How To Calculate IRBs for Self-Employed Individuals
Employment status is essential to determine IRB. The calculation of IRBs for self-employed people can be complex. However, the insured person can hire a public accountant to calculate their IRB, and the insurer is required to pay up to $2,500 for that report as per s. 7(4) and (5) of Statutory Accident Benefits Schedule (SABS).
Self-employed income for IRBs is calculated on the 52 weeks pre-accident if they were self-employed at any time during the four weeks pre-accident or their income in the 52 weeks pre-accident (whichever is higher). Many financial documents need to be provided to the accountant.
A self-employed person’s losses can be deducted from the employment income as decided in the License and Appeal Tribunal’s reconsideration decision in 17-005894 v WDW. In addition, post-accident business income can be deducted from the IRB entitlement as found by the Divisional Court decision in Surani v. Perth Insurance Company.
However, deductions that are permitted from IRB benefits are as follows:
- CPP Disability Pension Benefits
- Periodic payments of insurance
- Any gross weekly payments for loss of income received or available to the person as a result of the collision (i.e. employment insurance, disability benefit plans, workers compensation)
- Collateral benefits (temporary disability benefits and periodic payments).