Payments

Your income from the previous tax year:

Your benefit amount depends primarily on your income from the previous tax year. The Government of Canada calculates your benefit amount based on your adjusted income.

Adjusted income includes:

• All sources of income that you and your cohabiting spouse or common-law partner (if applicable) report on your Income Tax and Benefit Return to the Canada Revenue Agency (CRA) that are not classified as benefits,

• Social assistance payments*,

• Workers’ compensation*,

• The Guaranteed Income Supplement*, and

• Your working income, although it may be partially or fully exempt.

Social assistance payments, workers’ compensation, and the Guaranteed Income Supplement are considered adjusted income, even though they are not taxable.

Adjusted income does not include:

• Payments from the Registered Disability Savings Plan (RDSP),

• Universal Child Care Benefit (UCCB) payments,

• Some payments that are not reportable to the CRA, including:

  • Payments of child benefits and tax credits,

  • Compensation payments for personal injury/pain and suffering,

  • Some categories of veterans’ benefits, and

• CDB payments.

To simplify payment explanations, we refer to adjusted income as income from now on.

Family status 

Your family status also determines your benefit amount:

• Single means the person receiving the benefit has no cohabitating spouse or common-law partner living with them.

• Couple means the person receiving the benefit has a cohabitating spouse or common-law partner living with them. The couple's combined income is used to calculate their benefit amount.

The income threshold, working income exemption, and reduction rates used to calculate your benefit amount vary depending on your family status. Couples have higher income thresholds because they share living expenses and costs.

Income threshold

The income threshold is the maximum amount of income you can earn before your benefit amount is reduced. The income threshold is:

• $23,000 for a single person

• $32,500 combined for a couple (this income threshold applies regardless of whether one or both people qualify for the CDB)

If your income is below the income threshold (including the working income exemption, if applicable), you will receive the maximum benefit amount of $2,400 a year or $200 a month.

However, if your income exceeds the income threshold (including the working income exemption, if applicable), your benefit amount will be reduced. Any income above the income threshold will be reduced by a specific percentage, known as the reduction rate. Your benefit amount may be reduced to the point where you no longer receive the CDB. This is known as phase-out income. 

Refer to the reduction rates to determine how much your benefit amount will be reduced if you earn above the income threshold. Also, see below for phase-out income.

Working income exemption

The working income exemption allows you to exclude a portion of your working income when calculating your benefit amount. Working income includes income from employment, self-employment, or taxable scholarships. The working income exemption is:

Up to $10,000 for a single person

• You can earn up to $10,000 per year in working income, which will be excluded from the calculation of your benefit amount. This means if your working income is at least $10,000, your income threshold increases from $23,000 to $33,000.

Up to $14,000 combined for a couple

• You can earn up to a combined $14,000 per year in working income, which will be excluded from the calculation of your benefit amount. This means if your combined working income is at least $14,000, your income threshold increases from $32,500 to $46,500.

Reduction rates

Any income that exceeds the income threshold will reduce your benefit amount. For every dollar of income above the income threshold, your benefit amount will be reduced based on the following rates:

20% or 20 cents for every $1 above the income threshold, for a single person

• Without the working income exemption: Your benefit amount will be reduced if your income exceeds $23,000. For every dollar you earn above this amount, your benefit amount will be reduced by 20 cents.

• With the maximum working income exemption: Your benefit amount will be reduced if your income exceeds $33,000 (this includes the maximum working income exemption of $10,000). For every dollar you earn above this amount, your benefit amount will be reduced by 20 cents.

20% or 20 cents for every $1 above the income threshold, for a couple if only one person is eligible for the CDB

• Without the working income exemption: Your benefit amount will be reduced if your combined income exceeds $32,500. For every dollar you earn above this amount, your benefit amount will be reduced by 20 cents.

• With the maximum working income exemption: Your benefit amount will be reduced if your combined income exceeds $46,500 (this includes the maximum working income exemption of $14,000). For every dollar you earn above this amount, your benefit amount will be reduced by 20 cents.

10% or 10 cents for every $1 above the income threshold, for a couple where both people are eligible for the CDB

• Without the working income exemption: Your benefit amount will be reduced if your combined income exceeds $32,500. For every dollar you earn above this amount, your benefit amount will be reduced by 10 cents.

• With the maximum working income exemption: Your benefit amount will be reduced if your combined income exceeds $46,500 (this includes the maximum working income exemption of $14,000). For every dollar you earn above this amount, your benefit amount will be reduced by 10 cents.

Phase-out income

You will not receive the CDB if your income exceeds a specific limit, known as the phase-out income. The phase-out income is:

$35,000 for a single person

• Without the working income exemption: You will not receive the CDB if your income is $35,000 or more.

• With the maximum working income exemption: You will not receive the CDB if your income is $45,000 or more (this includes the maximum working income exemption of $10,000).

$44,500 for a couple if only one person is eligible for the CDB

• Without the working income exemption: You will not receive the CDB if your combined income is $44,500 or more.

• With the maximum working income exemption: You will not receive the CDB if your combined income is $58,500 or more (this includes the maximum working income exemption of $14,000).

$56,500 for a couple where both people are eligible for the CDB

• Without the working income exemption: You will not receive the CDB if your combined income is $56,500 or more.

• With the maximum working income exemption: You will not receive the CDB if your combined income is $70,500 or more (this includes the maximum working income exemption of $14,000).