The following liquid assets are excluded for benefit calculation purposes:
A. To a TOTAL (cumulative) VALUE of $60,000 for ALL the following amounts:
- The value of PENSION CREDITS that have accumulated in a retirement plan other than the Quebec Pension Plan or the Canada Pension Plan, as well as the amounts that have accrued with interest as a result of the recipient's participation in another retirement savings plan which, under the retirement savings instrument or plan in question or by law, CAN BE RETURNED to the recipient before the age of retirement (R.113(1)).
This also covers amounts deposited in a retirement plan or a registered retirement savings plan WHILE an adult or a family ARE RECIPIENTS. These exclusions are also applicable to retirement plans obtained in a DIVISION OF PROPERTY upon separation or divorce or dissolution of a civil union.
- A sum received in the form of an amount or a PENSION CREDIT referred to in paragraph 1.1, where it is used within thirty days of its receipt as a contribution to another RETIREMENT PLAN or retirement savings instrument (R.113(2)).
When a person withdraws the principal amount of a retirement plan or other retirement savings instrument, it becomes a liquid asset. This liquid asset is excluded from his or her resources to a maximum of $60,000 where the recipient uses this amount within 30 days of its receipt to participate in another pension plan or retirement savings instrument.
- The AMOUNT of a grant or loan to be used to BUILD OR REPAIR A RESIDENCE, where it is used within 6 months of its receipt for the purposes for which it was obtained (R.113(3)).
- The AMOUNT of a grant or loan to be used to start A BUSINESS or to CREATE one's own EMPLOYMENT, where it is used within 6 months of its receipt for the purposes for which it was obtained.
- The total value of the amounts in a registered education savings plan.
Any amount over $60,000 is considered to be a liquid asset to which the basic exclusion applies.
The exclusions mentioned in points 2 through 4 apply only where the amounts are deposited promptly in a separate account in a chartered bank or another institution legally authorized to receive deposits.
Any amount used contrary to the purposes for which it was obtained or not used within the specified time is considered to be a liquid asset for the entire month of the contravention.
UNSANCTIONED USE OF SUMS
The exclusions mentioned in points 2 through 4 apply only when the conditions for use and the prescribed time period are respected.
Sums used for unsanctioned ends are considered liquid assets for the entire month in which they were used contrary to these provisions (see section 3.3.10).
B. AMOUNT FROM A SUCCESSION
An amount from a succession is excluded for benefit calculation purposes, to a maximum of the DEBTS AND ENCUMBRANCES of the succession by which the recipient is bound; the recipient does not have access to the amount with which he or she must pay the debts and encumbrances of the succession.
C. PROCEEDS OF A LIFE INSURANCE POLICY
The proceeds of a life insurance policy are considered to be liquid assets except for the amounts incurred for the FUNERAL EXPENSES of the deceased:
- if the recipient has contracted with a funeral service provider for care of the deceased,
AND
- if the funeral expenses incurred are paid by the recipient within 30 days of the receipt of the proceeds of the life insurance policy.
If the proceeds of the insurance are not used to pay for funeral expenses or are used after the 30-day deadline, the usual rules for calculating liquid assets apply:
- calculation of liquid assets on the last day of the month in which the proceeds of the life insurance policy were received,
AND
- the basic exemption is applied
D. REPAYMENT OF A LOAN OR ACCOUNT PAYABLE IN THE COURSE OF OPERATION OF A FARM OR SELF-EMPLOYMENT
Amounts held back to pay a loan or reimburse an account payable in the course of self-employment or, in the case of a farm producer within the meaning of the Farm Producers Act, to operate a farm, are excluded from liquid assets if they are USED WITHIN 6 MONTHS of the time they are held back to meet these obligations.
When the sums or part thereof are not used within the 6-month time limit, they are processed according to the usual rules on the last day of the sixth month.
E. REGISTERED EDUCATION SAVINGS PLAN
As the regulation specifies that it is a registered plan, the amount must be invested in a plan that is recognized from a fiscal point of view to benefit from the exclusion. The total value can be the result of small amounts accumulated over time or through a lump sum from a donation, a gift, lottery winnings, etc. However, the client must invest the sum before the last day of the month if he does not want the sum to be considered regular liquid assets.