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Ministry of Social Development and Social Innovation

Frequently Asked Questions

What is the difference between the monthly earnings exemption and the annualized earnings exemption (AEE)?

Monthly Earnings Exemption:

  • The monthly earnings exemption allows you to keep up to the following amount of earned income each month:
    • Single individual with PWD designation or a family with one adult who has the PWD designation - $800.
    • Couple or family with two adults where only one has the PWD designation - $1,000.
    • Couple or family with two adults where both have the PWD designation - $1,600.
  • Earned income over these monthly limits is deducted from your disability assistance cheque.

Annualized Earnings Exemption:

  • The AEE allows you to keep up to the following amount of earned income each year:
    • Single individual with PWD designation or a family with one adult who has the PWD designation - $9,600.
    • Couple or family with two adults where only one has the PWD designation - $12,000.
    • Couple or family with two adults where both adults have the PWD designation - $19,200.
  • These amounts are equivalent to 12 times the monthly exemption limit for the calendar year. If there is a change in family circumstances during the exemption year, the amount of the family unit’s AEE limit will be adjusted based on the circumstances of that change.
  • Under the AEE, you are able to earn up to your AEE limit during the year, with no monthly maximums, without affecting your monthly disability benefits.
    • For example, if a single individual with the PWD designation earns more than the $800 monthly maximum, they will be able to keep all that money up to a maximum total of $9,600 for the year.
  • This may be particularly helpful if your ability to earn fluctuates during the year; for example, due to a medical condition - exceeding the monthly exemption limit some months yet earning little or nothing in other months.
  • As with the monthly exemption, if your AEE limit is reached, any additional earnings you receive will be deducted dollar for dollar from your disability assistance.
  • This is important to note, as this will impact the amount of your monthly income. You may need to budget your money if you earn over the AEE limit before the end of the calendar year.

What is the benefit of the AEE?

  • The AEE provides more flexibility for people receiving disability assistance who can only work occasionally during the year. It allows them to keep more of the money they earn when they are able to work.
  • The AEE can be an advantage for individuals who earn income sporadically; for example, due to medical conditions - exceeding the monthly exemption limit some months yet earning little or nothing in other months.
    • For example, if your income fluctuates and you earn more than $800 in a month, you will be able to keep all of that money up to a maximum total of $9,600 for the year. There is no monthly maximum.
  • The AEE supports employment, which can be a particular challenge for people with disabilities – especially those with episodic conditions who are more likely to work only part of the year.
  • The AEE treats individuals who can earn income in only one or two months equally to those who are able to earn steadily over the entire year.

When did the AEE start?

  • The AEE is being phased in and the first year ran from Jan. 1 to Dec. 31, 2013.
  • In 2014, the exemption is based on earned income received from Jan. 1 to Dec. 31, 2014. Due to the income reporting process, this timeframe impacts benefit months from March 2014 to February 2015.
  • This is how it works:
    • You report the amount of earned income you received in January to the ministry on your cheque stub that must be submitted by Feb. 5.
    • This information is processed by the ministry and your earnings are applied to your March assistance cheque which you receive at the end of February.

What happens if I use up my AEE?

  • As with the monthly exemption, if your AEE is reached, any additional earnings you receive will be deducted dollar for dollar from your disability assistance.
  • If your monthly earnings continue to be over disability assistance rates, you will not receive a disability assistance cheque but you may be eligible for Medical Services Only (MSO) coverage.
  • More information on MSO coverage can be found on the Online Resource.

I chose AEE in 2013 but didn’t use up my full AEE for the year. Can I add the left over limit to my 2014 AEE limit?

  • No, 2014 is a new exemption year. Any remaining exemption from the previous year does not carry over into the new exemption year.

Who can apply for the AEE?

  • The AEE is being introduced in a phased approach.
  • Initially, the annualized exemption is being offered to those families receiving disability assistance who are most likely to benefit from it, including those with sporadic incomes throughout the year that have exceeded the monthly limit.
  • Only people who meet the AEE eligibility criteria and are sent a notification letter from the ministry are eligible to choose AEE for 2014.
  • We have consulted with a number of disability groups and they are supportive of our phased approach.

Why was I selected for the AEE?

  • The people selected were chosen by the ministry because they are most likely to benefit based on their earnings from the past year. That means you (or someone in your family) participated in the AEE for 2013 or:
    • has had the PWD designation for at least the past 12 months;
    • received disability assistance in at least the past two consecutive months; and,
    • had earnings over the monthly earnings exemption limit in at least one of the past 12 months ($500 a month for a single individual with PWD designation or $750 a month for a couple who both have PWD designations).
  • Based on this, you received a notification letter for the 2014 exemption year and had until Jan. 28, 2014 to notify the ministry if you wanted to choose AEE for 2014. Please note: the original registration deadline of Jan. 14th was extended to Jan. 28th 2014.
  • Choosing the annualized exemption instead of the monthly exemption is completely optional.

