Tax assistance for persons with disabilities.

• Author: Devaney, Joseph R.

According to a 2012 Statistics Canada survey, an estimated 3.8 million adults in Canada are living with a disability. Of those in the survey aged 75 or greater, 42.5% suffered from one or more disabilities that limited their daily activities.

Fortunately, Canada has several tools to assist us in dealing with these challenges from a financial perspective. For many, reductions in tax payable for either the person with the disability or a caregiver are available. In addition, there are several benefits, grants and other support mechanisms offered. This article will provide an overview discussion of the more common opportunities available through the income tax system as well as the Registered Disability Savings Plan (RDSP). For many, reductions in tax payable for either the person with the disability or a caregiver are available. In addition, there are several benefits, grants and other support mechanisms offered The availability of these opportunities is primarily based on the level of disability and the income of the individual, the caregiver and their respective families. We will discuss these aspects using rates, thresholds, and values for an Alberta resident in the 2014 calendar year.

Opportunities by level of disability

Category 1--An impairment of physical or mental function that is severe and lasts at least 12 months

The individual must either be markedly restricted in the ability to perform a basic activity of daily living (or significantly restricted in enough activities to be considered markedly restricted in the whole), or would be restricted but for life-sustaining therapy. In order to prove this level of disability, Form T2201--Disability Tax Credit Certificate, must be completed (indicating these conditions have been met) and signed by a "Qualified Practitioner" (which generally means a doctor qualified to opine on the applicable disability).

To meet the markedly restricted test, it must take the individual an inordinate amount of time (which the Canada Revenue Agency (CRA) suggests to usually be three times the normal amount of time), or he/she must be unable to perform one of the activities of daily living all or substantially all of the time (at least 90% of the time). The activities of daily living include: speaking, hearing, walking, elimination, feeding, dressing, and mental functions necessary for everyday life.

To be significantly restricted, a person's vision or ability to perform a basic activity of daily living must...