Tax Tips for People with Parkinson's | Parkinson Society British Columbia

Suite 600 - 890 West Pender Street

Vancouver, BC V6C 1J9

www.parkinson.bc.ca

Tax Tips for People with Parkinson's

The following is information on tax credits and rebates that may be relevant to a person with Parkinson's disease (PD). Each individual's situation is different and this Help Sheet is a general guide only. The information is current as of 2011 but taxation laws change occasionally. Please contact a financial advisor or an accountant for advice pertaining to your situation.

Disability Tax Credit

The Disability Tax Credit (DTC) is a non-refundable tax credit that a person with a disability may be able to claim on annual income tax returns. This is an important tax credit to investigate because in 2010 the deduction was $7,239.

A person with Parkinson's can qualify for the DTC. The definition of "disability" used in the application encompasses physical and mental health together with all aspects of daily living. In the very early stages of PD, when you may be employed and/or coping well on your own, you likely would not qualify. As PD progresses, however, there is a greater chance of a successful application. In addition, the impact of any other medical conditions on your day to day living can be taken into consideration, along with the impact of Parkinson's.

To qualify for the DTC, a lengthy application must be completed and the majority of the information will be provided by your physician. For you to qualify your disability must be of a prolonged nature and it must restrict your basic activities of daily living. Sometimes initial applications are denied and reapplication or appeal is required. Your family physician can provide you with advice and guidance when applying for the DTC.

Please note that you may not qualify for the DTC even if you have qualified for the 'Persons with Disabilities' designation or for Canada Pension Plan Disability Benefits. In addition, if you qualify for the DTC, Canada Revenue Agency (CRA) can ask you to re-apply in the future and/or may decide you are no longer eligible.

It is important to know that if you do not have a taxable income and are, therefore, unable to use the DTC, it can be transferred to a spouse or other supporting individual. To qualify for the transferred DTC, this individual must reside with you.

If you qualify for the DTC and could have claimed it in the past but did not, you may re-submit prior tax returns for adjustment.

To obtain a copy of the application (form number T2201) please download it from the CRA website or call 1 800 959 2221.

Medical Expense Tax Credit

This tax credit is available for medical expenses prescribed by a doctor. A claim must be supported by original receipts and must be attached to your tax return for the taxation year in which the purchases were made. If you have private insurance, you must deduct the reimbursement you have received from your insurer prior to submitting the balance of the costs with your tax return. If you pay a deductible on your private insurance, that amount, plus the monthly premiums you pay for the insurance (with the exception of MSP), together with the non-reimbursed portions of the expenses, can be claimed.

Certain medically necessary home renovations that do not enhance the value of a house are eligible expenses. Please see our Help Sheet: Assistive Devices and Home Adaptations and Funding for more information on ensuring such expenses qualify under this tax credit program or call Parkinson Society British Columbia 1 800 668 3330 or 604 662 3240.

A complete list of expenses eligible for the Medical Expense Tax Credit is available on the Canada Revenue Agency website (enter Medical Expense Tax Credit in the search box near the top of the page) or call 1 800 959 8281.

Disability Fuel Tax Rebate

If a physician has determined that it is unsafe for you to use public transit and you must, therefore, rely on an automobile, you may qualify for the Disability Fuel Tax Rebate. This program gives a refund of Provincial fuel tax paid on gasoline, diesel or propane purchased for a vehicle.

To qualify for the Provincial rebate program, you must complete form number FIN 119 - Application for the Fuel Tax Refund Program for Persons with Disabilities. This application, together with information on eligibility and registration, can be found on the British Columbia Ministry of Finance website or call 1 877 388 4440.

Note: If you qualify for the Disability Fuel Tax Rebate you may also qualify for a discount on your automobile insurance. When accepted into the fuel tax rebate program, you will receive a letter certifying that you are registered. You may request a discount on your automobile insurance, at the time of renewal, by presenting this letter to your insurer.

HST (or GST/PST) Rebate

This program allows you to apply for a rebate of the HST (or GST/PST) you paid on expenses such as Meals on Wheels, medical devices or supplies, vehicle modifications, certain recreational services and personal care. Please see the Canada Revenue Agency website for a list of eligible services and expenses. Click on Persons with Disabilities on the lower left side, then click GST/HST information on the right side of the next page, or call 1 800 959 1953.

Attendant Care Expenses

Attendant care expenses can be claimed if the costs are paid to an attendant who is not the taxpayer's spouse or common-law partner and who was 18 years old when the payments were made. For more information on claiming this expense please see pages 15 - 19 on the Canada Revenue Agency website or call 1 800 959 8281.

Caregiver Amount Tax Credit

If at any time in the taxation year you maintained a dwelling and your dependent or a dependent of your spouse or common-law partner lived with you, you may be eligible to claim the Caregiver Amount tax credit. The dependant(s) must be 18 years of age or older and be dependent on you due to an impairment in physical or mental health. In the case of a dependent parent or grandparent, they must be 65 years of age or older.

In addition, if you are eligible to claim the caregiver amount for a dependent relative, and if the dependant meets the criteria for the Disability Tax Credit (DTC), any unused portion of the DTC may be transferable to you. For further information please see the Canada Revenue Agency website, click on Persons with Disabilities on the lower left side, then click on what can persons with disabilities claim as a deduction or credit? or call 1 800 959 8281.

Other Programs

You may also qualify for these programs:

Home Buyer's Tax Credit

You can claim an amount of $5,000 for the Home Buyer's Tax Credit (HBTC) if both of the following apply:

1) you or your spouse or common-law partner acquired a qualifying home

2) you did not live in another home owned by you or your spouse or common-law partner in the year of acquisition or in any of the four preceding years (first-time home buyer)

Please go to the Canada Revenue Agency website and enter Home Buyer's Tax Credit in the search box.

HST (or PST/GST) Tax Credit

The HST (or PST/GST) credit is a tax-free quarterly payment that helps individuals and families with low and modest incomes offset all or part of the tax that they pay. For more information please go to the Canada Revenue Agency website.

Disability Supports Deduction

If you have a physical or cognitive impairment you may be able to deduct the expenses that you incurred in the year in order to work, go to school, or do research for which you received a grant. Please note that you are not eligible for this deduction if you have already claimed these expenses under the Medical Expense Tax Credit program. For more information please go to the Canada Revenue Agency website and enter Disability Supports Deduction in the search box near the top of the page or call 1 800 959 8281.

Refundable Medical Expense Supplement

You may be able to claim a credit of up to $1,074 (for 2010) if all of the following apply:

1) you have an amount on line 215 of your return or on line 332 of Schedule 1

2) you were resident in Canada throughout 2010

3) you were 18 years of age or older at the end of 2010

For more information please go to the Canada Revenue Agency website and enter Refundable Medical Expense Supplement in the search box near the top of the page.

Registered Disability Savings Plan

This is a savings plan that is intended to help individuals save for the long-term financial security of a person who is eligible for the Disability Tax Credit (disability amount). Similar to RRSP plans, an RDSP is a tax-deferred savings plan. Contributions can be made until the end of the year in which the beneficiary turns 59 years of age. For more information please go to the Canada Revenue Agency website and click on Persons with Disabilities on the lower left side.

Working Income Tax Benefit (WITB)

The working income tax benefit (WITB) is a federal refundable tax credit for low-income individuals or families with an annual working income over $3,000. This tax benefit consists of a basic amount and a disability supplement. Complete Schedule 6 to calculate the basic WITB and, if applicable, the WITB disability supplement to which you may be entitled. For more information please go to the Canada Revenue Agency website and enter Working Income Tax Benefit in the search box.