Disability income can qualify you for a mortgage in Canada. What lenders want to know is how long it will continue, whether it’s taxable, and whether it’s enough on its own. This page covers how each type is counted, how a “gross-up” works for non-taxable benefits, the documents lenders ask for, and the usual ways to close a gap. It is part of our guides to lenders, brokers and special situations. If you already own a home and are worried about keeping it after a disability, see your mortgage if you become disabled.
How lenders look at each type
| Income | Taxable? | What lenders focus on |
|---|---|---|
| CPP Disability (CPP-D) | Yes | Proof of ongoing entitlement; it continues until you recover or reach 65, when it converts to a CPP retirement pension |
| Long-term disability insurance (LTD) | Depends on who paid the premiums (below) | Whether the benefit continues: the policy’s review dates, end date and conditions |
| Workers compensation (WSIB, WorkSafeBC, WCB) | No | An entitlement letter showing the benefit is ongoing |
| Provincial disability programs (ODSP, AISH, PWD) | No | The entitlement letter; the amounts are low on their own |
| Veterans Affairs Canada disability benefits | Generally no | Award or pension documents |
| RDSP withdrawals | Partly | Rarely counted as income, since they aren’t a guaranteed stream |
Lender policies on provincial programs and on income with a review date vary more than on CPP-D or a long-standing LTD claim, which is where a broker who knows each lender’s policy helps (see what a mortgage broker does).
Gross-up for non-taxable income
A dollar of non-taxable income buys more than a dollar of taxable salary, so many lenders “gross up” non-taxable benefits, counting them as if they were higher pre-tax income. The amount of the gross-up (often expressed as a percentage, commonly up to 25%) and which benefits qualify are each lender’s own policy, and some lenders don’t gross up at all. Taxable benefits such as CPP-D and employer-paid LTD are already gross income and aren’t grossed up.
A non-taxable benefit of $2,000 a month, grossed up by 25%, counts as $2,500 a month of qualifying income.Is your LTD benefit taxable?
| Who paid the premiums | Benefit taxable? | Gross-up possible? |
|---|---|---|
| Your employer | Yes | No |
| You, with after-tax money | No | Often, depending on the lender |
| Both | Partly | Depends on the lender |
Amounts at a glance
| Program | Maximum |
|---|---|
| CPP Disability | $1,741.20 a month for a new beneficiary in January 2026 |
| ODSP (Ontario), single person | $1,436 a month |
| AISH (Alberta), single person | $1,940 a month |
| PWD (British Columbia), single person | $1,483.50 a month (from December 1, 2025) |
On their own, provincial program amounts support only a small mortgage, so most buyers on those programs qualify with a co-borrower, other income or a large down payment. Private LTD typically replaces a share of pre-disability earnings set by the policy.
Ways to close a gap
Combine income
A partner’s employment income, part-time work, a pension or rental income can all sit alongside disability income on one application. Each is documented the usual way (see the employment letter and, for a co-borrower or guarantor, co-signing a mortgage).
A larger down payment
On a $250,000 home, at 5.25% over 25 years:
| Down payment | Mortgage | Monthly payment |
|---|---|---|
| $50,000 (20%) | $200,000 | about $1,192 |
| $100,000 (40%) | $150,000 | about $894 |
| $150,000 (60%) | $100,000 | about $596 |
A smaller mortgage needs less qualifying income at the lender’s debt ratio limits: For an insured mortgage, CMHC caps your housing costs at 39% of gross income (GDS) and your housing costs plus other debt payments at 44% (TDS); lenders set their own limits for uninsured mortgages. The ratios are applied at the stress-test rate, not your contract rate (see GDS and TDS ratios).
A different lender
Credit unions and B-lenders may accept income a bank won’t, often at a higher rate: see the best mortgage lenders in Canada and the B-lenders compared.
Benefits, assets and the RDSP
- Asset limits. Provincial programs limit the savings you can hold. ODSP’s limit for a single person is $40,000, and it doesn’t count the home you own and live in, your primary vehicle, RESPs and RDSPs. A down payment saved above a program’s limit can affect your benefits before the purchase closes, so the timing is worth checking with the program first.
- RDSP withdrawals. You can withdraw from an RDSP toward a home, but government grants and bonds paid into the plan in the 10 years before a withdrawal may have to be repaid; see RDSP withdrawal rules. The RRSP Home Buyers’ Plan doesn’t apply to an RDSP.
Documents lenders ask for
| Document | Purpose |
|---|---|
| Benefit statement or entitlement letter | Current monthly amount and that it continues |
| Notices of assessment for two years | Confirms the income you reported |
| T4A slips | For CPP-D and other government benefits |
| LTD policy and insurer’s letter | Benefit amount, duration and termination conditions |
| Recent bank statements | Show the benefit being deposited (see what lenders look for in your bank statements) |
| Employment letter, if you also work | Confirms the other income |
Common problems
| Problem | Usual approach |
|---|---|
| Income too low to qualify alone | A co-borrower, other income, or a larger down payment |
| LTD with a review date during the term | A letter from the insurer confirming the benefit continues |
| A lender won’t count provincial benefits | A credit union or B-lender, or combining income |
| No gross-up offered | A lender whose policy includes one |
| Credit problems from a period without income | Rebuilding first (see improving your credit score for a mortgage) |
Other non-standard income is covered in commission income, maternity or parental leave and self-employed mortgages.
Sources
The figures and rules on this page come from these sources, last checked against them between September 24, 2026 and September 29, 2026. How we check facts.
- CMHC: Calculating GDS / TDS
- CMHC: CMHC Purchase
- Government of Canada: Canada Pension Plan – Monthly payment amounts
- Government of Canada: Cpp disability benefit
- Government of Canada: CPP: How much you could receive
- Government of Ontario: Ontario Disability Support Program
- Government of Ontario: Ontario Disability Support Program eligibility for income support