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Monday, July 6, 2020

How does receiving an inheritance affect my EI benefits?

On this blog, we've talked many times about how receiving an inheritance can cause a disruption in eligibility for provincial programs such as disability benefits. But we really have not talked about what would happen to Employment Insurance (EI) benefits if you receive an inheritance.

The EI program requires that individuals who receive the benefits fill out regular reports that divulge all monies received. The directions are to report "all your income". This raises the question of whether money received by way of inheritance is "income" for the purposes of the program. From the inquiries I've heard, information about the impact of inheritance is scarce, and the usual advice I've seen is something along the dubious lines of "keep it quiet and maybe nobody will notice".

There is no need to be so secretive if you receive an inheritance while on EI. Receiving an inheritance, regardless of the amount, will have no impact whatsoever on your EI eligibility. This is because the EI program is concerned only with amounts that you have earned, not amounts that you have received as a gift. Even lottery winners can be eligible for EI. You do not have to report your inheritance to EI because it is a gift. For more information about this, see the EI website here.

As a side note, if you are the executor of an estate and you receive an executor's fee, the fee must be reported to EI as earned income and may affect your eligibility. This is because you did work to earn that fee.

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