Does inheritance affect disability benefits BC?

Inheritances are exempt for people on PWD. However, you must declare the inheritance to the Ministry on your Monthly Report. It is considered exempt as income and exempt up to your asset level, which for a single person is $100,000.

How much does it cost to set up a trust in BC?

If you create a trust that takes effect while you are alive – known as a living trust or inter vivos trust – it will cost at least $1,000 to set up and establish. For a large trust, you will need to appoint a trustee to oversee it and manage investments held within the trust.

What is a Henson Trust BC?

A Henson trust is a trust that gives the trustee the absolute discretion to decide how much of the money held in trust will be available for the child. The child has no legal right to demand more money from the trust and on the child’s death the remaining capital will be left to another named beneficiary.

How much money can you inherit on disability?

Persons with Disabilities (PWD) recipients can now receive and keep up to $100,000 in gifts or inheritances, without impacting their entitlement to monthly government disability assistance. This is a substantial increase from the previous limit of $5,000.

How much money can you have in the bank on disability BC?

1, the amount in assets that disabled people can hold will rise to $100,000 for individuals who have the persons with disabilities designation and $200,000 for couples in the same situation. Currently, the asset limits are $5,000 for individuals and $10,000 for couples.

What is the difference between a complex trust and a qualified disability trust?

A Trust that does not require distribution of all its income by the terms of the trust agreement is called a “Complex” Trust, and is allowed an exemption of $100. A “Qualified Disability Trust” or “QDT” is allowed the same exemption as an individual under IRS Code §642(b)(2)(C).

How do I start a special disability trust?

A Special Disability Trust can be set up while the parents are alive, or specific instructions can be laid out in their Wills. The legislation requires that the Special Disability Trust is set up by a trust deed or Will, using a Model Special Disability Trust (prescribed by social security rules).

Is a Henson Trust a good idea?

A Henson Trust can result in an overall tax savings. It may be possible to have income earned in the trust taxed at the marginal tax rate of the disabled beneficiary rather than at the highest marginal tax rate as would be the case if the trust was set up as a regular inter vivos trust.

How much does it cost to set up a Henson Trust?

The cost of setting up a Henson Trust is an issue for amounts of $100,000 or less. In these cases, an inheritance trust may make more sense. Trustees are entitled to an annual fee, which is a percentage of assets. This is typically 2% to 2.5%.