Sleep apnea can seriously affect daily life and long-term health. In Canada, individuals with this condition may qualify for financial support through the Disability Tax Credit (DTC). This non-refundable tax credit helps offset costs for severe and prolonged impairments, including those caused by sleep apnea. Below is a guide to eligibility, the application process, and benefits.
Eligibility Criteria for Sleep Apnea
To qualify for the DTC, sleep apnea must cause a severe and prolonged impairment that meets one of these conditions:
- Marked Restriction – The condition significantly limits one or more basic daily activities (e.g., mental functions, dressing, walking) at least 90% of the time, even with treatment.
- Life-Sustaining Therapy – Requires therapy (e.g., CPAP machine) for at least 14 hours per week to sustain vital functions.
- Cumulative Effect – Combined effects of multiple impairments (e.g., severe fatigue and physical exhaustion) create significant limitations.
A medical practitioner must certify the impairment using Form T2201. Eligibility depends on how sleep apnea affects daily life, not just the diagnosis itself.
How to Apply for the DTC
The application process has three main steps:
- Complete Part A of Form T2201 – Provide personal details and authorize the Canada Revenue Agency (CRA) to contact your medical practitioner.
- Medical Certification (Part B) – A doctor, nurse practitioner, or specialist (e.g., respiratory therapist) must confirm how sleep apnea restricts daily activities or requires life-sustaining therapy.
- Submit the Form – Apply online via the CRA portal or mail it in. Processing takes about 8 weeks, though delays may occur.
⚠️ Avoid Third-Party Services – Some companies charge high fees to assist with applications, but you can apply directly through the CRA for free.
Financial Benefits
- Federal Credit – Up to $9,872 annually (2024 amount).
- Retroactive Claims – Refunds for up to 10 previous years if approved.
- Provincial Credits – Additional amounts vary by province (e.g., Ontario offers around $5,000).
A 10-year retroactive claim could provide over $40,000 in combined federal and provincial credits.
Additional Benefits
Approval for the DTC also grants access to:
- Registered Disability Savings Plan (RDSP) – A government-matched savings program for long-term financial security.
- Canada Disability Benefit (CDB) – Monthly payments for low-income individuals (up to $2,400 annually starting July 2025).
- Child Disability Benefit – Tax-free monthly support for caregivers of children with severe impairments.
Challenges and Tips
- Documentation – Include sleep study results, CPAP usage logs, and physician notes to strengthen your application.
- Appeals – If denied, you can request a CRA review or submit additional medical evidence.
- Medical Fees – Costs for completing Form T2201 may be claimed as medical expenses.
Health Risks of Untreated Sleep Apnea
If left untreated, sleep apnea increases the risk of:
- Heart disease, stroke, and diabetes
- Daytime fatigue leading to workplace or driving accidents
Sleep apnea affects both health and quality of life. The DTC helps reduce financial strain, making treatment more accessible. If you think you qualify, consult a tax professional or visit the CRA website for details.