CA

Disability Tax Credit review: everything you need to know

Check out the Disability Tax Credit review and learn how it works, who is eligible, and how to claim and apply.

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by Aline Augusto

Published on 11/24/2022

Disability Tax Credit: non-refundable tax credit in Canada

Learn how the Disability Tax Credit works. Source: The Mister Finance.
Learn how the Disability Tax Credit works. Source: The Mister Finance.

In this Disability Tax Credit review, you will learn how this benefit works. Keep reading to know everything you must before claiming for it!

Essentially, the Canada Revenue Agency (CRA) manages a complete list of benefits designed for people with disabilities.

Disability Tax Credit

How to apply for the Disability Tax Credit?

Learn how the Disability Tax Credit application works and what you need to do to receive the benefit from the Canada Revenue Agency (CRA).

Also, it is crucial to understand what a disability is. 

In a few words, a disability is a mental or physical condition of the body that makes a person interact differently with the world. 

Usually, one must suffer from a severe or prolonged disability to get government benefits like this one. The world as it is today does not include people with disabilities in daily activities, which makes life harder for them.

Therefore, institutions and society have an important role in this play, managing benefits and assuring legal rights to make life less difficult for them.

Today, as mentioned before, we will focus on a non-refundable tax credit provided by the Canadian government.

Learn everything you need right below in this Disability Tax Credit review!

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How does the Disability Tax Credit work?

The Disability Tax Credit (DTC) is a non-refundable tax credit. It reduces the income tax people with disabilities or their family members have to pay.

Therefore, the objective is to offset some of the costs related to the disability.

Also, it is important to mention that the disabilities in question are those considered severe or prolonged impairments, whether mental or physical conditions.

Essentially, it helps families or individuals with disabilities to reduce the costs of living.

The Disability Tax Credit is managed by the Canada Revenue Agency (CRA). Through this benefit, families, and individuals can get others.

For example, to apply for the Child Disability Benefit (CDB) an individual must first claim for the Disability Tax Credit.

The application process for the DTC is through a digital application. The Disability Tax Credit Certificate must be completed by a medical practitioner.

After the CRA approves the application, the person with disabilities or a family member may claim the tax credit.

DTC highlights

What are the highlights? Source: Freepik.
What are the highlights? Source: Freepik.

The Disability Tax Credit (DTC) is a non-refundable tax credit for individuals with severe or prolonged impairments and their family members to reduce the costs of living.

To apply and claim for the benefit, a medical practitioner must certify a person is eligible according to the criteria.  

Eligibility Requirements 

 People must follow some steps before claiming the tax credit.

Firstly, a medical practitioner needs to certify an individual has a prolonged or severe impairment, receives therapy for vital support, or has significant limitations.

In addition, the doctor must certify some categories are filled for each disability according to the eligibility criteria.

So, let’s suppose a doctor certifies an individual into the Mental Functions Category. Then, the individual must meet all three criteria to claim the benefit.

In summary, as mentioned before, a person may qualify as a marked restriction, life-sustaining therapy, or significant limitations.

The first two conditions mean that an individual is unable to do an activity, or takes much longer time to do an activity in comparison to a same-age person without disabilities.

Moreover, the disability must last for an expected period of at least 12 months, and the condition must be presented at least 90% of the time.

On the other hand, the last condition – significant limitations – means that combined limitations have cumulative effects that are equivalent to the criteria listed above.

If you are eligible for the DTC, you may be eligible for other provincial, territorial, and federal programs and benefits, such as Child Disability Benefit (CDB), Canada Workers Benefit, and Registered Disability Savings Plan.

How to apply for the Disability Tax Credit?

Now, learn how to apply and claim the Disability Tax Credit (DTC) by reading our next post!

Disability Tax Credit

How to apply for the Disability Tax Credit?

Learn how the Disability Tax Credit application works and what you need to do to receive the benefit from the Canada Revenue Agency (CRA).

About the author

Aline Augusto

My name is Aline Mesquita; I'm a writer here on the blog, where I write about finance in general and other subjects. I have been working with content creation for ten years. Also, I'm post-graduated in Project Management, with expertise in SEO practices. Currently, I am studying finance, market trends, and cryptocurrencies.

Reviewed by

Aline Barbosa

Senior Editor

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