Disability Tax Credit (DTC) in Canada

The Disability Tax Credit (DTC) is a government benefit that helps Canadians with disabilities or their caregivers save money on taxes. It’s a non-refundable tax credit that reduces the amount of income tax you owe.

According to recent government statistics, over 6 million Canadians have a disability that impacts their daily living activities (Source). For these individuals and their families, the costs of medical treatments, assistive devices, home care, specialized transportation, and other disability-related expenses can quickly add up. This is where the Disability Tax Credit aims to help.

Our guide will walk you through everything you need to know about the DTC, including who qualifies, how to apply, and how to get the most out of the benefit.

What is the Disability Tax Credit?

The Disability Tax Credit DTC is a non-refundable tax credit administered by the Canada Revenue Agency (CRA). It is designed to help people with disabilities and their caregiver families reduce the amount of federal and provincial income taxes they have to pay each year.

When we say the DTC is non-refundable, it means that the DTC reduces the amount of income tax you owe on your tax return. If the DTC brings the amount of taxes owed to zero, you will not receive a tax refund on any remaining unused amounts of the credit.

The purpose of DTC is to ease some of the costs associated with living with a severe and prolonged mental or physical disability. While it does not cover all costs, it helps improve an individual’s financial means to deal with disability expenses.

Who Qualifies for the Disability Tax Credit?

To be eligible for the DTC, you must meet the following basic qualifications:

• You must have a valid Social Insurance Number (SIN)
• You need to be a resident of Canada for income tax purposes
• You have a prolonged mental or physical impairment certified by a medical practitioner

The CRA defines a prolonged impairment as one that has lasted or is expected to last for a continuous period of at least 12 months.

It’s important to understand that eligibility isn’t about your specific medical condition or diagnosis. Instead, it’s about how the impairment affects your ability to perform basic, everyday activities. There are three main paths to qualifying for the DTC. Let’s break them down.

You Have “Marked Restriction” in One Basic Activity of Daily Living

This is the most direct path to qualifying. This means that at least one of your basic daily activities is severely impacted by your impairment. The CRA looks at the following activities:

• Walking – ability to walk 100 meters on level ground safely and without severe pain or shortness of breath
• Elimination – the ability to manage bowel and bladder functions
• Dressing – the ability to put on clothing, do up buttons and zippers, and take off clothing
• Feeding – the ability to prepare and feed oneself food
• Mental functions – memory, adaptive functioning, problem-solving, etc.
• Speaking – ability to be understood in verbal communication
• Hearing – the ability to hear, so functional communication is possible
• Vision – functionality of visual system despite treatment and devices

To qualify as having a “marked restriction”, you must either be unable to do the activity at all or take an extremely long time compared to someone without an impairment. This limitation must be present all or almost all of the time (generally 90% or more), lasted or is expected to last ≥12 months.

You Have “Significant Restrictions” in Two or More Basic ADLs

This category is for individuals who may not have a single “marked restriction” but have significant restrictions in two or more ADLs based on the cumulative effect.

Significant restrictions are less severe than marked restrictions, but still substantially impact daily functioning compared to someone without an impairment. The eligibility criteria for the cumulative effect are:

• Significant restrictions exist together ≥90% of the time
• The cumulative impact is equivalent to having a marked restriction in one ADL
• Restrictions persist despite therapy, medication, and devices
• Must have lasted or be expected to last ≥12 months

Someone with severe arthritis, for example, might have significant trouble with walking, dressing, and feeding themselves, and the combined effect of these challenges could make them eligible.

You need “Life-Sustaining Therapy”

Some individuals require regular life-sustaining therapy to support a vital body function. To qualify, the therapy must meet these conditions:

• Therapy supports a vital function
• Needed at least 2 times per week
• Takes an average ≥14 hours per week
• Expected to last ≥12 months

This includes the time spent not just receiving the therapy, but also setting up equipment, monitoring, and other essential related tasks. Common examples include dialysis, insulin therapy for Type 1 diabetes, oxygen therapy, and chest physiotherapy.

