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Medical Expense Tax Credit

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Filing Your Return -> Medical Expense Tax Credit

Medical expense tax credit Line 330, Provincial Line 5868

Income Tax Act s. 118.2(1)

A taxpayer can claim a non-refundable tax credit for medical expenses paid by the taxpayer or the taxpayer's spouse or common-law partner.  The medical expenses claimable include those paid for the taxpayer, the taxpayer's spouse or common-law partner, or a child under 18 of the taxpayer or spouse, who is dependent on the taxpayer or spouse for support.

There is a separate calculation for the medical expense tax credit for other eligible dependents.

Medical expenses can be claimed for any 12 month period ending in the current tax year, and not claimed in the prior tax year.  The federal and provincial medical expenses claimed must be claimed for the same time period.  When medical expenses are being claimed for a deceased person (either dependent or other eligible dependent), they may be claimed for any 24 month period including the date of the person's death (and not claimed in a prior year).  In order to claim all medical expenses for 24 months in the year of death, the tax return for the prior year could be revised so that no medical expenses are claimed, leaving them available for the year of death.  To do this, a T1Adj must be filed.    See the article on changing your tax return.

Generally, all eligible medical expenses can be claimed, even if they were incurred outside of Canada.  When medical expenses are reimbursed by an insurance plan, only the portion not reimbursed can be claimed.

Medical expenses for the taxpayer, the taxpayer's spouse or common-law partner, and dependent children under 18 are claimed on line 330 of the federal tax return.  Only expenses in excess of the lesser of $2,152 for 2013 ($2,171 for 2014) or 3% of net income can be claimed for the federal tax credit.  The lowest tax rate is applied to the medical expenses to determine the amount of the tax credit.

All provinces except Ontario and Québec use the Federal medical expense total to calculate the provincial medical expense tax credit, but the base amount threshold is different from the Federal for most provinces.  See the tables of non-refundable tax credits for the base amounts and applicable tax credit rates for each province.  See Québec Medical Expense Tax Credit.

The medical expenses that can be claimed for Ontario are the same as those for the Federal tax credit, except
bullet the maximum Ontario claim for attendant care expenses for 2013 is $13,239 ($26,479 in the year of death, $13,371 and $26,744 for 2014).  There is no Federal limit unless the disability tax credit is being claimed.
bullet the maximum Ontario claim for the cost of a van adapted for transporting a patient who requires the use of a wheelchair for 2013 is $6,620 ($6,686 for 2014).  Federal limit is $5,000; and
bullet the maximum Ontario claim for moving expenses for a patient's move to a more accessible dwelling for 2013 is $2,648 ($2,674 for 2014).  Federal limit is $2,000.

Note that the medical expense tax credit (as well as the age amount tax credit) can be reduced by capital gains, even if the capital gains are offset by capital losses carried forward.  This is because the tax credit is based on line 236 of the tax return, net income for tax purposes.  Losses carried forward are deducted after this on the tax return.  See our article on how to calculate Total Income For Tax Purposes, Net Income For Tax Purposes, and Taxable Income.

Medical expenses for other eligible dependants Line 331, Provincial Line 5872

Income Tax Act s. 118.2(1)D

Medical expenses may be claimed for amounts paid on behalf of a person who is dependent on the taxpayer for support, and who is 

bullet the child over 17, or the grandchild, of the taxpayer or the taxpayer's spouse or common-law partner; or
bullet the parent, grandparent, brother, sister, uncle, aunt, niece or nephew (if resident in Canada at any time in the year) of the taxpayer or of the taxpayer's spouse or common-law partner

Medical expenses for other eligible dependants are claimed on line 331 of the federal tax return.  A separate calculation is done for each dependant.  Only expenses in excess of the lesser of $2,152 for 2013 ($2,171 for 2014) or 3% of net income of the dependant can be claimed for the federal tax credit.  The lowest tax rate is applied to the medical expenses to determine the amount of the tax credit.  The 2011 Federal Budget removed the cap of $10,000 beginning in the 2011 taxation year.

The provincial maximum allowable medical expenses for other eligible dependants has been removed for 2011 for all provinces and territories except Ontario, BC, and Northwest Territories.  It is removed for 2012 for BC.  See the tables of non-refundable tax credits for the tax rates applicable to calculate the tax credit, and to see which provinces have a limit on the amount that can be claimed for each dependant.

If more than one person supports the dependant, each supporting person can claim up to the maximum, where a maximum exists, as long as the total claimed by all supporting persons does not exceed the total medical costs for the dependant.  This would make it advantageous to share high medical costs (such as nursing home costs) among supporting persons.  For example, the supporting persons could be husband and wife supporting a parent or grandparent or adult infirm 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.

Canada Revenue Agency (CRA) Resources

bullet

Income Tax Folio S1-F1-C1, Medical Expense Tax Credit

bullet

Income Tax Folio S1-F1-C3, Disability Supports Deduction

bullet

RC4064 - Medical and Disability-related Information

bullet

Form T2201, disability tax credit certificate

See also:

Persons with disabilities - links to all information on TaxTips.ca

Tax Tips:

Split high medical costs for other eligible dependants among supporting persons in order to maximize the tax credit received.

You may be eligible for the refundable medical expense supplement.

When claiming medical expenses for a deceased person, it may help to adjust the prior year tax return to remove medical expenses regarding that person, and claim them on the year of death tax return.

 

Revised: February 22, 2014

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