Income Boosting Benefits and How To Get Them
For families on social assistance with children, benefit income can add up to almost 40% of their annual household income. Evidence from Canada and the U.S. shows that many low-income earners can quickly increase their family’s income by as much as 50% by accessing benefits they are entitled to.
TOOLS and STRATEGIES to ACCESS BENEFITS
SEED Winnipeg generally defines a ‘benefit’ as a payment you may be eligible to receive from the government, usually from the Province of Manitoba or the federal government of Canada. What we are not talking about here are benefits such as employer health and dental care.
Most of these benefits can only be accessed if you file your personal income taxes on a regular basis, so it’s important to keep your tax filings up to date. If you need help with the process, there are organizations like Community Financial Counselling Services that help people for little to no cost.
TAX DEDUCTIONS, TAX CREDITS, AND OTHER BENEFITS
Tax deductions, tax credits and tax benefits offered by the provincial or federal government can be confusing terms that need a bit of explanation.
Tax Deductions are benefits that reduce your taxable income. For example, an RSP contribution. They are subtracted from your taxable income before income tax is calculated, to reduce the amount of tax you have to pay.
Tax Credits reduce the amount of taxes you will owe after your income tax is calculated. There are two types of tax credits: Non-Refundable and Refundable. If you owe income taxes, a non-refundable tax credit will reduce this amount. But, if you have more non-refundable tax credits than what you owe, you will not get a refund for the difference. Examples of Non-Refundable tax credits include Medical Expenses Tax Credit, Charity Tax Credit, Disability Tax Credit, etc.
This is different from Refundable Tax Credits. A Refundable Tax Credit will reduce the amount you owe, and it will provide you a refund if the Refundable Tax Credit is more than the income tax that you owe. An example of a Refundable Tax Credit is the Canada Worker Benefit and the Climate Action Incentive.
People who meet the income criteria and file their taxes may be eligible for Tax benefits such as GST Credit, Canada Child Benefit, etc. Tax Benefits are generally paid on a regular basis throughout the year.
Other Benefits include Social Assistance Programs, Benefits for Special Groups, and Emergency Benefits.
Social Assistance Programs help low-income earners pay for basic needs such as food and shelter, and sometimes pharmaceutical and dental services. In Manitoba this is called Employment and Income Assistant (EIA) and includes benefits such as the Rent Assist Program.
Benefits for Special Groups help specific groups of people such as those living with a disability, individuals with children, immigrants and refugees, or seniors. Examples of these types of benefits are Maternity and parental benefits, Disability tax credit, Old Age Security, and Resettlement Assistance Program.
Emergency Benefits are usually to help people living on low-income that are experiencing a temporary financial hardship such as an leaving an abusive relationship or encountering homelessness. An example of this type of benefit is the Canadian Emergency Wage Subsidy program that the federal government created to help workers that were impacted by layoffs due to COVID lockdowns.
EXPLORING AND APPLYING FOR BENEFITS
There are too many types of benefits for them all to be listed here. The large number of options can make it hard to know which benefits you qualify for. Some of them have very easy application processes and some of them are complicated. Fortunately, there are online tools and in-person services provided by non-profit organizations that can help you explore and apply for benefits you may be eligible for.
To explore benefits, you can use online tools like Prosper Canada’s Benefits Wayfinder tool or the Government of Canada Benefits Finder tool. In Winnipeg, the Community Financial Counselling Services Income Tax Services and SEED Winnipeg’s Access To Benefits program have programs available to help people explore benefits and can help people apply for them.
Once you have found a benefit you are eligible for, you will need to fill out an application to confirm eligibility and receive the money. Sometimes this application is part of your income tax return, such as the GST credit, and sometimes you will need to apply separately, like the Manitoba Primary Caregiver Tax Credit. If you need help with the application process, reach out to SEED’s Access to Benefits program for help.
To continue to receive benefits that you are currently receiving, you will need to file your income taxes in each future year, otherwise you risk losing that benefit and having to go through the application process again from the beginning. If the benefit you applied for had a stand-alone application, you will likely need to re-apply each year for it as well. You can ask the benefit provider what to expect so that you can plan for it.
TOOLS & RESOURCES
Exploring Benefits:
Government of Canada benefits finder tool http://www.canadabenefits.gc.ca/
Prosper Canada Benefits Wayfinder tool https://benefitswayfinder.org/
Applying for Benefits:
SEED Winnipeg Access to Benefits program (AtoB) – https://seedwinnipeg.ca/programs/detail/access-to-benefits
Income tax preparation:
Community Volunteer Tax Preparation program near you, visit
www.canada.ca/en/revenue-agency/services/tax/
CSFC – Free Income tax preparation for people living on low income https://cfcstaxes.com/
Other Resources:
Information on the Canadian tax system www.taxtips.ca
This is an online, self-paced course on how to do your taxes, prepared by the Canada Revenue Agency
https://www.canada.ca/en/revenue-agency/services/tax/individuals/educational-programs.html
Jeff Patteson
Recognition Counts Loan Coordinator
SEED Winnipeg Inc.
For more information, visit seedwinnipeg.ca
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