SNiPS – Tax Credits for Caregivers

Here are parts of a recent column in the Globe & Mail written by Clare O’Hara.

More than 85 per cent of Canadian family Caregivers are leaving money on the table in possible tax breaks that could ease their related financial burden.

One-third of Canadians currently provide caregiving support or expect to in the next five years – a number that increases to 40 per cent among those aged 45 to 55, according to a recent Canadian Imperial Bank of Commerce poll released recently.

Yet, despite several tax credits available for those Canadians who financially contribute to the care of a loved one owing to illness or advanced age, 43 per cent of caregivers stated they are not aware they exist, and only 12 per cent have ever used them.

Several tax credits should be considered to help offset the financial costs of care and include:

Credit for Caregivers

If you provide support to certain family members with a physical or mental infirmity you may qualify for tax assistance in the form of a tax credit. In some instances, the tax credit can be shared by multiple caregivers who support the same individual. Eligible family members include caring for your spouse, common-law partner, child, parent, sibling or aunt and uncle.

Disability Tax Credit

The Disability Tax Credit (DTC) designed to offset the extra living costs related to having a disability, the disability tax credit is a non-refundable credit used to reduce your taxes owed. In order to qualify, you or a a dependent must have a serious and prolonged physical or mental impairment. Depending on the situation, you may be able to claim this credit for yourself, or on behalf of a dependent, spouse, common-law partner, child or parent.
To apply for the credit, either the person with the disability or a legal representative must fill out Part A of Form T2201.
For example, if you are applying for the DTC on behalf of your child, you may act as the legal representative and fill out Part A of the form.
A medical practitioner is required to fill out Part B of the form. Depending on the type of impairment, a medical doctor, optometrist, audiologist, occupational therapist, psychologist, or speech-language pathologist may complete this portion. When the form is completed, it needs to be mailed to your nearest tax centre.

Home Accessibility Tax Credit (HATC)

Renovations that make homes safer or more accessible for seniors or the disabled may qualify for this tax credit. If you are a senior or hold a valid disability tax certificate or are supporting a qualifying individual, up to $10,000 in expenses can be claimed.

Who Qualifies?

Qualified individuals may claim this credit directly. Seniors aged 65 years or older, as well as taxpayers who hold a valid DTC are considered qualified. If you are supporting someone who qualifies directly, you may be entitled to claim this credit on his/her behalf. If you claim the amount for an eligible dependant, caregiver amount or amount for infirm dependants age 18 or older for the qualifying person, you may be eligible. For example, imagine your elderly father resides with you and you spend $10,000 installing a wheelchair ramp to make your home more accessible. If you are eligible to claim the caregiver amount for your father, you may claim the ramp expense on your tax return.

What Expenses Qualify?

Generally if the qualifying renovation allows better accessibility or improves safety, and is permanent it is eligible. Examples of qualified renovations include Grab bars and hand rails Walk-in tubs or wheel-in showers Widening doorways for wheelchair accessibility Lowering cabinets Ineligible expenses include Household appliances or home-entertainment devices Routine maintenance

If you would like more details relative to your own specific situation please do not hesitate to let me know.

Best,

Larry Smithers
Smithers Group/LGC Smithers Inc
89 King Street West
Dundas, Ontario
L9H 1v1
Email: info@lgc-smithers.com
http://smithersgroup.ca
https://lgc-smithers.com

 

LGC Smithers and Associates are Accounting, Book Keeping, Payroll & Income Tax Specialists based in Dundas, Ontario.   We serve businesses in the greater Hamilton area and offer expert tax advice.  Contact us today to discuss how we can help with your financial needs at 905-627-2910.