Medical Expense Tax Credit
A taxpayer can claim a non-refundable tax credit for medical expenses paid by the taxpayer or the taxpayer's spouse or common-law partner. The medical expenses claimable include those paid for the taxpayer, the taxpayer's spouse or common-law partner, or a child under 18 of the taxpayer or spouse, who is dependent on the taxpayer or spouse for support.
There is a separate calculation for the medical expense tax credit for other eligible dependents.
Medical expenses can be claimed for any 12 month period ending in the current tax year (and not claimed in the prior tax year). When medical expenses are being claimed for a deceased person (either dependent or other eligible dependent), they may be claimed for any 24 month period including the date of the person's death (and not claimed in a prior year). In order to claim all medical expenses for 24 months in the year of death, the tax return for the prior year could be revised so that no medical expenses are claimed, leaving them available for the year of death. To do this, a T1Adj must be filed. See the article on changing your tax return.
Generally, all eligible medical expenses can be claimed, even if they were incurred outside of Canada. When medical expenses are reimbursed by an insurance plan, only the portion not reimbursed can be claimed.
Medical expenses for the taxpayer, the taxpayer's spouse or common-law partner, and dependent children under 18 are claimed on line 330 of the federal tax return. Only expenses in excess of the lesser of $1,925 (federal, for 2007) or 3% of net income can be claimed. The lowest tax rate is applied to the medical expenses to determine the amount of the tax credit.
Medical expenses for other eligible dependents
Medical expenses may be claimed for amounts paid on behalf of a person who is dependent on the taxpayer for support, and who is
- The child over 17, or the grandchild, of the taxpayer or the taxpayer's spouse or common-law partner; or
- The parent, grandparent, brother, sister, uncle, aunt, niece or nephew (if resident in Canada at any time in the year) of the taxpayer or of the taxpayer's spouse or common-law partner
Medical expenses for other eligible dependents are claimed on line 331 of the federal tax return. A separate calculation is done for each dependent. Only expenses in excess of the lesser of $1,925 (federal, for 2007) or 3% of net income of the dependent can be claimed, up to a maximum of $10,000 per dependent (federal). The lowest tax rate is applied to the medical expenses to determine the amount of the tax credit.
The provincial maximum allowable medical expenses for other eligible dependents is $10,000 for most provinces.
If more than one person supports the dependent, each supporting person can claim up to the maximum of $10,000, as long as the total claimed by all supporting persons does not exceed the total medical costs for the dependent. This would make it advantageous to share high medical costs (such as nursing home costs) among supporting persons. For example, the supporting persons could be husband and wife supporting a parent or grandparent or adult infirm child, or could be siblings supporting a parent or grandparent. The key is that each supporting person making a claim must have a receipt to support their claim.
See also Canada Revenue Agency (CRA) topic Medical Expenses, in document RC4064 - Medical and Disability-related Information.