How do I register for the AEE for 2014?

  • Registration for the AEE for 2014 closed on Jan. 28, 2014.

If I sign up, then change my mind, can I switch back to the monthly earnings exemption?

  • Choosing the AEE for 2014 was optional. However, if you did register for AEE, you will be obligated to participate in AEE for the full 2014 exemption year.
  • The only exception to this is when an individual who has chosen the annualized exemption becomes part of a couple during the exemption year. If their new partner did not choose the annualized exemption, the couple will be asked to choose between the monthly and annual exemption option.

What if I chose AEE but my new spouse doesn’t want to participate?

  • If there are two adults in the new family unit, they must agree on the choice to have the AEE.
  • If spouses cannot agree, exemptions for the new family unit will be applied monthly.

Can someone who hasn’t been selected for AEE 2014 apply?

  • No. Only those people who were selected by the ministry that meet the eligibility criteria and register by the Jan. 28 deadline will be able to participate in 2014.

Why is the AEE not open to everyone who receives disability assistance now?

  • Since British Columbia is one of the first places in Canada to offer the AEE, and introducing a new exemption option is complicated, AEE is being introduced in phases.
  • This phased approach will allow the ministry to monitor the program and make necessary changes before opening the program up to all individuals on disability assistance.
  • In 2014, the ministry will gather more information and feedback from the people we serve in order to fully understand the circumstances that are best suited for the AEE.
  • The ministry has consulted with a number of disability groups and they are supportive of our phased approach.

If I choose the AEE, what will I need to do during the year?

  • You must:
    • Submit your Monthly Report (cheque stub) before the 5th of each month, declaring earned income received each month, even if the amount of your earned income does not change and;
    • Advise the ministry of any changes in circumstances (if you join with or separate from a spouse) because the amount of your earnings exemption limit may change.
  • You may be asked to take part in a confidential evaluation of the AEE. This will be your opportunity to tell us how the AEE has worked for you.

What type of income can be exempted?

  • Earnings exemptions apply to earned income. For example: money you receive from work or from someone who pays you rent or room and board.
  • Income received as Workers Compensation Board (WCB) Temporary Wage Loss Replacement Payments can also be considered under this exemption. These are payments issued under Sections 29 and 30 of the Workers Compensation Act.

How will I keep track of my AEE limit?

  • It is important for you to keep track of your earnings and the remaining amount of your AEE limit. Keep copies of your monthly paystubs and receipts from rental or room and board income.
  • To assist you for AEE 2014, the ministry will send you a monthly letter with the following information:
    • The total earned income you declared that month and;
    • The remaining amount of your AEE limit.

If you have any additional questions, please call 1 866-866-0800

Below are two examples showing the difference between a monthly earnings exemption and the AEE.

Example 1:

Susan receives $906.42 per month on Disability Assistance (DA) and earns $1,200 each month at her job. With the monthly exemption, she receives a total of $1,706.42 each month. Susan keeps her full pay cheque and her DA cheque is $506.42 (a reduction of $400).

With the annual exemption, Susan would keep her full pay cheque each month for eight months and remain eligible for full DA until September when she reaches her $9,600 AEE limit. From October to December she would continue to keep her full pay cheque but she would not be eligible for a DA cheque.

Here’s a chart that breaks down Susan’s earnings for the earnings exemption and the AEE:

Click on image for a larger view

Example 2:

John receives $906.42 on Disability Assistance (DA) and is only able to work a few months of the year due to health problems. John starts work and declares $1,250 earnings for May.

  • Under the monthly exemption, he receives a total of $1,706.42. John keeps his full pay cheque and his DA cheque is $456.42 (a reduction of $450).
  • Under the annual exemption, he would receive a total of $2,156.42. John would keep his full $1,250 pay cheque and $906.42 DA for that month. His AEE limit is reduced from $9,600 to $8,350.

John’s work increases for June to August and he makes $2,500 each month.

  • Under the monthly exemption, he would stop receiving DA due to his increased monthly income. $800 of John’s income would be exempted but the remaining $1,700 is still more than his DA rate. In each of these months, John’s receives $2,500 from working and $0 from DA.
  • Under the annual exemption, John would receive $3,406.42 each month. He keeps his full $2,500 paycheque and $906.42 from DA. He remains eligible for full DA because he has not reached his $9,600 AEE limit for the year. His AEE balance remaining is $850.

John is unable to work from September to November due to health problems.

  • Under the monthly exemption, John receives $0 from working and $906.42 DA each month.
  • Under the annual exemption, John would receive $0 from working and $906.42 DA each month.

John returns to work in December and makes $2,500.

  • Under the monthly exemption, John receives $2,500 from working and $0 from DA.
  • Under the annual exemption, John would receive $2,500 from working and $0 from DA because he has used up his full AEE limit for the year.

Here is a chart that breaks down John’s earnings for the earnings exemption and the AEE:

Click on image for a larger view