People living in Canada during the 2013 tax year who suffer with Alzheimer’s, have the disability tax credit options available to them. Once the disability tax credit has been granted to an individual, it enables them to be considered for additional disability monetary compensation, in which the options vary depending on each individual’s specific situation.
By definition, the Disability Tax Credit, sometimes shortened to DTC, is a tax credit open to Canadian residents that have been suffering from a disability, physical or mental, for a 12 month span of time. The disability must be considered to be severe enough to impair the individual’s daily life and hinder then from functioning normally on their own. The disability tax credit is a non-refundable tax credit.
Alzheimer’s, which is a cognitive disease, is one of the most common conditions that regularly qualify for the disability tax credit. In addition, a family member who is supporting the person with Alzheimer’s disease will also have the ability to be awarded the disability tax credit.
It is significant that Canadians considering applying for the disability tax credit understand that there are two different sub-categories that fall within the disabled definition.
- The Disabled Group- This group of people is unable to complete the basic daily activities that we must do in order to live a normal life. This is the most common of the two groups and the most obvious.
- The Slowed Group- A lesser amount of people typically fall into this group, but it is still highly impactful and often overlooked. This group of people performs the basic daily activities or tasks in a much slower manner.
No matter which group you or your family member fall into, you will still receive the same amount of money as your disability tax credit, once approved.
Qualifying for the Disability Tax Credit
The Canadian Tax Credit Guide states that in order to qualify for the disability tax credit during the 2013 year, the person must have been distressing from lengthened physical or mental impairment. Typically, the person’s condition will be reviewed, and they must have been suffering for a 12 month period of time in order to apply.
If you are the parent or primary caregiver of a child 18 years or younger, and need to look into the child disability benefit (CDB), the same standards apply. For more information, download our Disability Tax Credit for Children Guide.
People who are applying for the disability tax credit for the very first time will experience the Canada Revenue Agency (CRA) looking over their claim and deeming them eligible or ineligible before moving forward to evaluate the tax return.
Being that the disability tax credit is transferable, if for any reason the individual is not able to take advantage of the tax credit, it can be transferred to the following individuals: nephew, niece, uncle, aunt, brother, sister, spouse, child, or parent. Though, the person who is making the claim must be “dependent on the tax payer for support.”
Lastly, a claim is not eligible to be made if a medical expense credit has already been made on the individual’s behalf. Being that there are so many regulations in regards to the disability tax credit, it is highly recommended that the individual consult with a tax advisor in order to properly analyze the individual’s specific situation.
The Process of Applying for the Disability Tax Credit
The steps towards properly applying for the disability tax credit start with the individual attaining Form T2201, which is the disability tax certificate. The individual must fill out Part A themselves, while part B needs to be completed by a licensed doctor. The patient will then undergo a medical examination by the chosen doctor. Following the examination, the doctor must certify the patient’s Form T2201 claim in order to move forward with the process.
Form T2201, the disability tax certificate, can easily be found on the Canada Revenue Agency official website. The form can easily be printed from your home computer, or digitally filled out and submitted online.
The medical certification must state that the patient has both relentless and prolonged impairment that restricts them from participating in daily activities. Once Form T2201 has been completed, it will be passed along to the Canada Revenue Agency for review. If approved, the disability tax certificate will be in effect as long as the person remains ill.
According to the Canada Revenue Agency, if you were qualified for a disability tax credit during the previous tax year, and still meet the requirements to receive this tax credit, you will not need to submit an additional Form T2201 for the next year.
The disability tax credit rate is currently:
- $7,546 can be claimed if you are age 18 and above.
- If you are under age 18, you are eligible to claim an additional amount of $4,402. This additional supplement can be decreased if there were child care or attendant care expenses claimed.
Important Disability Tax Credit Information
It is beneficial for individuals considering applying for the disability tax credit or already approved for it to know that it is purely a tax reduction credit. This means that there are not any negative associations or financial impact to the people receiving this credit. The disability tax credit is not considered to be income, and will not hinder the individuals other income sources or health benefits.
In addition, it’s important for the claimant to look into implications arising from receiving lump sum income tax credit refunds.
The Importance Of Applying For The Disability Tax Credit
With so many options available to those suffering with a life altering disability such as Alzheimer’s, it is important for individuals to take advantage of everything being offered to them. With services and programs expanding every year to help individuals and families and children of these individuals, failing to apply will leave them without the ability relieve some financial stress and complete basic daily activities that they are currently struggling with. Taking the time to apply for the disability tax credit will greatly enhance your quality of life.