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Kendall Worth: Self−employment clawbacks reduced for income assistance recipients, and that’s great news

Kendall and Judy Deal at an anti-poverty rally a while ago. Photo Robert Devet

KJIPUKTUK (Halifax) –  Last week we learned some good news for anyone on Income assistance who either already is self-employed or has interest in wanting to become self-employed.

They now get to keep more of their earnings from self-employment.

Do you readers of the Nova Scotia Advocate ever wonder if income assistance recipients ever dream about starting their business?

Well, it actually happens. Many income assistance recipients in Nova Scotia are persons with disabilities, and people with disabilities of all types start and then become successful at running their own business.

I myself once was involved in self-employment. Even though my self-employment venture ended up not being a success, I still found the whole project a valuable learning experience for me.

As I said, people now get to keep more of their earnings from self-employment.  

Before May 1st, 2019, say if you were on Income Assistance and earned a bit from self-employment that income would be clawed back from your income assistance check.  

Now Self Employment income is going to get treated the same as employment income.   

The following is a copied a pasted version of a response to the Nova Scotia Advocate’s questions it submitted to the department of Community Services.

“On October 1, 2018, the department introduced an enhanced wage exemption to allow clients to keep more of the money they earn before seeing a reduction in their income assistance. At that time, the exemption only applied to wages for regular and supported employment. Effective May 1, 2019, the wage exemption has been renamed the earned income exemption, and now applies to other sources of earned income from employment, including net business income, tips, gratuities and commissions.

This change results in the equal treatment of income from employment and seeks to improve a client’s ability to meet their basic needs by allowing them to earn more money from working before seeing a reduction in their income assistance. The earned income exemption structure is as follows:

Earned Income Exemption (Regular Employment)
Amount of Earned IncomeExemption Rate
On your first $250 100%
Your next $250 ($250.01 – $500.00) 75%
Your next $250 ($500.01 – $750.00) 50%
Over $750 25%
Earned Income Exemption (Supported Employment)
Amount of Earned IncomeExemption Rate
On your first $350100%
Your next $150 ($350.01 – $500.00)75%
Your next $250 ($500.01 – $750.00)50%
Over $750 25%

Note that in the second table, what the department calls “supported employment” applies to people whose physical, mental or cognitive abilities prevent them from being financially self-sufficient.

Anyways, this is great news because this opens up the door for income assistance recipients to explore the world of entrepreneurship.

As I mentioned, I once ran a little business myself, and I got to learn a lot about business. As an entrepreneur you always learn a lot. The self-employed world is a world full of adventure.   

I would like to use this moment to look back at some stories I have in the past written for the Halifax Media Co-op.

One of the great work experiences is writing business proposals. I wrote this article using those skills I gained from writing a plan for my business: A Proposal for a Drop-In Centre, from the Eyes of a Person Living in Poverty.

This article here, How to deal with learning disabilities, shows a complete example as how gaining experience from self employment can help someone with a learning disability better themselves by taking risk in their lives. Also, this story shows evidence that a person with a disability owning their own business can be done.

There is this one: My life as a poverty activist and writer. This shows that even though my business ended up not being successful, I did achieve a lot from the learning experience from trying self-employment.

I am really proud of this story I wrote in 2015: Creative ways for businesses to pitch in and help reduce poverty. I look at this story and realize that if the business community wanted to be creative that community can actually help reduce poverty.  

So I will end my current story by saying I am really looking forward to how self-employment is in the future going to be an option for income assistance recipients.