Child Disability Benefit

1. Child Disability Benefit By: Stephanie Chan Vanessa Huang Oliver Keung Raymond Sam Lucy Tseng

2. What is Canada Child Tax Benefit? • Joint program made by federal, provincial and territorial governments • Provide families with tax-free monthly payments to help raise children of age 18 or under • On average, CCTB pays $1255 for the first child, and provides more funding for additional children

3. Eligibility for CCTB • Must live with the child • Be the primary caretaker • Caretaker and/or spouse must be residents of Canada

4. Other programs offered under CCTB • Automatically considered for the following programs when approved for CCTB • National Child Benefit Supplement • Universal Child Care Benefit • Child Disability Benefit

5. Child Disability Benefit (CDB) • Objective: Assist children with severe and prolonged impairment living in low income families • Developed in 2003 under the Canada Child Tax Benefit (CCTB) • Tax-free benefit of up to $2,300 per year or $191.66 per month

6. Eligibility for CDB • Child must be under 18 years old and be eligible for the Canadian Child Tax Benefit • Child must be eligible for the “disability amount”

7. What is the Disability Amount? • It is a non-refundable tax credit and it reduces the amount of income tax payable. • Qualified practitioner proves that child is markedly or significantly restricted in participating in basic daily activities • Or the child spends at least 14 hours per week on life-sustaining therapy • Impairment expected to last at least 12 months

8. How to apply for CDB? • Must first be eligible for CCTB • File a Disability Tax Credit Certificate - Form T2201 • Must be signed by a qualified practitioner • Submit form to nearest tax centre • Decision for eligibility made by the Canada Revenue Agency (CRA)

9. CDB Calculation • Calculated according to base income • Based on number of children for which CCTB is received • Receive maximum CDB benefit if family net income is less than base amount for the family size

10. CDB calculation example For tax year 2006-2007 Calculations based on family consisting of parents and 1 disabled child with net income below $20,435 Basic CCTB $1,255 Plus NCBS $1,945 ---------- Total $3,200 CDB $2,300 Threshold income for CDB is $36,378 Net total $5,500 or $458.33/month

11. Income earned VS entitlement to CDB • As income goes up, CDB is reduced at the rate of 2% for one qualified child and at 4% for two or more qualified children • Nearly all families with children eligible for CDB will receive this benefit

12. No CDB VS CDB

13. Child Disability Benefit Criticism • The government could use the funding for other programs • Families receiving Child Disability Benefit could misuse the funding • Use the money for purpose other than improving the child’s life • Family may stop working extra hours due to the extra funding from CDB

14. Improvements made to the policy since 2006 • Increased maximum annual benefit from $2,300 to $2,351 that a family can receive • Families can use the extra cash to buy medical or health support for the disabled child • CDB eligibility have been extended to middle and higher income families with qualified child.

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