The Canadian Disability Tax Credit: A Lifeline for Those with Invisible Disabilities

Written By Carroll Meilleur

Breaking down the key elements of the Canadian Disability Tax Credit, its benefits, and how those with invisible health conditions can benefit from it.

Written by Carroll Meilleur

Blog sponsored by True North Disability Services.

Note: Names have been changed to protect the privacy of the individuals involved.

Imagine waking up and heading to the kitchen for breakfast, only to find your cupboards nearly bare. Despite carefully rationing what little food you had left, all that remains is a single box of couscous. You prepare your meal with a glimmer of hope, knowing there’s just enough money coming in tomorrow for a modest grocery run.

As you sit, lost in thought, the phone rings. A familiar knot forms in your stomach, hoping it’s not another bill collector. But this time, the call brings a different message. To your amazement, the voice on the other end tells you the news you’ve been waiting for - the reassessments of your taxes have been completed, and your refund—thanks to the Disability Tax Credit—is on its way, set to arrive in just a couple of days!

Relief and joy wash over you, and the image of fresh fruit comes to mind. You shout out, “I can buy a cantaloupe!”

Contents:

  • The Impact of the Disability Tax Credit - Why it Matters

  • What is the Disability Tax Credit?

  • Who is Eligible for the DTC?

  • How the DTC Can Benefit You and Your Family

  • Common Difficulties in Applying for the Disability Tax Credit

  • Simplifying the Process with True North Disability Services

  • Take the First Step

  • Additional Resources

The Impact of the Disability Tax Credit - Why it Matters

Sadly, many Canadians are in this position today, with the cost of groceries soaring while wages and pensions fail to keep pace.

Susan reached out to us in March of 2023 on behalf of her 22-year-old daughter, Jessica, who lives with Autism, Anxiety, Depression and ADHD. Between March 2023 and April 2024, there were 49 calls and emails exchanged between True North Disability Services, the client, the doctor, and the CRA. We worked diligently to ensure Susan and her daughter received every dollar they were entitled to.

By August 2023, Susan’s daughter had been approved for the Disability Tax Credit for the years 2015 through 2028 - fantastic news! By the end of that month, Jessica received her first tax refund of $3,000 and by the end of September, she received the final amount of nearly $1,000.

Susan’s case, as the transfer for Jessica, took a little longer as Jessica’s taxes had to be adjusted first. But there was more good news; she could claim the tax credit for any years Jessica didn’t have enough income to utilize it all, AND, Susan was eligible for the Child Disability Benefit for the years Jessica was a minor!

In December, just in time for Christmas, Susan received a small tax adjustment of $800. While this may not sound like much, Susan herself hadn’t been able to work consistently over the years due to her own health challenges. That $800 made a real difference. And it was in the spring, when things got really tough, that she finally received the nearly $8,000 refund she so desperately needed. This allowed her to not only buy that cantaloupe but also fill her kitchen with the groceries she’d been longing for. Outside of the basic necessity of food, it also helped relieve some other financial pressures for Susan. 

It's stories like Jessica and Susan’s that encourage us to continue the work we do.

Living with an invisible condition often brings challenges that are not always obvious to others but can have a profound impact on daily life and financial well-being. Whether you’re managing chronic pain, mental health conditions, or other non-visible impairments, financial relief can be crucial. One resource that can provide significant support is the Disability Tax Credit (DTC). This often-overlooked benefit offers financial relief to individuals with disabilities and their families.

What is the Disability Tax Credit?

The Disability Tax Credit (DTC) is a non-refundable tax credit offered by the Canadian government to individuals of any age with life-limiting conditions. It helps reduce the financial burden of living with a disability by lowering the amount of income tax owed. For those with invisible conditions, this credit can mean thousands of dollars in savings, providing much-needed financial relief.

The DTC covers a broad spectrum of both visible and invisible physical and mental impairments. Conditions such as chronic pain, depression, anxiety, autoimmune diseases, and cognitive impairments may qualify, provided they meet the criteria set by the Canada Revenue Agency (CRA).

Who is Eligible for the Disability Tax Credit?

Eligibility for the DTC is based on how a medical condition affects your ability to perform essential daily activities such as walking, dressing, feeding, vision, speaking, hearing, using the washroom, and mental functions necessary for everyday living. Many people with invisible conditions struggle with these activities, and as a result, they may qualify for the DTC.

Here are some common invisible conditions that may qualify for the DTC:

  • Mental health conditions (e.g., depression, anxiety disorders)

  • Chronic illnesses (e.g., Crohn’s disease, multiple sclerosis, lupus)

  • Autoimmune disorders (e.g., rheumatoid arthritis)

  • Chronic pain or fatigue (e.g., chronic fatigue syndrome, arthritis)

Even if your condition isn’t visibly apparent, it’s essential to explore whether it significantly impacts your ability to perform daily activities, as this can qualify you for the DTC.

