Its that time of year again…tax time! Here in Canada, it is also the time that many people living with diabetes learn that they could be eligible for the Disability Tax Credit (DTC). Here are a few frequently asked questions about the Disability Tax Credit that will hopefully help you as you decide if you or your loved one qualifies…
Does everyone with diabetes qualify?
No. In order to qualify for the DTC you must use multiple daily injections of insulin via syringe or insulin pump and be intensively managing your diabetes care.
What does intensively managing your diabetes care mean?
You must be testing, injecting, logging, and adjusting your insulin doses. These tasks must take you over 14 hours per week to perform.
Do children with diabetes qualify for the Disability Tax Credit?
Yes, children under 18 qualify without having to prove the 14 hours. CRA assumes that the amount spent on diabetes care by both the parent and child would combine to be over 14 hours per week and therefore a diagnosis signed by the doctor on the T2201 is all that is required for their approval.
What is the Disabled Child Benefit?
This is a separate amount that can be given to you for your child if your child is eligible for the DTC and you are receiving a Child Tax Benefit.
What is a T2201?
The T2201 is the form created by CRA that must be filled out by the person with diabetes and their doctor in order to qualify for the disability tax credit.
I am not disabled! I don’t want to be labeled disabled. Why do I want to fill out this credit?
The Disability Tax Credit, when applied to people with diabetes, is not about being disabled. A person with diabetes does not qualify based on a disability. They qualify based on the clause for people who require “Life-sustaining therapy”. This subsection is for people who spend an inordinate amount of time on the therapy that they require to live.
I have read that I can’t use the amount of time that I spend counting carbohydrates. Why not?
CRA feels that over time things like counting carbs become second nature to a person with diabetes and therefore no longer takes an inordinate amount of their time.
I have to exercise because of my diabetes. Can I count the time I spend at that the gym?
No. Everyone should be exercising and while there are added benefits for a person with diabetes, this is not an activity that will be allowed on your application.
What tasks can I include in my application?
The Diabetes Advocacy website includes a comprehensive list of what sort of tasks are allowed and a guide of how much time it takes to perform them each day, as well as more questions answered about the Disability Tax Credit.
Do I need to send Canada Revenue Agency my logbook?
There is no need. CRA simply wants to see the tasks that you do each week with a specific breakdown of how much time those tasks take. Your doctor, however, may ask that you keep track of what you are doing for a period of time and bring it to him/her before they will sign off on the T2201 for you.
Who can sign the T2201?
A medical doctor must sign this form. This can be your family doctor, pediatrician, internist or endocrinologist. Choose the person with the most knowledge of your care and understanding of what they are signing. Their support is vital to a successful application.
Do I need to pay someone to fill out the T2201?
No. There is no reason to pay a fee or a percentage of your return to have this credit filled for you. Diabetes Advocacy does offer a service to assist in filling the forms for those who are not comfortable in doing this themselves. I also have created a four–step course that guides you through filling the forms yourself.
Can I only apply for the disability tax credit when I file my taxes?
No, you don’t have to wait until you file your tax return to make a DTC application. You can fill out the T2201 at any time and ask for the Canadian Revenue to reassess your taxes for years back to your diagnosis or 10 years, whichever is first.
Take our short DTC quiz to see if you might qualify.