A personal tax credit that often goes unclaimed because taxpayers are not aware of it is the Disability Tax Credit (DTC). This is a non-refundable credit (i.e. a tax credit that can only reduce a taxpayer’s liability to zero) of $8,235 for 2018.
To be eligible for this credit, the taxpayer must have form T2201 Disability Tax Credit Certificate completed by a medical doctor or nurse practitioner. They must certify that you have a severe and prolonged mental or physical impairment which markedly restricts the ability to perform a basic activity of daily living. Areas of basic activity include: speaking, hearing, walking, elimination, feeding, dressing or performing the mental functions necessary for everyday life. T2201 must be submitted to CRA for approval before being eligible. Once approved by CRA, it is possible to go back 10 years, if the impairment was present for those years, and adjust the previously filed tax returns to claim the DTC, potentially resulting in a large tax refund to the taxpayer. If the taxpayer can’t make use of all or part of the DTC, due to its non-refundable nature, the credit can be transferred to a spouse, common law partner or a supporting taxpayer, such as a parent or child.
If you think you or someone you know may qualify for this tax credit, contact your accountant, medical doctor or nurse practitioner to review your options for applying.