16 May 2001 Internal T.I. 2001-0076767 - PAYMENT TO DISABLED - PDD PROGRAM

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.

Principal Issues:

Does a payment made to a parent of a disabled person under a provincial program a non-taxable receipt to the recipient?

Position TAKEN:

YES.

Reasons FOR POSITION TAKEN:

Eligibility for program is not a means or income test
Similar Decisions in 9904707 and 9901955

		May 16, 2001

	CALGARY TSO	HEADQUARTERS
C. Tremblay, CMA
	Attention: Kiram Sandhu  	957-2139
	Room 132
		2001-007676

XXXXXXXXXX
Payment to a parent of a disabled adult -
Persons with Developmental Disabilities

This is in response to your memorandum of March 23, 2001, requesting our opinion on the tax treatment of the payment received by XXXXXXXXXX from the Southern Alberta Community Board to look after her disabled adult daughter in her home.

You state that XXXXXXXXXX has a XXXXXXXXXX daughter with Down's Syndrome. As part of the Persons with Developmental Disabilities funding supports program ("PDD Program"), the Southern Alberta Community Board pays XXXXXXXXXX a month for providing care to her daughter.

In the past we have addressed similar issues dealing with the taxation of various types of payments made to disabled individuals under the Employment Supports Program of the Ontario Disability Support Program (Document Number E 9901955) and to disabled children under with the Employment Assistance for People with Disabilities Program and the Family Support Program administered by the province of Prince Edward Island (Document Number E9904707). We opined that:

(1) if the payment is based on a means, needs or income test it is social assistance taxable under paragraph 56(1)(u) of the Act,

(2) if the payment is for tuition and training costs it is taxable under paragraph 56(1)(n) of the Act,

(3) if the payment is for wage subsidies it is taxable under section 5 of the Act as employment income,

(4) if the payment is assistance to self-employed individuals it is taxable under paragraph 12(1)(x) of the Act,

(5) and all other payments are not taxable.

Based on the information provided by the South Alberta Community Board, it does not appear that the recipients of these benefits have to meet a means, needs or income test. In the particular situation you presented, the payments would be in accordance with (5) above as the payments made under the PDD Program are based on a particular individual's disability, among other things, and not on income needs of the individual.

For your information a copy of this memorandum will be severed using the Access to Information Act criteria and placed in the Legislation Access Database (LAD) on CCRA's mainframe computer. A severed copy will also be distributed to the commercial tax publishers for inclusion in their databases. The severing process will remove all material that is not subject to disclosure, including information that could disclose the identity of the taxpayer. Should your client request a copy of this memorandum, they can be provided with the LAD version, or they may request a copy severed using the Privacy Act criteria, which does not remove client identity. You should make request for this latter version to Jackie Page at

(819) 994-2898. The severed copy will be sent to you for delivery to the client.

Steve Tevlin
for Director
Business and Partnerships Division
Income Tax Rulings Directorate
Policy and Legislation Branch

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