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 if they were paid within 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 if they were paid within 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 $2,302 for 2018 ($2,268 for 2017) 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 Quebec 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 Quebec Medical Expense Tax Credit.The medical expenses that can be claimed for Ontario are the same as those for the Federal tax credit, except
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.
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 (financially - i.e., you are paying medical expenses on their behalf), and who is
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 $2,302 for 2018 ($2,268 for 2017) 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 was removed for 2011 for all provinces and territories except Ontario, BC, and Northwest Territories. It was 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, adult child who is still a student, 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- Income Tax Folio S1-F1-C1, Medical Expense Tax Credit
- Income Tax Folio S1-F1-C3, Disability Supports Deduction
- Form T2201, disability tax credit certificate>
Revised: September 13, 2018
Copyright © 2002 Boat Harbour Investments Ltd. All Rights Reserved. See Reproduction of information from TaxTips.ca