How to Apply for the Disability Tax Credit

If you determine you are eligible for the DTC, next you need to apply by filling out Form T2201 – Disability Tax Credit Certificate. There are two options: digital or paper application.

Digital Application

The digital option is quick and convenient if you have access to CRA’s MyAccount or prefer to apply by phone. Here’s how it works:

1. Fill out Part A online via MyAccount or by phone. Provide personal information and consent.
2. Receive a registration number.
3. Give the number to your medical practitioner.
4. The practitioner submits Part B digitally, certifying the effects of the impairment.

Paper Application

The paper option is ideal if you prefer a printed form or don’t have access to CRA’s online services.

1. Print Form T2201 from the CRA website.
2. Fill out Part A with your personal information and consent signatures.
3. Give the form to your medical practitioner.
4. The practitioner completes Part B and signs the certification.
5. Mail the application to the tax centre for your region.

Once submitted, it takes the CRA approximately 8 weeks to review applications and mail a decision. Follow up promptly on any requests for clarification.

Maximizing Your Disability Tax Credit Benefits

If your DTC application is approved, here are six tips to make sure you maximize the credits and benefits you are entitled to:

• Claim Retroactive DTC: You can claim up to 10 years of previous disability credits, going back as far as your impairment started.
• Transfer Credits: Any unused DTC amounts can be transferred to an eligible spouse, common-law partner, or another supporting person to claim on their taxes.
• File Adjustment Requests: Ask the CRA to adjust your previous tax returns to claim the maximum eligible disability amounts.
• Access Other Supports: The DTC provides access to other programs, such as the Registered Disability Savings Plan and the Child Disability Benefit.
• Re-Apply as Needed: Make sure to reapply prior to your DTC expiration date, providing updated medical evidence.
• Use Tax Resources: Consult with tax experts to implement additional eligible disability deductions and maximize any tax refunds.

How the Disability Tax Credit is Calculated

The DTC provides both federal and provincial disability amounts annually. Here is how the amounts are calculated:

Federal DTC Amount

The federal amount is 15% of the maximum disability amount set by the CRA each tax year.

According to the Government of Canada, the maximum federal disability amount for 2025 is $10,138 (Source). Therefore, 15% of this amount equals a federal DTC of $1,520.70.

If you are 18 years or older, you can claim the base federal disability amount of $10,138 for 2025.

If you are under 18 years old, you can claim the base federal amount of $10,138 plus an additional federal supplement of up to $5,914. This brings the total potential federal DTC to $16,052 for eligible minors.

Provincial DTC Amount

While the federal DTC amount is consistent country-wide, provincial and territorial DTC amounts vary between 5-15% of the applicable maximum disability amount set for that province and tax year.

The following table summarizes the maximum provincial/territorial DTC amounts for 2025:

Province/Territory	DTC Amount
Alberta	$16,882 if 18+ Use AB428 worksheet if under 18
British Columbia	$9,435 if 18+ Use BC428 worksheet if under 18
Manitoba	$6,180 if 18+ Use MB428 worksheet if under 18
Ontario	$10,017 if 18+ Use ON428 worksheet if under 18
Quebec	$4,009
Nova Scotia	$7,341 if 18+ Use NS428 worksheet if under 18
Yukon	$2,616 if under 18
New Brunswick	$9,747 if 18+ Use NB428 worksheet if under 18
Newfoundland and Labrador	$7,299 if 18+ Use NL428 worksheet if under 18
Northwest Territories	$14,088 if 18+ Use NT428 worksheet if under 18
Nunavut	$15,973 if 18+ Use NU428 worksheet if under 18
Saskatchewan	$10,894 if 18+ Use SK428 worksheet if under 18
Prince Edward Island	$6,890 if 18+ Use PE428 worksheet if under 18

For example, the provincial DTC amounts for 2025 are approximately:

• Ontario: $10,017 x 5.05% = $505
• British Columbia: $9,435 x 5.06% = $478
• Nova Scotia: $7,341 x 8.79% = $646

That said, DTC amounts depend on your age, province/territory. The total tax relief can be significant for offsetting disability costs.

