Claiming the Canada Disability Tax Credit.
The Disability Tax Credit (DTC) is different from other disability benefits plans. Unlike disability insurance plans that focus on how your medical condition affects your ability to work, the DTC focuses on impairment with your daily activities.
Eligibility
There are several medical conditions that qualify for the DTC. However, You automatically qualify for the DTC if your medical condition causes blindness or you need life-sustaining therapy. You also automatically qualify if you have Type 1 diabetes.
You may be eligible for the DTC if you are:
- blind
- markedly restricted in at least one basic activity of daily living
- significantly restricted in two or more basic activities of daily living
- need life-sustaining therapy
To qualify as blind, your visual acuity in both eyes must be 20/200 or less. Or your field of vision in both eyes is 20 degrees or less.
And to qualify for the life-sustaining therapy requirement, you need therapy to support a vital function. And you have to need it at least three times per week for an average of 14 hours per week.
Basic activities of daily living (BALD)
To qualify for the Disability Tax Credit (DTC), you must show that you became markedly restricted in one basic activity of daily living.
The basic activities of daily living (BADL) include the following:
- Speaking
- Hearing
- Walking
- Eliminating (bowel or bladder)
- Feeding
- Dressing
- Mental functions necessary for everyday life
Marked restriction
A marked restriction means you cannot do a BADL, or it takes excessive time to do it. It also must be present 90% of the time.
Cumulative effect of significant limitations
Alternatively, you can still qualify for the DTC if you show that your medical condition meets the cumulative effect of significant limitations requirements. This means you must be significantly limited in two or more of the BADLs. A significant limitation is one that doesn’t quite meet the requirement for marked restriction and is present at least 90% of the time.
Life-sustaining therapy
You can also qualify for the DTC if you meet the life-sustaining therapy requirement. Life-sustaining therapy is defined as therapy that:
- is essential to sustain a vital function;
- is required to be given at least three times each week for a total duration averaging not less than 14 hours a week and
- can not reasonably be expected to significantly benefit persons who are not so impaired.
Therapies that may meet this requirement include insulin therapy, kidney dialysis, taking medical foods and formulas, and more.
Overall, the DTC is the most complicated disability benefit. Keep in mind the focus is not on your ability to work. Instead, it focuses on the extent to which your medical condition(s) results in marked impairment in the basic activities of daily living. Or the extent to which your medical condition(s) resulted in the cumulative effect of significant restriction in two or more basic daily living activities.
