Note: Eligibility for Canada Student Grants is based on previous year’s income only, as per federal requirements. There is no review of Canada Student Grant eligibility based on estimated current year income.
A student may request that his/her financial need be assessed using parental or spousal estimated current year income rather than actual previous year income when the estimated income would be a better indicator of the family’s current financial situation because of non-recurring and major changes to the parental or spousal income.
Examples of non-recurring major changes to income can include, but are not limited to:
Parental income: The FAA must conduct this review in conjunction with the review for parental exceptional expenses (full- or part-time educational costs), where the FAA must deduct the direct educational costs that are being covered by Second Career/Ontario Skills Development funding as exceptional expenses. (See Section E.6)
Spousal income: The FAA must conduct this review in conjunction with the review for spousal educational expenses, where the FAA must deduct the spouse’s direct educational costs that are being covered by Second Career/Ontario Skills Development funding, as exceptional expenses either during pre-study or study period depending on when the expense was paid. (See Section E.6).
Note: A request to use estimated income cannot be considered if the circumstance is recurring or does not constitute a major change in parental/spousal income (i.e., overtime wages).
Where a review based on estimated income is approved, the reassessment based on lower estimated income may also alter a student’s eligibility for Ontario Access Grants. No special steps are required of the FAA for this to occur. The Ministry will estimate the net income and determine Ontario Access Grant eligibility. However, as per federal requirements, eligibility for the Canada Student Grants is based on actual previous year income only. Therefore, Canada Student Grant eligibility will continue to be based on actual previous year income even if an overall reassessment is based on estimated current year income.
Verification of Estimated Income
The ministry will verify the estimated current year income with Canada Revenue Agency (CRA) when the income tax information becomes available. The student’s current OSAP application will be reassessed at that time. The student will be responsible for the repayment of any loan or grant overaward that may be generated from this reassessment.
The following types of income should not be included in estimated parental or spousal income:
a) Income from federal support programs
Payments received through the following federal programs:
b) Income from provincial support programs
Payments received through the following provincial programs:
c) Pain and suffering awards
Pain and suffering awards, including the general damages component of personal injury awards and WSIB Non-economic loss (NEL) awards, in amounts less than $100,000 are exempt from income. Any amount over $100,000 is considered income in the period it was received. If payments are made for different incidents, the payments related to each incident are exempt up to $100,000.
d) Locked-in retirement savings
Married students are not to report funds that are invested in a locked-in retirement savings account (i.e., Locked-in Retirement Account (LIRA), a Life Income Fund (LIF), and/or a Locked-in Retirement Income Fund (LRIF)) as an asset on the OSAP application. In addition, students and their parents/spouse, if any, who gain special access to money invested in any of these accounts prior to the usual withdrawal age (e.g. age 55) are not to report the amount withdrawn on the student’s OSAP application as income. However, once a student/parent/spouse withdraws any money invested in these accounts as per the fund’s usual withdrawal age, he or she must report the amount withdrawn as income on the student’s OSAP application.
Note: A locked-in retirement savings account is an account into which an individual's pension benefit is transferred when the individual terminates their membership in a registered pension plan. The money payable to the individual from this locked-in account can be used only to provide retirement income and is therefore locked-in until the individual reaches the age of 55. In Ontario, there are three types of locked-in accounts: Locked-in Retirement Accounts (LIRA), Life Income Funds (LIF), and Locked-in Retirement Income Funds (LRIF).
e) Treatment of split pension income
If the parent(s) or spouse of a student is splitting pension income, the amount to be reported on the LEI form should be an “estimate” of their total income, less any pension income that they believe they will be splitting with the other parent/student. The declared information will be verified upon the completion of the income verification process for the current year.