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What is Disability Tax Credit?
The disability tax credit (DTC) is a non-refundable tax credit that helps persons with disabilities or their supporting persons reduce the amount of income tax they may have to pay. An individual may claim the disability amount once they are eligible for the DTC. This amount includes a supplement for persons under 18 years of age at the end of the year.
The purpose of the DTC is to provide for greater tax equity by allowing some relief for disability costs, since these are unavoidable additional expenses that other taxpayers don’t have to face.
Being eligible for the DTC can open the door to other federal, provincial, or territorial programs such as the registered disability savings plan, the working income tax benefit, and the child disability benefit.
Who is Eligable for Disability Tax Credit?
In order to be eligible for the Disability Tax Credit you must be a Canadian taxpayer. You are eligible for the Disability Tax Credit only if the Canada Revenue Agency approves Form T2201. A medical practitioner has to complete and certify that you have a severe and prolonged impairment and must describe its effects. Nurse practitioners are able to certify Form T2201 as per the Federal Budget 2017.
If we have already told you that you are eligible, do not send another form unless the previous period of approval has ended or if we tell you that we need one. You must tell us immediately if your condition improves.
What are the eligable Disabilities?
Although by no means complete, here are some of the eligible disabilities;
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- ADHD (attention deficit hyperactivity disorder)
- PTSD (post traumatic stress disorder)
- OCD (obsessive compulsive disorder)
- alzheimer's disease
- anxiety
- bi-polar disorder
- dementia
- developmentally delayed
- difficulty walking any extended distance (a city block)
- down syndrome
- learning disabilities
- mental illness
- stroke
- and many more. Please contact us to discuss your situation.
When will I receive my Disability Tax Refund?
From the date your application is submitted to the Canada Revenue Agency, it can take anywhere from 3 to 6 months. The Canada Revenue Agency (CRA) will generally deposit the funds directly into your bank account, however you can choose to receive a cheque if you prefer.
Will the Disability Tax Credit cause any problems with my taxes?
No. In fact, the DTC can work in your favor, whether a refund (increase) or a payment (decrease).
How come I have never heard about the Disability Tax Credit?
The Disability Tax credit is a very specialized Tax Credit. At RCD, we have experts who are familiar with the application process and we will be here to help you through the process, from start to finish. You can read about the Disability Tax Credit (DTC) at the Canada Revenue Agency (CRA) website.
If the person with the disability is deceased can a family member still apply for the Disability Tax Credit?
Yes. As long as the person has been deceased for under ten years.
What if I owe money to the Canada Revenue Agency?
The Canada Revenue Agency will first pay off your debts to them and then send you the remaining balance.