How does an inheritance affect my ODSP benefits in Ontario?

Yes, an inheritance can affect your ODSP, so you must report any inheritance you receive or expect to receive. An inheritance is generally treated as income in the month it is received, and any amount left the following month is generally treated as an asset.

ODSP asset limits are $40,000 for a single person and $50,000 for a couple, plus $500 for each dependant other than a spouse. If you place an inheritance or life insurance proceeds in a trust, up to $100,000 is exempt as an asset, which is a combined limit with the cash surrender value of any life insurance policies you own. A trust where the trustee has absolute and sole discretion over payments is not an asset, so its capital can exceed $100,000, but you cannot put your own inheritance into one to avoid the limit.

Payments from a trust to you are exempt as income up to $10,000 in a 12-month period if an annual report of all trust transactions is filed; other payments count as income in the month received. These policies can change and are applied case by case, so speak with a lawyer before you accept or spend an inheritance.