The Benefits of the Disability Tax Credit
Getting approved for the Disability Tax Credit (DTC) can open up a number benefits to those who qualify. Not only may you be eligible to receive $1,900 to $2,200 a year ($5,500-$6,000 for children) but it also opens up doors to other credits and benefits.
Claiming Credits in Previous Years
Registered Disability Savings Plan (RDSP)
Claiming Credits in Previous Years
Claiming the disability tax credit retroactively, in previous years, can result in a substantial tax credit from the Canada Revenue Agency (CRA). The total amount received can vary for a variety of reasons (the amount varies from province to province, if you’re claiming for someone under the age of 18 and if you qualify as a caregiver), but the primary one is when an individual’s eligibility for the Disability Tax Credit (DTC) first began, as you can file for the credits going back the past ten years.
The year of getting diagnosed with a condition is often not the same year eligibility for the DTC first began. Often symptoms are present long before being officially diagnosed with a condition.
An adept understanding of the eligibility criteria is required to determine the year eligibility first began for the disability tax credit.
Once approved for the Disability Tax Credit, you will continue to be eligible to receive the disability tax credit every year. The potential savings for the disability tax credit is $1,900 to $2,200 a year. Over ten years that is savings of $19,000-$22,000. These figures do not include the additional amounts if you’re claiming on behalf of a dependant under the age of 18 or if you qualify for the Canada Caregiver Credit.
One advantage of using our service is that we will make sure you are informed about all of the programs available to you and continue to provide you with guidance in the future.
The Registered Disability Savings Plan (RDSP)
Once you get approved for the Disability Tax Credit, you will want to set up a Registered Disability Savings Plan (RDSP). The RDSP is a long-term savings plan providing benefits in the form of disability savings grant and bonds. The RDSP was introduced in 2008 and offers significant savings to those who know how to navigate the program.
The Canada Disability Savings Bond:
- The Disability Savings Bond is $1,000 a year and $20,000 lifetime limit.
- Your family income must be $45,916 or less.
- If your family income is above $30,000 but less than $45,916, you will receive a portion of the $1,000 Disability Bond.
The Canada Disability Savings Grant:
- When you contribute $500 to an RDSP, the government will contribute $1,500 to your RDSP. You can do this once per year.
- When you contribute an additional $1,000 to your RDSP, the government will contribute $2,000 to your RDSP.
- That results in the RDSP accumulating $5,000 every year, from a $1,500 contribution, $3,500 being provided by the government. The lifetime limit the government of Canada will provide is $70,000.
The Canada Caregiver Credit
Previously known as the caregiver credit, infirm dependant tax credit and family caregiver tax credit in years prior to 2017. The Canada Caregiver Credit is a credit that is in addition to the Disability Tax Credit (DTC) for those who care for a family member who depend on them consistently for basic necessities such as food, shelter or clothing expenses.
There are also additional supplements for children, caregivers, home buyers, RESPs. We will review your potential to claim these additional supplements, as well as the disability tax credit during your initial free assessment.
Have a Question?
For more information, check out our Frequently Asked Questions (FAQ) page.