9.20 — Transition child benefit

March 2017

Summary of policy

The Transition Child Benefit (TCB) is a mandatory benefit that is provided to ODSP recipients who have primary or shared physical custody of a dependent child (or children) and who are not receiving the Ontario Child Benefit (OCB)/National Child Benefit Supplement (NCBS) or who are receiving less than the maximum OCB. The amount of the TCB takes into account any amount of the OCB/NCBS received by the recipient and/or their spouse who is in the benefit unit. Effective July 2015, the maximum amount of TCB that a recipient can receive is $207 per child per month.

As with the NCBS, the OCB is considered a financial resource that a recipient and/or their spouse are obligated to pursue. Recipients and/or their spouse must make reasonable efforts to obtain the OCB and NCBS as a condition of eligibility.

In order to avoid duplication of social assistance, repayment of the TCB is required where a retroactive payment for the OCB/NCBS overlaps the same period that a TCB was issued. The amount of time allowed to collect the TCB repayment is a maximum of three months or until the TCB is repaid in full, whichever comes first.

Note: For the purposes of calculating the TCB amount, Canada Revenue Agency will continue to provide the ministry with notional NCBS amounts during a transitional period until July 2017.

Legislative authority

Sections 11, 36.2 (1), 36.2 (2) and 45.3 of the ODSP Regulation

Summary of directive

This directive outlines:

• the eligibility criteria for the TCB
• calculation of the TCB
• procedure for repayment of the TCB where there has been a duplicate payment due to an overlap of a retroactive OCB/NCBS payment and the TCB

Intent of policy

For recipients who do not receive the OCB/NCBS, or receive less than the maximum amount of the OCB, a TCB of up to $207 per child per month may be provided to assist these families.

Where a retroactive OCB/NCBS payment is issued for the same period that the TCB was paid, the TCB is repaid.

Application of policy

Eligibility for the TCB

A recipient or spouse who is receiving less than the maximum OCB/NCBS may be eligible for the TCB. The TCB amount takes into account any amount of the OCB/NCBS received by the recipient and/or his/her spouse who is in the benefit unit. In such cases, a partial TCB may be paid.

A recipient or spouse who is not in receipt of the OCB/NCBS for a dependent child may also be eligible for the TCB. Examples of persons who may be eligible for the TCB include those who:

• did not file income taxes for the previous taxation period
• are newcomers to Canada such as refugee claimants
• have recently moved to Ontario
• have a newborn child
• have experienced a substantial income change from the previous taxation year
• are facing administrative delays for receipt of OCB

A recipient or spouse receiving the maximum OCB and NCBS monthly payments on behalf of a dependent child will not be eligible for the TCB.

Other individuals not eligible to receive the TCB include:

• persons not on social assistance in their own right and receiving only Assistance for Children with Severe Disabilities (ACSD) financial assistance on behalf of a child
• persons in receipt of the Extended Health Benefit (EHB); the Transition Health Benefit (THB); or the Extended Employment Health Benefit (EEHB) under Ontario Works
• residents of interval and transition homes whose income support is not calculated under the basic needs and shelter rates tables since they are not maintaining a community residence
• residents of emergency hostels

Shared custody situations

Where CRA has determined that both parents will share eligibility for the CCB, the OCB will also be shared. Effective July 2011, the TCB will be provided on a monthly and prorated basis to eligible parents.

The recipient must provide written verification from the Canada Revenue Agency (CRA) that he/she is eligible to receive the CCB as a shared custody parent. The recipient will not be eligible for the TCB if the CRA has determined that shared custody arrangements are not in place.

If a recipient in a shared custody situation is not eligible for the OCB, because of his/her immigration status, he/she will be eligible for 50% of the TCB on a monthly basis.

Calculation of the TCB

Again, for the purposes of calculating the TCB amount, Canada Revenue Agency will continue to provide the ministry with notional NCBS amounts during a transitional period until July 2017.

For cases where a recipient is not receiving any amount of OCB or NCBS (i.e. $0 OCB/ $0 NCBS) for each eligible dependent child, the recipient will receive $207 TCB per dependent child, per month.

