their families that can’t be found in other provinces? If we compare Alberta’s new legislation to Ontario, we can see that the Act to Strengthen Financial Security for Persons with Disabilities offers numerous advantages.

While AISH now explicitly increases the amount allowed for non-exempt assets, the Ontario Disability Support Program still only allows for up to $40, 000 in non-exempt assets for single applicants and $50, 000 for couples. Furthermore, Alberta residents can hold these assets in either a discretionary or non-discretionary trusts, while in Ontario they can only be held in a discretionary trust. Families in Ontario will often use a Henson trust to provide for disabled loved ones to avoid jeopardizing their government benefits.

Another significant difference is the treatment of trust payments as income. In Ontario, with some exceptions, these payments are counted as income, endangering a recipient’s access to benefits. Cash payments in Alberta from a trust, on the other hand, are considered partially-exempt income. Specifically, the first $200 plus 25% of the remainder of income from a trust is exempt. This offers Alberta recipients greater benefits than those in Ontario.

What Now?

For many people working on their estate plan, providing for a family member with a disability is often a primary concern. We’re happy to see that with this new Act, our Albertan families can have more peace of mind knowing that they can either create a discretionary or non-discretionary trust that, at their preference, can be relied upon to support a disabled family member without compromising their AISH benefits.

If you’re interested in learning more about the Act to Strengthen Financial Security for Persons with Disabilities from the Minister for Community and Social Services himself, we invite you to listen to the Strongroom interview here.

At MacMillan Estate Planning, our team of professional trust and estate practitioners, chartered accountants, financial planners, and legal professionals look forward to assisting you with the design of your estate plan and will ensure you build, protect, and enjoy your wealth. The information provided is general and may not be suited to your objectives or sufficient to ensure the protection of you and your family. You should not act on this information without providing MacMillan Estate Planning with the opportunity to ensure that it is suitable for your unique situation.

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