Disability and Inheritance

Hi, I am receiving CPP disability and Sunlife disability payments each month. I am expecting to receive an inheritance of about $20.000 through a life insurance policy that was left to me. I do not believe that this is considered income so do I have to report it to CPP and/or Sunlife???


It is not income from work, which is what affects CPP and LTD. No reporting is required.

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For LTD, check your policy or call them. The policy should list which types of income you have to report to the insurance company. Mine says I have to report inheritances and things like lottery winnings, but I’m with a different company.

Most life insurance proceeds are not taxable, and the CPP website says you have to report taxable income from working. It doesn’t mention any other kind of income on their website. https://www.canada.ca/en/employment-social-development/programs/pension-plan-disability-benefits/reports/toolkit.html#h5.1

If you find that you have to report the life insurance proceeds to the insurance company, it’s a good idea to talk to a lawyer first.

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Thank you Caro and sekhmet for your replies. I am mostly confident that it does not have to be reported especially to the CPP. I’m a little unsure about Sunlife though especially after you said sekhmet that your LTD company requires you to report any inheritance. I looked on the Sunlife website last night to see if I could find out for sure but I could not find anything. I even searched online about Sunlife and inheritance but nothing! I guess I will just have to call Sunlife to be absolutely sure. I don’t want to not report it and then later find out I was suppose to report it and look like I was trying to hide it or something. I was also hoping that one of the lawyers here would have commented but that has not happened. Thanks again to both of you for your help. :pray:

The place to look is in your benefits booklet from work (assuming it’s a workplace LTD policy). It would also be reasonable to just notify your case manager, since it would enhance your credibility and not change your actual rights under your policy.

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Yes I will look to see if I have that booklet around. I don’t remember receiving it but I might have. It was workplace ltd. If I cannot find it I will go ahead and contact Sunlife. I just wanted to be prepared and more knowledgeable about it before contacting them. Thanks for the info Caro. Much appreciated.