​Disability Tax Credit

Disability Tax Credit

Our qualified Occupational Therapy practitioner is registered in Ontario; part of the assessment process will examine the documents to determine the appropriate categories to be completed regarding the clients disability.

The OT then determines whether the effects of the condition are severe and prolonged, further whether or not our client is markedly restricted in performing activities of daily living through the answering of the various questions on the forms provided by Canada Revenue Agency. The categories of conditions are: Vision, Hearing, Walking, Elimination (bowel or bladder functions), Feeding, Dressing, Performing the mental functions necessary for everyday life, Life-Sustaining Therapy and the Cumulative effects of significant restrictions (after 2005). The OT will also indicate the date on which the marked restriction began and CRA uses this date as the date upon which a person became eligible for the credit if they are approved. This date is not necessarily the date of the diagnosis. ** The Occupational Therapy area of assessment will be: Dressing, Feeding, and Walking **

I will examine both your medical documents and the documents from CRA to determine the appropriate categories to be completed regarding your disability. Once all necessary applications are completed and assessment report is complete, I provide my clients with the paperwork to send to Canada Revenue Agency.

What is the 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 eligible?

The most most important notion to remember is the condition or disability is not the determining factor for approval with CRA tax credit. What is most important is the impact and cumulative effects of the individuals condition on that person's independent daily living activities (ADL) and abilities to carry the ADL's out independently.

People who have a severe mental or physical impairment which impacts the basic activities of daily living and/or need and dedicate time for Life Sustaining Therapy are eligible. The impairment has to have lasted or is expected to last for a period of 12 continuous months.

Re-file for Prior Years:

Upon approval of the Disability Tax Credit, the Income Tax Act allows the person with the disability or their supporting person to re-file their income tax returns for up to 10 years when they failed to take advantage of the credit. This could provide thousands of dollars of tax repayments to the individuals involved. To request a review of the prior years for which a person was eligible is an extremely simple process. All that is required is a letter to CRA containing the details of the request such as the years involved and other identifying information. A representative at CRA will complete all the calculations that are necessary to process a refund Cheque. It could take up to 6 months for the refund to arrive but it is well worth the wait.

Filing for Future Years:

Once the Disability Tax Credit has been approved, people can not only re-file for prior years but they can also claim the credit in future years. When completing the income tax return, either the person with the disability (if they have taxable income to be reduced to zero) or the supporting person can claim the credit.

To claim the disability amount for prior years, you will need to check mark the disability tax credit certificate form in Section 3 of t2201 to have previous taxes reassessed now making additional paperwork unnecessary. .

In summary, the Disability Tax Credit is something that every person with a disability should examine! It is simple to apply for and can provide some significant dollar advantages to individuals and their families.

Services I Provide:

  • Type of impairment Occupational Therapy practitioner can certify (walking, feeding, dressing, and the cumulative effect for these activities)
  • Complete and Certify Part B of Form T2201
  • Disability Tax Credit Application Assistance
  • Child Disability Tax Credit (T2201 Disability Tax Credit Certificate) complete and certify Part B.

Professional Service Rates: We charge fee-for-service and issue a receipt upon final payment for the Occupational Therapy services. You can take this receipt and submit to your insurance company for reimbursement and tax expenditure. Depending on the length of the assessment and how many hours of work is required, our OT may charge either the professional hourly rate or a flat rate can be worked out. New Therapy Solutions works with all all of our clients to make our services as affordable for our clients as possible. The rate will include the in-person assessment meeting and completion of a comprehensive Occupational Therapy Functional Assessment Report. In addition support with filling out Canada Revenue Agency Application, and supporting documentation which is often required.

** You are responsible for any fees that a medical practitioner charges to complete Form T2201. However, you may be able to claim these fees as medical expenses on line 330 or line 331 of your income tax and benefit return.

When To File: You can send Canada Revenue Agency the form at any time during the year. By sending CRA your form before you file your income tax and benefit return, you may prevent a delay in your assessment. CRA will review your application before they assess your return.