The Disability Tax Credit is a federally regulated program designed to help Canadians living with physical or mental limitations. While the tax benefit has the potential to be life-transforming, the application and approval process can be difficult to navigate and overwhelming. At ChildDisabilityCredit.com we are here to help by providing you with everything you need to know about the Disability Tax Credit. As a Canadian, it is your right to know what benefits are available for your children. Start exploring here and feel free to reach out with any questions.
Canada’s #1 Resource for Parents
with Children who Suffer from a Disability
The Disability Tax Credit
A Growing Family is Expensive
In today’s economy, raising a family is expensive. Nor is it any easier if one or more of your children suffer from a disability. That’s where the Disability Tax Credit comes in. By understanding the program, obtaining the credit and applying it to past and future tax returns, many Canadians have received tens of thousands of dollars. What would your family do with the extra help?
Frequently Asked Questions
1. What is the Disability Tax Credit (DTC)?
The Government of Canada through Canada Revenue Agency (CRA) offers various tax refunds and benefits for individuals with disabilities. These benefits are provided for Canadians with many different types of health issues. The Disability Tax Credit (DTC) is one of the most important of these programs as it can go a long way towards helping offset the additional expenses associated with a prolonged impairment in physical or mental functions. The DTC is defined as a non-refundable tax credit which can help reduce a person’s taxable income to zero.
2. How to Apply for the DTC on behalf of my child?
The Disability Tax Credit is open to Canadians of all ages. In fact, a supplemental amount is available for any applicant who is 18 years old or younger making this benefit a real game-changer for families with a disabled child.
So how does one get approved? Firstly, your child must have a severe impairment in physical and/or mental functions. Secondly, this impairment must be prolonged such that it has been persistent or will remain persistent for a continuous period of at least 12 months. For a more detailed explanation of eligible medical conditions see here (link to eligible medical conditions.) Finally, the applicant will need to have a medical professional complete the Disability Tax Credit Certificate, attesting to the severity and duration of their disability or medical condition.
3. How much are we entitled to for our child?
The amount of the DTC varies by province and age of the applicant. For an adult it can currently range from $1,600 -$2,700 per year. For a child an additional $900-$1,800 per year could be expected on top of the basic amount. In other words, you can be entitled to a maximum of $,4,500 per year for an eligible child. One of the features that makes the DTC so important and life-changing is that it can be claimed retroactively up to 10 years in the past.
4. What’s the difference between the Disability Tax Credit (DTC) and the Child Disability Benefit (CDB)?
The Child Disability Benefit is a tax-free benefit of up to $227.50 per month ($2,730 per year) for families that care for a child under 18 who suffers from a severe and prolonged impairment in their physical and/or mental functions and who qualifies for the Disability Tax Credit. In other words, the Child Disability Benefit is a tax-free addition to your regular Canada Child Benefit amount. The current amount of $227.50/month is indexed annually for inflation. This amount starts being reduced when the adjusted family net income is more than $65,000.
5. What is an RDSP and how does my child qualify for it?
A registered disability savings plan (RDSP) is a savings plan that is intended to help parents and others save for the long-term financial security of a person who is eligible for the disability tax credit (DTC). It is a Canada-wide registered matched savings plan specific for people with disabilities. It is designed to help the holder be better financially prepared for their future, keeping in mind that disabled Canadians will inevitably have higher than average expenses.
Disability Tax Credit Calculator
Wondering what the Disability Tax Credit can do for you or someone you love? We created an easy-to-use Calculator that can estimate what you might be entitled to if you were approved for the Disability Tax Credit. To get started, click the button below.