The Canada Disability Benefit first payments will begin July 2025!
This long awaited and new federal benefit provides direct financial support to people with disabilities who are 18 to 64 years old. The first month of eligibility for the Canada Disability Benefit is June 2025. First payments will begin in July 2025 for applications received and approved by June 30, 2025.
If you qualify for payments, you will begin receiving payments the month after your application is received and approved. If your application is approved in July 2025 or later and you were entitled for payments in earlier months, you will get back payments. There will be no payments for months prior to June 2025.
Eligibility requirements
To qualify for the Canada Disability Benefit:
- you must be between 18 and 64 years old
- you must have been approved for the disability tax credit (administered by Canada Revenue Agency)
- you and your spouse or common-law partner (if applicable) must have filed your 2024 federal income tax return
- you must be a Canadian resident for income tax filing purposes
Maximum benefit you could receive
The maximum amount you could receive from July 2025 to June 2026 is $2,400 ($200 per month). This amount will be adjusted for inflation each year to reflect changes in the cost of living. Your benefit payment will not decrease if the cost of living goes down.
When you apply for the Canada Disability Benefit, you might get back payments for past months that you were eligible. You can receive back payments for up to 24 months from when Service Canada gets your application, but not for any months before July 2025.
Working income exemption
A certain amount of income from employment, self-employment, disability income, and taxable scholarships is excluded when calculating your benefit amount. This is called the working income exemption.
If you are single, up to $10,000 of working income will be exempt when calculating your benefit. If you have a spouse or common-law partner, up to $14,000 of combined working income will be exempt.
Estimate your benefit amount
You can use the online estimator to find out how much money you could get from the Canada Disability Benefits. To get an accurate estimate, start with your and your spouse’s or common law partners, if applicable, most recent CRA notice of assessment to use the exact numbers from various lines in the assessment.
This tool is an estimate only and does not guarantee you will receive the exact amount estimated.
Search Canada Disability Benefit to use the online estimator.
If you are single, separated, divorced or widowed
You will receive the maximum benefit amount if, after subtracting up to $10,000 of working income (if applicable), your net income is $23,000 or less. For every dollar of income that is over this threshold, your benefit will be reduced by 20 cents (20%).
You can calculate your monthly benefit amount with the following steps:
- take your net income
- subtract the amount of your working income, if any, up to $10,000
- subtract $23,000 (if the result is 0 or less, you will receive the maximum benefit amount; if the result is greater than 0, continue to the next step)
- multiply the resulting amount by 0.20 (20%)
- subtract that amount from $2,400
- divide that amount by 12
This can seem complicated, so below are some examples.
Benefit calculation examples
Example 1; an individual receives about $12,000 from Manitoba EIA (Employment Income Assistance) and has no other income. Because the income is below the singles threshold of $23,000, they receive the full benefit. They receive $200 a month as their benefit amount.
Example 2; an individual earns $35,000 a year in employment income and has no other income. Because they earn more than $10,000 from work, they can use the full working income exemption for singles ($10,000). Only $25,000 of their income is considered for the benefit calculation ($35,000 – $10,000). Their income after subtracting the working income exemption is $2,000 over the singles threshold of $23,000 ($25,000 – $23,000). The benefit is reduced by $400 a year ($2,000 x 0.20). This individual receives $166.67 a month as their benefit amount [($2,400 – $400) ÷ 12].
If you are married or have a common law spouse
You will receive the maximum benefit amount if, after subtracting up to $14,000 of combined working income (if applicable), your family income is $32,500 or less. For every dollar of income that’s over this threshold, your benefit will be reduced by 20 cents (20%).
You can calculate your monthly benefit amount with the following steps:
- take your family income
- subtract the combined amount of your and your spouse or common-law partner’s working income, if any, up to $14,000
- subtract $32,500 (if the result is 0 of less, you will receive the maximum benefit amount; if the result is greater than 0, continue to the next step)
- multiply the resulting amount by 0.20 (20%)
- subtract that amount from $2,400
- divide that amount by 12
Example of one spouse claims the DTC
One of the partners is eligible for the disability tax credit and does not work, and the other spouse is working, earning $45,000 a year. The working income exemption for couples ($14,000) is applied to the earnings. Only $31,000 of income is taken into consideration for the calculation of the other spouse’s benefit ($45,000 – $14,000). Because the couple’s income after subtracting the working income exemption is under the couple threshold of $32,500, the one spouse receives the full benefit. They receive $200 a month as the benefit amount.
If both spouses claim the disability tax credit
You will receive the maximum benefit amount if, after subtracting up to $14,000 of combined working income (if applicable), your family income is $32,500 or less. For every dollar of income that’s over this threshold, your benefit and your spouse or common-law partner’s benefit will each be reduced by 10 cents (10%).
Take a married couple in their early 60s. Both are eligible for the Canada Disability Benefit because they have been approved for the disability tax credit.
One is self-employed and earns $5,000 and the other receives $15,000 in Canada Pension Plan Disability benefits and they also receive $25,000 from other sources of income that is taxable. Their family income is therefore $45,000.
Because one earns less than $14,000 from work (the working income exemption for couples), all of their working income ($5,000) is exempt. Only $40,000 of their income is taken into consideration for the benefit calculation ($45,000 – $5,000). The couple’s income after subtracting the working income exemption is $7,500 over the couple threshold of $32,500 ($40,000 – $32,500). Their benefits are each reduced by $750 a year ($7,500 x 0.1). They both receive $137.50 a month as their benefit amount [($2,400 – $750) ÷ 12].
How to Apply
If you received a letter from Service Canada, the letter has a unique 6-digit application code that can be used to apply for the Canada Disability Benefit. To apply, you will need to provide your:
- unique application code found on the upper right-hand corner of the letter from Service Canada, inviting you to apply
- Social Insurance Number (SIN)
- If your banking info is already on file with CRA Canada Revenue Agency to receive tax refunds and benefit payments like GST credit, then you do NOT need to provide your banking information
If you did not receive a letter from Service Canada, to apply, you’ll need to provide your:
- Social Insurance Number (SIN)
- mailing address
- net income (line 23600) from your 2024 notice of assessment. Providing this will speed up application processing and payments if eligible.
- If your banking info is already on file with Canada Revenue Agency to receive tax refunds and benefit payments like GST credit, then you do NOT need to provide your banking information
Payment dates
If you qualify for payments, you’ll be paid the month after your application is approved. Payments are sent on the 3rd Thursday of each month.
If your total yearly payment is less than $240 ($20 a month), you’ll receive one lump sum payment for the full year (instead of monthly payments).
Waiting for a decision
Service Canada will review your application. A letter with an eligibility decision will be sent to you within 28 calendar days of applying for the benefit.
Not taxable
This new benefit is NOT taxable and does not impact other benefits such as EIA Employment and Income Assistance.
This is a welcomed new benefit for many individuals who qualify for the disability tax credit with lower income.
If you need any help applying for the Canada Disability Benefit, please feel free to contact our office, even if you are not a current client.
Canadian Dental Care Plan
And a reminder to apply for or renew your coverage through the CDCP Canadian Dental Care Plan if you qualify. You must renew each year to continue your coverage. If you are late applying or renewing, your coverage may be delayed for a month or two. And if you need help applying or renewing your coverage, please let us know if we can help!
Anni Markmann is a Personal Income Tax Professional and Certified Financial Planner; living, working, and volunteering in our community. Contact Ste Anne Tax Service at 204.422.6631 or 36 Dawson Road in Ste Anne (near Clearview Co-op) or Info@SteAnneTaxService.ca