How to Claim the Disability Tax Credit on Your Tax Return

Once your Disability Tax Credit application has been approved by the Canada Revenue Agency (CRA), you can start claiming the DTC on your personal income tax returns. Here are three steps:

Determine Who Will Claim the DTC

The first thing to figure out is who will be claiming the credit on their tax return. You have a few options:

• If approved for the DTC for yourself, you can claim it on your own tax return.
• Alternatively, you can transfer the DTC to an eligible spouse, common-law partner, or other supporting relation to the claim. This is done on Line 31800 of their tax return.
• For a child with a disability, the parent, grandparent, or other legal guardian claims the DTC.

Understand the DTC Amounts

Your approval letter from the CRA, called a “Notice of Determination,” is a key document. It will tell you exactly which years you are eligible to claim the DTC.

As previously mentioned, the credit itself has two parts: a federal amount and a provincial or territorial amount, which changes depending on where you live. Better yet, if the person with the disability is under 18, you can also claim an additional “disability supplement,” which increases the total value of the credit.

Claiming the Disability Tax Credit on Your Taxes

When you’re ready to file your T1 personal tax return, you just need to enter the disability amount on the correct line:

• For yourself: Claim on Line 31600
• For dependant: Claim on Line 31800
• For transfers: Provide supporting details

You can keep these points in mind to make the most of the DTC:

• Claim the DTC every year you are eligible
• Review your notice of determination for eligible years
• Maximize claims by combining related credits
• Get professional tax assistance if needed

Once you’ve filed, the CRA will apply the DTC to reduce any income tax you owe. If unused credits remain, you can transfer them to a spouse or partner to also reduce their tax burden.

Common Reasons and Challenges for DTC Application Denial

Unfortunately, it is quite common for DTC applications to be denied, even for clearly eligible applicants. Here are nine of the most frequent reasons for denials and challenges faced:

• Incomplete application forms missing information
• Medical practitioner errors in certification or unfamiliarity with eligibility criteria
• Inconsistencies between Part A and Part B of the application
• Restrictions described don’t meet “marked” or “significant” thresholds
• Lack of detail proving time durations for daily living activities
• Impairments don’t adequately restrict ADL functioning
• Cumulative effect not properly demonstrated
• Unsupportive medical practitioner unwilling to assist
• Complicated eligibility criteria misunderstood

If your DTC application is denied, don’t lose hope. Here are seven tips that may help with re-applying:

• Call the CRA for clarification on why you were denied
• Submit new applications with updated medical evidence
• Have a different practitioner clearly demonstrate restrictions
• Provide additional letters of support and medical details
• Keep thorough records proving disability status
• Seek assistance from a disability organization or tax specialist
• Be prepared to appeal and contest unfavourable decisions

While getting DTC approval involves jumping through many hoops, perseverance and the right evidence can eventually help demonstrate your entitlement.

The bottom line

The Disability Tax Credit provides crucial financial support that can make a significant difference for Canadians living with disabilities and their families.

While living with disability costs can be stressful, the Disability Tax Credit exists to help offset some expenses and ensure increased financial means. Determine if you qualify, meticulously work through the application, and don’t give up easily. With perseverance, you can gain access to this valuable government program.

FAQs about Disability Tax Credit in Canada

Article Sources

• Disability tax credit (DTC) – canada.ca
• Do I Qualify for the Disability Tax Credit? – canadadisabilitybenefit.ca
• The Disability Tax Credit Resource Guide (Updated March 2025) – disabilitycreditcanada.com