presented by Susan McInnes, CPA, CGA
Top tax issues
 Disability tax credit
 Medical expenses
 What happens to your assets when you die
Disability tax credit
How to claim
 Form can be found online at www.cra-arc.gc.ca
 Must be filled out by doctor and signed by both doctor
and individual applying
 Submit to Canada Revenue Agency (CRA) for approval
Benefits
 Provides a tax credit of $7,899 – refund between $1300
-$1500
 Transferable to spouse if entire credit is not required
 Credit can be applied to past years if doctor indicates
impairment began in the past
Criteria
 Mental or physical impairment which impacts basic
daily activities
 Impairment has to have lasted or be expected to last 12
continuous months
 If you are unclear if you are eligible – talk to your
doctor and apply
Medical expenses
 Must be greater than 3% of net income
 Expenses are combined between spouses
 Can be claimed for any 12 month period that ends in
the taxation year
Travel medical
 Travel over 40 km one way – claim $0.49 per km
 Travel over 80 km one way – same rate – meals and
hotels are also claimable
 Simplified or detailed method can be used – either
keep receipts or keep a log of appointments
Receipts to keep
 Debit slips alone are not acceptable receipts
 Appointment cards or appointment letter from doctor
are acceptable for travel
Refundable medical expense
supplement
 Maximum supplement is $1,172 or 25% of medical
expense if income is between $3,421 - $25,939
 Income must be employment income – pension
income doesn’t qualify
 Completely refundable amount, even if no taxes are
payable
Attendant care/Nursing home
 Retirement homes and Assisted living homes are
considered separate by CRA.
 Nursing Care you receive in a Retirement home or
Assisted living facility can be a medical expense
Nursing home
 Offers 24 hour care to patients
 All regular fees qualify as an eligible medical expense
 Must qualify for the disability tax credit or have other
certification from the doctor
 Additional attendant fees – up to $10,000 eligible of
the salaries paid - $20,000 in the year of death
Attendant care
 Care provided by an attendant who performs personal
tasks that the patient is unable to do
 May include meal preparation, cleaning services,
transportation
 Companionship is also a service
Retirement home
 Does not provide 24 hour care to patients
 Attendant care is an eligible medical expense if
itemized on invoice
 Attendant care is limited to $10,000 per year, or
$20,000 in the year of death
Attendant care or DTC??
 Where remuneration for attendant care is claimed the
disability tax credit may not be claimed
 However, an exception exists, where the attendant care
expense is limited and the DTC may be claimed
 Needs to be determined based on individual
circumstances
What happens when you die
 All assets will roll over automatically to surviving
spouse unless an election is filed
 Rollovers occur at original cost – any capital gains will
be deferred until surviving spouse dies
 All assets – including RRSPs – are deemed disposed of
on the date of death
Principal residence
 Capital gains do not apply
 Deemed disposed of upon death
 Will transfer to the trust at the value on the date of
death
 Capital gain is based on any increase in value of the
property
TFSA
 Tax free savings account is not taxable upon death
 Disbursement will go straight to named beneficiary in
the TFSA
 Spouse or common law partner can be named as
successor holder – keeping the tax exempt status
 Any increase in the TFSA balance between date of
death and payout is taxable to the beneficiary
RRSP & RRIF
 Deemed disposed of at the time of death
 Will roll over to surviving spouse
 Taxable on the date of death
 Will transfer to the named beneficiary – does not
become part of the estate
RESP
 No tax implications upon death
 Become part of estate
 Treatment should be stated in will