2024 Fall Economic Statement 
Reducing Everyday Costs and Raising Wages

Personal Income Tax Measures

Exempting the Canada Disability Benefit from Tax

The Canada Disability Benefit is a new program under which the Government of Canada intends to provide up to $2,400 annually to support low-income, working-age Canadians, who are eligible for the Disability Tax Credit, beginning in July 2025.

Under current rules, payments received under the Canada Disability Benefit would be included in income for tax purposes. While an offsetting deduction would be provided to ensure these payments are effectively non-taxable, amounts received could affect income-tested benefits delivered through the federal tax system, such as the Canada Child Benefit. Other federal programs and provincial/territorial benefits, such as child benefits, which may rely on income as computed under the federal Income Tax Act to calculate entitlements, would also be affected.

The 2024 Fall Economic Statement proposes to exempt amounts received under the Canada Disability Benefit from income under the Income Tax Act. This would help ensure that income-tested benefits and programs are not reduced as a result of payments under the Canada Disability Benefit.

This measure would apply to the 2025 and subsequent taxation years.