Where a recipient receives less than the maximum OCB for a dependent child, the Transition Child Benefit will be calculated as follows:

A = ($207 × B) - (C + D)
Where:
A = the amount of the TCB
B = the number of dependent children
C = the total monthly OCB payment
D = the total monthly NCBS payment decreased by the 2004 - 2007 federal NCBS increases

Example

ODSP Family with three children receiving $228.33 OCB and $380.36 NCBS

A = ($207 × B) - (C + D)
Where:
A = the amount of the TCB
B = three children
C = Monthly OCB payment for three children = $228.33
D = Monthly NCBS payment for three children = $253.21 (this amount has been decreased by the 2004 – 2007 federal NCBS increases)

A. = ($207 × 3) - (228.33 + 253.21)
= ($621) - (481.54)

A. = $139.46

Amount of monthly Transition Child Benefit for family = $139.46

Note: In a shared custody situation, the TCB calculation will be the same as in the above example. However, only 50% of the annual TCB eligible amount will be provided.

Ongoing TCB Eligibility

The TCB is provided for up to four months to allow efforts to be made to obtain the OCB/NCBS. Failure to make reasonable efforts to obtain OCB/NCBS may result in refusal of the TCB. The ODSP Director has the discretion to extend the TCB beyond four months if the Director is satisfied that the recipient or spouse has made reasonable efforts to obtain the OCB/NCBS.

Reasonable efforts include, but are not limited to:

• filing an income tax return for both the recipient (and spouse, if applicable)
• the applicant informing the CRA about changes to his or her situation that could affect his or her eligibility for the OCB and NCBS (e.g. reporting an address change)
• notifying the ODSP local office that the CRA has reassessed either the recipient’s or spouse’s return, and the calculation of their benefit could change

For those recipients who are not eligible for OCB (such as refugees) or those recipients who are eligible for less than the maximum OCB, the four month limitation on TCB is not applied. Refugee claimants will be eligible for the maximum TCB until they become eligible for the CCB, at which time the TCB amount will be re-assessed based on the OCB/NCBS amounts. Recipients who are receiving a partial OCB are eligible to receive a partial TCB until their OCB and NCBS eligibility is reassessed after the next taxation period.

Canada Revenue Agency (CRA) contingency payments

Every July, CRA re-assesses a family’s eligibility for /NCBS/OCB based on the current year’s tax assessment. In cases where families have filed a tax return, but CRA has not yet assessed it, an OCB/NCBS/ contingency payment will be issued. This payment is based on the previous year’s tax assessment of the OCB/NCBS/.

Families who do not file their income taxes for the current tax year will not receive any OCB/NCBS/ contingency payments from CRA. These families may be eligible for the TCB for up to four months to allow them sufficient time to file their taxes.

Once the current year’s income tax return is filed and assessed, CRA will recalculate the OCB retroactively to July. If it is determined that the family received more OCB than they were entitled to receive, a debt will be created on the family’s CRA account.

In months where the maximum amount of the OCB is issued as a contingency payment, a TCB will not be issued.

In cases where an OCB contingency payment is subsequently created as a debt by CRA, the TCB will begin to be paid in the month the debt is created for up to four months.

• For example, if CRA issues a maximum OCB/NCBS contingency payment to the recipient for July, a debt is created on the family’s CRA account in August for the July OCB/NCBS payment. A TCB payment will not be issued in July; however, the TCB will be provided in August for up to four months to allow time for filing of taxes.

Client is assessed by CRA in September:

• if eligible for full OCB, TCB is recovered in accordance with policy (see section below)
• if eligible for partial OCB, recovery of TCB in accordance with policy (see section below)

In cases where a recipient receives less than the maximum OCB/NCBS as a contingency payment, a TCB will be issued for this month based on the TCB formula.

• For example, if a recipient is eligible for less than the maximum OCB/NCBS as a contingency payment for July, and a debt is created on the family’s CRA account in August for this payment, a partial TCB payment is provided in July based on the TCB formula. No additional TCB is to be provided for July. However, the maximum amount of TCB will be issued in August for up to four months.

