Good news for disability tax credit applicants

Is there a doctor in the house?

This article is aimed at physicians, optometrists, audiologists, occupational therapists, physiotherapists, psychologists and speech-language pathologists, all of who are considered "qualified practitioners" to certify a person is eligible for the Disability Tax Credit.

Good news is that the Canada Revenue Agency has made huge improvements to its website to help qualified practitioners understand the criteria for the DTC and determine whether the patient might qualify. It almost makes it simple.

In the past, I've had great sympathy for medical practitioners, trying to understand a difficult and complex set of rules and definitions, and then figure out how those might apply to each patient. Unfortunately, this lack of information and understanding has meant there has been unevenness and unfairness in the way DTC applications have been treated.

Hopefully, the new information (and even animated illustrations) CRA has provided will encourage all medical practitioners to take a few minutes to review the website, the qualification criteria and the clear examples, whenever they are approached by a patient who needs the professional's help in completing the T2201 Disability Tax Credit Certificate.

This section of the CRA website is available at www.cra-arc.gc.ca/qualified-practitioners.

CRA has done an excellent job of providing clear definitions and videos with examples of situations that qualify and do not qualify. The section starts out by pointing out to medical practitioners they have a legislative responsibility to complete this form when a patient requests it.

Qualification criteria

Taxpayers who have a physical or mental infirmity are dependent on their qualified practitioner to take the time to understand the nature of their impairment and make a best effort attempt to complete the form accurately, or they have no hope of receiving this tax credit.

The DTC is very important, not just for the significant reduction in income taxes (on up to 10 years in the past), but for the fact it opens the door to a variety of other programs for people with disabilities, including the Registered Disability Savings Plan (RDSP).

The DTC is a tax benefit for people who have a physical or mental affliction that causes impairment in the activities of everyday living. It can be claimed by people who are working full time, which is a point often missed by doctors.

The impairment must affect any one or more of walking, speaking, vision, hearing, dressing, feeding, bladder or bowel function, or involve life-sustaining therapy. As well, a patient may suffer from several relatively minor impairments which, when taken together, cause a person to take an inordinate amount of time (or be unable) to perform any of those functions of everyday living.

The physical or mental impairment must have lasted, or be expected to last, 12 months or longer, and must be severe, such that it restricts the individual all, or substantially all, of the time.

To try to determine if you qualify, read through the criteria on the CRA website, complete the pre-qualification questionnaire on form T2201 or Are You Eligible at www.disabilitytaxservices.ca. This is the website of a private, fee-for-service disability consultant in Richmond, B.C.

Another new and positive initiative by CRA -- at least in the Manitoba region -- is providing a DTC specialist to provide outreach sessions to professional groups.

I strongly encourage the medical professional associations to arrange for such sessions. Drop me a line if you need the name and contact information; I'll be glad to help.

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Thanks to all of you who sent me supportive notes about last week's article, in which we tried to start a campaign to rebrand savings and cash as the most desirable consumer luxury good that a person could possibly own. That gives me great encouragement we could start a significant movement.

You can view that article on the Winnipeg Free Press website or on my blog, at www.davidchristianson.com. Please add your comments and suggestions!

David Christianson is a fee-for-service financial planner and portfolio manager, at Wellington West Total Wealth Management Inc. providing comprehensive financial advice and management. You can email him at dchristianson@wellwest.ca or visit his blog at www.davidchristianson.com.

Republished from the Winnipeg Free Press print edition May 28, 2010 B4