Self-Employment Without Last Fiscal Year, Eligible for 52 Weeks Before the Accident?

Is a self-employed individual who had not completed a full fiscal year of operations prior to an accident eligible for a calculation of their pre-accident income considering the 52 weeks before the accident?

Past Licence Appeal Tribunal decisions have suggested that a self-employed individual’s pre-accident income must be quantified solely considering the last fiscal year completed before the accident.  These decisions created uncertainty regarding how to quantify pre-accident income for a self-employed individual whose business had not yet completed a full fiscal year before an accident.

The question that arose was, is there a “blind spot” in the Statutory Accident Benefits, where these individuals would not have a period available to them to quantify their pre-accident income?  As this issue had not been specifically addressed it resulted in inconsistent approaches from insurer to insurer.

However, the recent [FT] and The Co-operators Insurance Company (19-001291/AABS) decision specifically comments on how to approach the above situation.

In this decision, the applicant was involved in an accident on February 5, 2018 and had commenced operating a landscaping business (“Landscaping”) during June 2017.  Landscaping had a fiscal year end of June 2018 and, as such, a full fiscal year (i.e. June 2017 to June 2018) had not been completed before the accident.

In regards to how to quantify the applicant’s pre-accident income, the adjudicator stated, “The applicant may not use the landscaping business’ last fiscal year before the accident because as per section 4(2)3 there was no fiscal year for the landscaping business that was completed on or before the day of the accident.  Thus, the applicant is confined to the last 52 weeks before the accident for the calculation of his IRBs.”

Therefore, does the adjudicator’s interpretation remove the “blind spot” by providing the applicant with a calculation of his pre-accident income considering the 52 weeks before the accident as Landscaping had not completed a full fiscal year before the accident?

Read the decision in full detail here: [FT] and The Co-operators Insurance Company (19-001291/AABS)