Please note: Once the recipient has filed his/her income taxes and the appropriate OCB/NCBS entitlement is assessed, arrears for TCB may be issued based on the TCB formula. Alternatively, a recovery may be made from a reduction in budgetary requirements based on a retroactive OCB/NCBS lump sum payment.

Children placed temporarily with a children’s aid society, Indigenous Child Well-Being Society or alternate caregiver

Where a child is in need of protection and is placed in the temporary care of a Children’s Aid Society, or Indigenous Child Well-Being Society (“society”), or placed by a society with an alternate caregiver, the child should remain as a dependent child in the applicant or participant’s benefit unit. In these situations, the CCB/OCB may no longer be issued to the parent if the society applies and becomes entitled to the federal Children’s Special Allowance (CSA) administered by CRA. When the child is returned to the parental home, the CSA is no longer issued to the society and the caregiver must reapply for the CCB/OCB.

A maximum TCB monthly amount of $207 for each child is to be issued for the period in which a parent is not in receipt of the CCB/OCB if:

• the dependent child is placed in the temporary care of a society or alternate caregiver
• the parent is no longer receiving the CCB/OCB

To support family reunification, the child is to remain in the benefit unit and the full sole- support parent supplement and shelter allowance are to be provided (see Directive 2.2 Who is eligible: dependent children for more information).

Payments made under the Ontario Child Benefit Equivalent (OCBE) Act, 2009 may be provided to a society in respect of a child or youth in the permanent care of a society. (See Directive 2.2 Who is eligible: dependent children). OCBE payments are considered exempt as income and assets when determining eligibility and budgetary requirements of a benefit unit.

Recovery of TCB

The TCB will be recovered where a retroactive OCB/NCBS payment covers the same months that a TCB was paid.

The repayment amount will be the lesser of the total TCB paid and the OCB/NCBS retroactive payment for the same period.

Effective August 1, 2015, the amount of time allowed to collect a Transition Child Benefit repayment is extended from one month, to a maximum of three months or until the TCB repayment owed is paid in full, whichever comes first.

If the amount of TCB recovered is greater than the recipient’s budgetary requirements, the budgetary requirements will be reduced to $2.50 and the recipient will remain eligible for ODSP benefits, such as drug benefits and Mandatory Special Necessities (MSN), etc.

Note: The TCB recovery reduces the budgetary requirements before any other type of deductions are made (e.g., earnings deductions).

TCB recovery calculation:

TCB recovery amount = the lesser of B and (C + (D - (E × F)))
Where:
B = Total TCB paid in the overlap period
C = Total OCB paid for the same period
D = Total NCBS paid for the same period
E = The sum of NCBS exemption amounts depending on number of children
F = The number of months in the period

Please note that no overpayments will be created as a result of TCB recovery process. Recovery will occur only up to the maximum amount as defined above and will begin in the ODSP benefit month that the retroactive OCB/NCBS payment is received up to a maximum of three months or until the TCB repayment owed is paid in full, whichever comes first.

Example

An ODSP family with two children has been receiving the maximum $207 per child TCB for September, October and November 2015.

The family receives a retroactive OCB/NCBS payment totalling $1431.54 in December 2015 for September to November 2015.

Ongoing OCB/NCBS payments commence in December 2015.

Amount of TCB recovered = the lesser of B and (C + (D - (E × F)))

Where:
B = ($207 × two children × three months) = $1242
C = ($156.66 × three months) = $469.98
D = ($320.52 × three months) = $961.56
E = ($43.75 first child + $41.99 second child) = $85.74
F = 3

Recovery amount = the lesser of $1242 and ($469.98 + ($961.56 - ($85.74 × 3)))

Recovery amount = the lesser of ($1242 TCB) and ($1174.32 OCB/NCBS)

The family’s December 2015 budgetary requirements will be reduced by the TCB recovery amount of $1174.32.

Related directives

2.2 — Who is eligible: dependent children
2.5 — Tourists, immigrants, refugees and deportees
5.1 — Treatment of income