DEFINITION: Disability Tax Credit (DTC) is a non-refundable tax credit available in Canada to individuals with disabilities or those who support them. It is designed to provide financial relief to those who have a prolonged impairment that affects one or more of their basic life activities.
FAQs:
1. What disabilities qualify for the Disability Tax Credit in Canada?
To qualify for the Disability Tax Credit, the disability must significantly restrict an individual’s ability to perform one or more basic life activities, such as walking, speaking, hearing, seeing, or feeding oneself. Examples of qualifying disabilities include, but are not limited to, multiple sclerosis, ADHD, autism, and bipolar disorder.
2. Is each disability evaluated individually for the Disability Tax Credit?
No, the Disability Tax Credit is not specific to any particular disability. Instead, the focus is on the impact of the disability on the individual’s ability to perform basic life activities. The eligibility depends on the severity and duration of the impairment, rather than the specific diagnosis.
3. Can mental health conditions qualify for the Disability Tax Credit?
Yes, mental health conditions can qualify for the Disability Tax Credit if they significantly restrict the individual’s ability to perform basic life activities. Conditions such as depression, anxiety disorders, and schizophrenia may be considered if they meet the required criteria.
4. Can temporary disabilities be eligible for the Disability Tax Credit?
No, the Disability Tax Credit is intended for individuals with prolonged impairments that are expected to last for at least 12 months. Temporary disabilities or short-term illnesses typically do not meet the criteria for the credit.
5. Do I need to be receiving government benefits to be eligible for the Disability Tax Credit?
No, you do not need to be receiving government benefits to qualify for the Disability Tax Credit. Eligibility is based on the impact of your disability on basic life activities, rather than your current receipt of benefits or support.
6. Can children with disabilities qualify for the Disability Tax Credit?
Yes, children with disabilities can qualify for the Disability Tax Credit if their impairment significantly restricts their ability to perform basic life activities. The credit can be claimed by the child’s parent or legal guardian.
7. How do I apply for the Disability Tax Credit in Canada?
To apply for the Disability Tax Credit, you need to complete Form T2201 – Disability Tax Credit Certificate and have it certified by a qualified medical practitioner. The completed form should then be submitted to the Canada Revenue Agency (CRA) for assessment and approval.