Archived - Health-Related Tax Measures in Economic Action Plan 2014

Facilitating access to tax relief on health care services and providing additional tax relief relating to the health care costs that Canadians face will help them manage or improve their health and financial situation.

Economic Action Plan 2014 proposes to provide additional tax relief for medical and disability-related expenses of Canadians by expanding the list of eligible expenses under the Medical Expense Tax Credit and exempting services such as acupuncturists’ and naturopathic doctors’ professional services from the Goods and Services Tax/Harmonized Sales Tax (GST/HST).

The measures proposed in Economic Action Plan 2014 include:

• Expanding the list of eligible expenses under the Medical Expense Tax Credit to include costs associated with service animals specially trained to assist individuals with severe diabetes, such as diabetes alert dogs.
• Providing further tax recognition for costs associated with eligible specially designed medical therapies and training, by:
  • Expanding the current GST/HST exemption for training that is specially designed to assist individuals in coping with a disorder or disability to also exempt services of designing such training, such as developing a training plan; and
  • Including amounts paid for the design of an individualized therapy plan as an eligible expense for income tax purposes under the Medical Expense Tax Credit.
• Exempting acupuncturists’ and naturopathic doctors’ professional services from the GST/HST.
• Adding eyewear specially designed to electronically enhance the vision of individuals with vision impairment that is supplied on the order of a physician or other specified health professional to the list of GST/HST-free (zero-rated) medical and assistive devices.

Changes to the Medical Expense Tax Credit will apply to expenses incurred after 2013. Changes to the GST/HST health-related measures will apply as of February 12, 2014.

The measures proposed in Economic Action Plan 2014 will complement previous actions taken by the Government since 2006 to provide tax relief and other support to individuals faced with high medical expenses. These include:

• Adding to the list of eligible expenses under the Medical Expense Tax Credit certain costs for service animals specially trained to assist an individual who is severely affected by autism or epilepsy, as well as certain medical devices (specifically, blood coagulation monitors, altered auditory feedback devices, electrotherapy devices, standing devices for standing therapy, and pressure pulse therapy devices);
• Adding blood coagulation monitors, neuromuscular stimulation devices for individuals with severe mobility impairment, chest wall oscillation systems for use in airway clearance therapy and chairs specially designed for individuals with a disability to the list of GST/HST zero-rated medical and assistive devices;
• Exempting from the GST/HST pharmacists’ professional non-drug dispensing services, (prescription drug dispensing services are already zero-rated under the GST/HST);
• Expanding the zero-rated treatment under the GST/HST for corrective eyeglasses or contact lenses supplied on the “prescription” of an eye care professional to include corrective eyeglasses or contact lenses supplied under authority of an “assessment record” produced by a person (i.e., an optician) who is entitled under the laws of the province in which the person practices to issue an “assessment record” authorizing the dispensing of corrective eyewear;
• Expanding the list of health care professionals on whose order certain medical and assistive devices are zero-rated under the GST/HST, so as to reflect the increasing involvement of health care professionals, such as nurses, in giving orders for these devices;
• Adding the drug “Isosorbide-5-mononitrate” to the list of non-prescription drugs that are zero-rated under the GST/HST;
• Exempting under the GST/HST, training specially designed to assist individuals in coping with a disorder or disability;
• Providing a GST/HST exemption for midwifery services and expanding the exemptions for nursing and home care services;
• Increasing the maximum amount of the Refundable Medical Expense Supplement, which recognizes the loss of income-tested benefits and services when a person with extraordinary disability or medical-related expenses moves from social assistance into the labour force;
• Removing the $10,000 limit on the amount of eligible expenses a taxpayer can claim under the Medical Expense Tax Credit in respect of a financially dependent relative; and
• Providing a GST/HST exemption for hospital parking for patients and visitors.

For more information, visit Economic Action Plan 2014.