Demystifying the Disability Tax Credit
The disability tax credit (DTC) is an important program for those facing severe and prolonged physical or mental impairment. Some individuals face unique barriers when it comes to completing their application and claiming the credit. On this page, we are correcting some of the most common myths to ensure that eligible individuals are aware of their entitlements under the DTC program.
Myth #1: My income is not taxable so there is no benefit for me to apply for the DTC.
Fact: Being eligible for the DTC can help you in a number of ways. If you think you may be eligible, you should apply even if you do not have taxable income. Being approved for the DTC can help you access other federal programs, such as the registered disability savings plan, the Canada workers benefit disability supplement, and the child disability benefit.
Myth #2: The DTC application process is difficult.
Fact: The CRA has made it faster and easier than ever to apply for the DTC. You no longer need to print and fill in the form by hand, and take it to your medical practitioner. You can now complete Part A of the application form online via My Account or by phone and give your medical practitioner a reference number for them to use to fill in Part B of the form. Once your application has been submitted to the CRA, you can track its status in My Account using the Progress Tracker.
You can also call us at 1-800-959-8281. We are happy to help you through the process!
For more information, visit: How to apply - Disability tax credit (DTC) - Canada.ca.
Myth #3: I don't have a doctor so I can't apply for the DTC.
Fact: There are several types of medical practitioners who are able to complete and certify the effects of the impairment in Part B of the T2201 application. These include doctors, nurse practitioners, optometrists, audiologists, occupational therapists, physiotherapists, psychologists, and speech-language pathologists. For more information online, visit: How to apply - Disability tax credit (DTC) - Canada.ca.
Myth #4: The CRA will only approve DTC for certain diagnosed medical conditions.
Fact: Eligibility for the DTC is not based on a diagnosis. It is based on the effects of an impairment in physical or mental functions that is severe and prolonged, resulting in a marked restriction.
All DTC applications are reviewed on a case-by-case basis.
For more information visit: Who is eligible - Disability tax credit (DTC) - Canada.ca.
Myth #5: The DTC is a monthly payment.
Fact: The DTC is a non-refundable tax credit that reduces the amount of tax you may have to pay. It may result in a portion of the income tax that you have paid to be refunded to you when you file your tax return. It is not a monthly payment.
Any unused portion of the DTC can be transferred to a supporting family member. Eligibility for the DTC can go back a maximum of 10 years from the date the CRA received the application.
For information on how to claim the DTC amount, visit: Claiming the credit - Disability tax credit (DTC) - Canada.ca.
Myth #6: There is nothing I can do if CRA denied my DTC application.
Fact: The CRA’s decision is based on the information given by the medical practitioner in Part B.
If you disagree with the CRA’s decision, you have options.
You may:
- speak with a contact centre agent by calling 1-800-959-8281 to discuss your application
- request a second review of your application and submit any additional medical information that has not already been sent
- appeal CRA’s decision by filing an income tax objection within 90 days of the date on your notice of determination.
Your notice of determination will explain why your DTC application was denied.
Myth #7: I receive provincial disability or other federal disability payments so I must be eligible for DTC.
Fact: Eligibility for the DTC does not depend on other federal or provincial benefits. If you receive Canada pension plan or Quebec pension plan disability benefits, workers’ compensation benefits, or other types of disability or insurance benefits, it does not necessarily mean that you are eligible for the DTC.
Other programs have different purposes and criteria. For example, workers' compensation benefits are based on an individual’s inability to work.
Myth #8: I am unable to work so I should be eligible for DTC.
Fact: Eligibility for the DTC is based on the effects caused by one or more impairment(s) (resulting from a medical condition) in one or more of the following categories: walking, mental functions, dressing, feeding, eliminating, hearing, speaking, vision, and life-sustaining therapy. It is not based on an inability to work, to do housekeeping activities, or to engage in recreational activities. Although the effects may result in an inability to work, the CRA does not determine eligibility based on this factor.
Myth #9: I have more than one impairment so I should receive more money.
Fact: You may experience limitations in more than one of the categories for the DTC, however you can only claim the DTC once a year for yourself. This is done on your income tax return. The claim that you make for the DTC on line 31600 of your tax return is a fixed amount that is indexed yearly.
Myth #10: I have to reapply for the DTC every year.
Fact: DTC approval periods vary depending on the effects of the impairment. DTC eligibility may expire after a certain number of years and you will have to re-apply at the end of that period.
Your notice of determination will tell which year(s) you are eligible for the DTC. This information can also be viewed in My Account.
When your eligibility is about to expire, we will notify you on your notice of assessment. These notices will appear one year in advance of, as well as in the year it expires.
If you have been approved for the DTC on an ongoing basis and your notice of determination does not indicate an expiry date, please do not submit a new T2201 unless we ask for one.
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