- You must report an inheritance you receive or expect to receive to ODSP, including money received by anyone in your family.
- Inherited money is generally income in the month you get it, and any amount still held the next month is treated as an asset.
- Not reporting can create an overpayment that must be repaid, even after you leave ODSP.
Being named in someone's will, or being entitled to a share of an estate, can be good news and stressful news at the same time if you receive support from the Ontario Disability Support Program (ODSP). The rules about income and assets mean that a sudden amount of money can affect your monthly support.
This article explains in plain terms what ODSP asks you to report, how an inheritance is counted, which amounts and kinds of property may be protected, and what happens if you do not report. Because your situation depends on the details, it is a starting point for a conversation with a lawyer or your caseworker, not a substitute for one.
You must report an inheritance, even one you are only expecting
ODSP recipients must report income or other money that they or anyone in their family receives. The listed examples include a windfall such as an inheritance. You must also tell your caseworker about any inheritance you receive or expect to receive.
That means you should not wait until the estate is paid out. If you know you are a beneficiary and money or property is likely to come to you, raise it with ODSP early.
How to report it
Asset changes and new assets can be reported online through MyBenefits, by phone or by mail. Your report should include the nine-digit member ID shown on your monthly statement. The official guidance does not set a specific number of days for reporting. Even so, reporting promptly is the safest approach.
- Find your nine-digit member ID on your monthly statement.
- Write down what you are receiving or expect to receive, and from which estate.
- Keep a copy of any letter from the estate trustee or the estate's lawyer.
- Report through MyBenefits, by phone or by mail, and keep a record of when and how you did so.
How an inheritance is counted: income, then assets
Inherited money is generally treated as income in the month you receive it. Any amount you still hold the following month is treated as an asset.
There is an allowance that can help. You and each family member can receive up to $10,000 in total in a 12-month period from gifts, inheritances, trust and life insurance payments and lottery winnings without affecting your income support. Amounts above $10,000 count as income in the month received, unless they are used for an approved disability-related item or service.
After that, the asset limits matter. The limit on non-exempt assets is $40,000 for a single person and $50,000 for a couple. These figures are current guidance and change from time to time, so confirm them before you rely on them.
Trusts and inherited property
Money held in trust can be treated differently. Up to $100,000 of a trust may be exempt as an asset if the trust was funded by an inheritance or life insurance. An inherited trust set up in a will is not considered income, and inherited money placed in a trust within six months may also qualify for the exemption.
Inherited property or possessions, rather than cash, are treated as assets, not income. Some are exempt, such as a home you live in or a car used as your primary vehicle.
If you want to understand how a trust for a person with a disability works, see our existing article on Henson trusts in Ontario. A trust has to be set up properly to get the benefit, so it is worth getting legal advice before moving any money.
| What you receive | How ODSP generally treats it |
|---|---|
| Cash inheritance | Income in the month received; any amount held the next month is an asset |
| Up to $10,000 in 12 months from gifts, inheritances and similar sources | Does not affect income support |
| Inherited trust set up in a will | Not considered income; up to $100,000 may be exempt as an asset |
| Home you live in or primary car | Treated as an asset, but may be exempt |
What happens if you do not report
If you do not report, you may receive money you were not eligible for. That is an overpayment, and it must be repaid, including after you leave ODSP. While you are still on ODSP, deductions are taken from your monthly income support until it is repaid.
Be careful about refusing an inheritance to avoid the problem. Disclaiming an inheritance may itself count as a gift or income for ODSP purposes, so get advice before you sign anything.
What to do next
- Tell your caseworker as soon as you learn you are a beneficiary.
- Ask the estate trustee for a written summary of what you are expected to receive and when.
- Ask the estate trustee to hold off on paying you directly until you have talked to a lawyer about whether a trust is suitable.
- Do not sign a disclaimer or spend a large amount before getting advice.
- Confirm the current ODSP figures with your caseworker or on the Ontario government website.
A lawyer can look at the will, the amount involved and your family situation, and explain your options. Your caseworker can confirm how ODSP will treat your particular amount.
Frequently asked questions
Do I have to report an inheritance I have not received yet?
Yes. ODSP asks you to report any inheritance you receive or expect to receive to your caseworker. Telling them early gives you time to plan before the money arrives.
Is there a deadline in days to report an inheritance?
The official guidance does not give a specific number of days. Report as soon as you know, using MyBenefits, by phone or by mail, with your nine-digit member ID.
Will a $10,000 inheritance cut off my ODSP?
Not necessarily. You and each family member can receive up to $10,000 in total in a 12-month period from gifts, inheritances, trust and life insurance payments and lottery winnings without affecting income support. Amounts above that count as income in the month received unless they are used for an approved disability-related item or service.
Can I keep my inheritance in a trust?
Possibly. Up to $100,000 of a trust may be exempt as an asset if it was funded by an inheritance or life insurance, and money placed in trust within six months may also qualify. The trust needs to be set up correctly, so speak to a lawyer first.
Sources
- Ontario.ca – Rights and responsibilities of ODSP clients and beneficiaries — ontario.ca
- Ontario.ca – ODSP eligibility for income support — ontario.ca
Links go to official government, court and regulator pages. The law changes — confirm you are reading the current version.
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