Line 215 or Line 330 Attendant Care Expenses
Income Tax Act s. 64, s. 118.2
Attendant care expenses can only be claimed for amounts paid to an attendant who was not the taxpayer's spouse or common-law partner, and who was at least 18 years old when the payments were made. Attendant care costs can be claimed for persons who are eligible for the disability amount (see the article on disability amount tax credit), and in some situations for persons who do not qualify for the disability amount.
You can claim attendant care costs for amounts paid, by you or your spouse or common-law partner, for the care of
Attendant care costs for other eligible dependents are claimed as medical expenses, and are subject to the federal and provincial/territorial limits for medical expenses for other eligible dependents.
If attendant care expenses are paid to an individual, your receipt must include their social insurance number. The individual will either be a self-employed contractor, or your employee. If the individual is an employee, you will be required to deduct from their pay and remit income tax, CPP contributions, and EI premiums. You will also have to pay the employer portion of CPP contributions and EI premiums, which would be part of your total attendant care costs. The amounts that you pay to an employee are subject to the rules for minimum wages rates and other employment standards for your province or territory. To determine whether the person is an employee or a contractor, see our article on employee vs self-employed contractor.
When a person does not qualify for the disability amount, in order for attendant care costs to be claimed, a medical practitioner must certify in writing that the person needs a full-time attendant due to mental or physical infirmity and will likely continue to be dependent on others for the long term. Attendant care can be claimed as part of the medical expense tax credit on line 330 for:
For persons who qualify for the disability amount, attendant care expenses may be claimed for:
A 2007 Tax Court of Canada case, Zaffino v. the Queen, results in the taxpayer being allowed to claim house cleaning services as part time attendant care under s. 118.2(2)(b.1) of the Income Tax Act. Other tasks which could qualify as attendant care include:
The attendant care expenses of the disabled person can be claimed either:
The attendant care costs can also be split between the disability supports deduction and medical expenses.
Individuals who have incurred attendant care expenses in order to be employed or self-employed, go to school or conduct research, can claim these costs on line 215 of the personal tax return as part of the disability supports deduction, as a reduction of income. This is better than claiming these costs as a medical expense, because medical expenses are reduced by the lesser of $2,237 (federally, for 2016, $2,208 for 2015) or 3% of net income in order to calculate the tax credit. The medical expense tax credit is always at the lowest tax rate (except in Quebec), but a reduction of income would save tax at the person's marginal tax rate.
For other individuals who are eligible for the disability amount, attendant care expenses are claimable as a medical expense. The expenses can be claimed by the individual, or by one or more supporting relatives who have paid the expenses. This claim is also available for seniors who are in a retirement home and are eligible for the disability amount. For more information on what type of attendant care costs are claimable, see our article on attendant care expenses paid to a retirement home. When the disability amount is being claimed, the maximum amount that can be claimed federally for attendant care costs as medical expenses is $10,000 ($20,000 in the year of death). In Ontario the maximum amount that can be claimed for attendant care costs as medical expenses for 2017 is $14,066 ($28,130 in the year of death, $13,844 and $27,687 for 2016), when the disability amount is being claimed. There is no limit federally or in Ontario if the disability amount is not being claimed, as long as the individual is eligible for the disability amount. Other provinces, except Quebec, use the same amount for medical expenses as the Federal amount.
Person Who Qualifies for the Disability Amount - Options
There are 2 options available when claiming attendant care expenses as a medical expense for a person who qualifies for the disability amount:
Option 1: Claim the disability tax credit, and claim attendant care expenses as medical expenses, to a maximum of $10,000 per year, and $20,000 in the year of death. Any unused portion of the disability amount can be transferred to a spouse or common-law partner or to another supporting person. The Ontario maximum is as above for 2016, $13,844 per year ($27,278 in the year of death).
Option 2: Do not claim the disability tax credit. In this case there is no maximum for the amount of attendant care expenses that can be claimed as medical expenses. For 2016, the federal disability amount is $8,001 ($7,899 for 2015). Thus, if your total attendant care expenses exceed $18,001 ($10,000 maximum attendant care expenses + $8,001 disability amount), it is better to claim the attendant care expenses as medical expenses and not claim the disability amount. In this case, the disability amount cannot be claimed by the taxpayer, nor can it be transferred to anyone else.
The two options above refer to expenses claimed under s. 118.2(2)(b.1) of the Income Tax Act (ITA), for attendant care provided in
Note that the $10,000 maximum above, and the Ontario maximum, is per paying individual, not per patient. Each supporting person who is entitled to claim a medical expense tax credit for attendant care for a patient under s. 118.2(2)(b.1) may claim up to $10,000. See the Canada Revenue Agency (CRA) technical interpretation 2006-0172181I7 for further details. This makes it advantageous to share high attendant care costs among supporting persons. For example, the supporting persons could be husband and wife supporting a parent or grandparent or adult dependent child, or could be siblings supporting a parent or grandparent. The key is that each supporting person making a claim must have a receipt to support their claim. Keep in mind that when the attendant care costs are claimed for other eligible dependents they are subject to the limits (if any - depends on the province) for medical expenses for other eligible dependents.
Income Tax Act s. 118.2(2)(d)
When the expenses are for full-time care in a nursing home, there is no limit on the total expenses that can be claimed as medical expenses for yourself or your spouse or common-law partner, but the disability tax credit cannot be claimed. When these costs are claimed for other eligible dependents, they are subject to the limits (if any - depends on the province) for medical expenses for other eligible dependents. When claiming expenses for full-time care in a nursing home, either
Income Tax Act s. 118.2(2)(b.2)
Attendant care expenses can be claimed for care or supervision provided in a group home in Canada maintained and operated exclusively for individuals who have a severe and prolonged mental or physical impairment. Form T2201 must be submitted and approved to claim these expenses, and the expenses must not have been claimed as part of a disability supports deduction. The disability tax credit is also available when the group home expenses are claimed. There is no limit on the amount of group home expenses that can be claimed as medical expenses for yourself or your spouse or common-law partner or dependent child under age 18. When these costs are claimed for other eligible dependents, they are subject to the limits (if any - depends on the province) for medical expenses for other eligible dependents.
Canada Revenue Agency (CRA) resources re attendant care expenses
See also - links to all information on TaxTips.ca related to persons with disabilities.
Revised: October 30, 2016
Copyright © 2002 - 2016 Boat Harbour Investments Ltd. All Rights Reserved See Reproduction of information from TaxTips.ca