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.
November 15, 2000
XXXXXXXXXX
Dear XXXXXXXXXX:
The Honourable Martin Cauchon, Minister of National Revenue, has asked me to reply to your letter received on September 29, 2000, concerning your entitlement to the Guaranteed Income Supplement (GIS).
An individual's entitlement to the GIS is generally based on the individual's income of the preceding calendar year. The optional income provisions of the Old Age Security (OAS) legislation are intended to buffer low-income pensioners from the effects of decreased revenues due to ceasing employment, ceasing a business or from a reduction in pension income. In these circumstances, if it is to the applicant's advantage, the income-tested benefits may be calculated based on estimated income for the current year instead of actual income of the preceding calendar year. The Old Age Security Act states that, for GIS purposes, the income of a person is computed in accordance with the Income Tax Act.
I understand you received benefits under the Plant Worker's Adjustment Program (PWAP). The Canada Customs and Revenue Agency has consistently stated that income assistance payments made to individuals previously employed with the fishing industry are taxable as other income, not pension income under the Income Tax Act. For purposes of the optional income provisions, the OAS regulations provide a separate definition of "pension income". However, the definition of "pension income" under the QAS regulations does not include benefits which are taxable as "other income" under the Income Tax Act. Therefore, when the benefits under the program cease or are reduced, the GIS optional income provision is not triggered and the assistance received under the program must be considered in establishing entitlement to the GIS. The result is that the GIS payments are reduced, generally until the next renewal period.
Human Resources Development Canada administers the GIS program according to the current legislation. I must confirm that the Income Tax Act and the Old Age Security Act have been applied correctly in your case, and legislative changes would be required before relief could be provided.
I appreciate the Opportunity to address your concerns.
Yours sincerely,
Bill McCloskey Assistant Commissioner Policy and Legislation Branch