What is permanent total disability in Canadian workers' comp?
Permanent total disability describes a workplace injury so severe that you cannot return to any suitable employment. The board pays a full loss-of-earnings benefit, typically 85% of net average earnings in Ontario (90% of net in some provinces), usually continuing until retirement age.
Do permanent total disability benefits continue for life?
Wage-loss benefits generally continue to age 65 (retirement age), at which point a separate Loss of Retirement Income benefit may begin. Boards fund a retirement set-aside during the benefit period, in Ontario about 5% of the loss-of-earnings payments, to provide income after 65.
Is a permanent total disability benefit taxed?
No. Like all workers' compensation wage-loss benefits in Canada, permanent total disability payments are not taxable. That is why the benefit is calculated as a percentage of net (after-tax) average earnings rather than gross pay.
Can a permanent total disability benefit be reviewed?
Yes. Boards periodically review entitlement and can adjust benefits if your medical condition or earning capacity changes materially. However, for genuinely catastrophic injuries with no prospect of return to work, benefits are generally stable through to retirement age.