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Canada Revenue Agency Contemplating Regulations That May Threaten Access to the Canadian Disability Tax Credit

  • Synopsis: Published: 2016-12-15 - CRA regulations could potentially close the door on the 500,000 eligible Canadians who find the DTC application process so complicated that they are unable to receive it. For further information pertaining to this article contact: The Association of Canadian Disability Benefit Professionals at acdbp.com.
Canadian Disability Tax Credit

The Disability Tax Credit (DTC) is a non-refundable tax credit in Canada for individuals who have a severe and prolonged impairment in physical or mental function - An impairment qualifies as prolonged if it is expected to or has lasted at least 12 months. To qualify, a person must be markedly restricted in at least one of the following categories: speaking, hearing, walking, elimination (bowel or bladder functions), feeding, dressing, performing mental functions of everyday life, life-sustaining therapy to support vital function and cumulative effects of significant restrictions. The degree of disability must be approved by Canada Revenue Agency, and this process requires the completion and submission of the T2201 Disability Tax Credit Certificate form.

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Quote: "How is this private member's bill so out of touch with the differently-abled community, the 50,000 Canadians who have been helped by advocates and the 500,000 who still need help?"

Cheryl Gallant's ill thought out private member's bill threatens to pull the rug out from beneath the half million eligible Canadians still not receiving the disability tax credit.

Half a million eligible Canadians have not been receiving the federal Disability Tax Credit; many have been missing out for over ten years. For a family who has a child with special needs, this could be up to $50,000 that they should have been able to rely on for helping with their disability.

The previous Conservative government passed Cheryl Gallant`s private member's bill (C-462) in 2014. This bill had serious flaws, including that it passed without regulations. The Canada Revenue Agency (CRA) was charged with creating these regulations, including creating a fee cap for professional disability tax credit advisors, which is out of their realm of experience. Regulations will likely be announced before the end of 2016.

These regulations could potentially close the door on the 500,000 eligible Canadians who find the DTC application process so complicated that they are unable to receive it. Many people with disabilities, including their caregivers, do not even know about the DTC or submit applications that are inexplicably denied.

Every year, the CRA is sitting on a billion dollars that does not reach eligible Canadians.

"The ins-and-outs of navigating our tax system is complicated for everyone, and is even more challenging for those who live with a disability. This is why Section 15 of the Taxpayer Bill of Rights states that individuals in Canada have the right to be represented by a person of their choice", says Rob Gilmour, Executive Director of the Association of Canadian Disability Benefit Professionals.

"If the CRA puts a fee cap below 30 per cent, it will shut down professionals from helping those in need. These same professionals have already filled a huge gap by spending millions of dollars on awareness, by providing professional tax advice, and by staying with a case all the way through the appeals process to ensure families get the financial relief they need, deserve, and qualify for", states Gilmour.

The Association has been self-regulated for over 2 years and operates on a success-based model. No fee is charged until a client successfully receives their money. Only then is up to a 30 per cent fee earned, which is the standard across all industries for work that involves 12 months of effort navigating CRA's administrative processes.

One successful case involved 70 pages of case work and 656 phone calls before finally being approved. These numbers should not surprise anyone who has ever dealt with the CRA.

One such company, The National Benefit Authority (NBA), has 100 full-time staff and has single handedly helped over 40,000 Canadians go back up to ten years. These Canadians went up to ten years without anyone helping them.

"We have a 66 per cent success rate of getting previously rejected applications approved", says Akiva Medjuck, founder of The NBA. "Support for tens of thousands of differently-abled Canadians will be eliminated if these regulations are allowed to be set at below 30 per cent."

When it comes to the Disability Tax Credit, Paul Rosen, a Canadian hero, is a strong advocate for Canada's disabled community. Rosen, three-time Paralympian and gold medalist, whose leg was amputated in 1999, is a successful client of a disability tax credit professional. "How is this private member's bill so out of touch with the differently-abled community, the 50,000 Canadians who have been helped by advocates and the 500,000 who still need help?"

The Disability Tax Credit was expanded by the federal Liberal government in 2000. They also made the DTC available to those with disabilities dating back 10 years and allowed it to be transferrable to family members.

It is estimated that nearly 4.2 million Canadians have some sort of long-term disability, and many of them have increased financial obligations as a result. Cost of living for the disabled is notably higher than Canadians without disabilities.

"People with disabilities and their families already manage a lot in life. Shutting down these Disability Tax Credit support teams, it's not right. It's just not right", says Rosen.

The Association of Canadian Disability Benefit Professionals has 12 founding members across Canada who specialize in all processes involved in applying for The Disability Tax Credit. The Association is committed to helping the 500,000 Canadians who should be receiving The Disability Tax Credit, but are not!

Related Information:

  1. Why are Neediest Disabled Canadians Receiving Least Benefit - Report provides evidence of limitations of the Canada disability tax credit and presents potential reforms which would raise their incomes 27% - The School of Public Policy - University of Calgary
  2. Disability and First Home Buyers Tax Credit - Canada - Information on Disability and the Canadian First Home Buyers Tax Credit (HBTC) - Canada Revenue Agency
  3. Tax Tips for Canadian Families - Benefits credits and services to help families reduce the amount they owe at tax time and provide them with convenient online options - Canada Revenue Agency




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