True North Disability Services offers a complimentary eligibility assessment to help you determine if you may qualify.

How the Disability Tax Credit Can Benefit You and Your Family

The financial benefits of the DTC can be substantial, offering tax savings and potential refunds. Here are a few key advantages:

  1. Tax Savings: The DTC reduces the amount of income tax you or your caregiver must pay. Savings vary based on individual tax situations, but many applicants see significant refunds.

  2. Retroactive Payments: If you qualify for the DTC but didn’t claim it in previous years, you may be eligible to receive refunds for up to 10 years’ worth of taxes, providing a substantial lump-sum payment.

  3. Continued Tax Relief: Once approved for the DTC, you can continue to receive tax savings for 5-7 years or longer, providing ongoing financial relief.

  4. Additional Programs: The DTC opens doors to other valuable programs such as the Registered Disability Savings Plan (RDSP) and the Child Disability Benefit (CDB).

The RDSP and Child Disability Benefit (CDB)

  • The Registered Disability Savings Plan (RDSP) is a powerful savings tool for individuals under the age of 49 who qualify for the DTC. It allows you to save for long-term financial security, with matching government contributions and grants that can help your savings grow significantly over time.

  • The Child Disability Benefit (CDB) provides additional monthly support for families with children under 18 who qualify for the DTC. It helps cover costs associated with raising a child with a disability, ensuring that families receive the support they need.

Common Difficulties in Applying for the Disability Tax Credit

Applying for the DTC can be challenging, especially for those with invisible disabilities, as some face obstacles that aren’t always expected. Here are some common challenges:

  1. Misconceptions by Medical Professionals: Many doctors mistakenly believe that a person must be visibly disabled, in a wheelchair, or unable to work to qualify for the DTC. This is not true—many invisible conditions qualify, and these misconceptions can be a major roadblock in the application process.

  2. Lack of Supporting Medical Records: Some medical practitioners may not have the necessary records on file to support the claim. In such cases, True North Disability Services (TNDS) works with past providers to retrieve the needed documentation. If your doctor doesn’t provide enough information for the CRA to approve your claim, we work with them to clarify and ensure the application is complete.

  3. Administrative Errors by CRA: Even after approval, administrative issues can arise. For example, the CRA may fail to request necessary tax adjustments or the transfer of remaining credits to a family member. TNDS ensures that these steps are followed through to maximize the financial benefit.

Simplifying the Process with True North Disability Services

Navigating these obstacles can be overwhelming for individuals already managing health challenges. That’s where True North Disability Services (TNDS) can help.

As we celebrate our 10th anniversary, we reflect on a decade of helping thousands of Canadians secure the benefits they deserve through the DTC. Whether you’re applying for the first time, have the DTC already and are not sure you have received all the benefits you are entitled to, concerned about missing documentation, or exploring retroactive benefits, we’re here to support you every step of the way.

From gathering necessary paperwork to submitting the application and communicating with the medical practitioner and CRA on your behalf, our team removes the guesswork, giving you peace of mind to focus on your health and well-being.

Take the First Step

While applying for the DTC can seem daunting, you don’t have to go through it alone. At True North Disability Services, we’re committed to helping you navigate the complexities of the DTC application process, and to make sure you have the best chance at approval. To learn more or schedule a consultation, visit us at www.tnds.ca or call 1-866-883-9681.

The financial relief offered by the DTC can make a significant difference in your financial well-being, so don’t hesitate to explore your options today.

About Carroll Meilleur, Business Development Manager, True North Disability Services

After 25 years in Dentistry, it was time for a change. I was thrilled to find True North Disability Services as their values aligned perfectly with mine, and the last 8 years have flown by!

During my time here, I started as a Case Representative, working with doctors on the applications for our clients. Then I moved into the role of Manager of our Case Representative and Client Service Representative (CSR) Teams. As the company grew, we restructured, and I led just the growing CSR team for the last few years and did the training for our new staff. I have worked in the Business Development role for almost year now, I am proud to contribute to our mission of bringing awareness to the Disability Tax Credit (DTC) and letting people know there are organizations like ours who will support and advocate for them in this application process.

On a personal note, I recently, I moved to Kelowna, BC with my fiancé, where I’m enjoying the natural beauty of the Okanagan. Outside of work, I love spending time kayaking on the region’s lakes and exploring the many hiking trails the area has to offer.

Additional Resources

True North Disability inquiry form

CRA’s Benefit Finder (an excellent resource to discover other programs available through the Canada Revenue Agency)

What is a Registered Disability Savings Plan?

The Disability Tax Credit

If you need to request your medical records, or if you change doctors:

Carroll Meilleur
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