As a taxpayer in Canada, you can claim tax credits for eligible medical expenses paid by either your spouse or common-law partner. This tax credit is known as a medical expenses tax credit, and you will find all you need to know about the medical expenses tax credit in Canada in this article.
Eligible Medical Expenses
You can claim non-refundable tax credits on medical expenses. These tax credits are applicable for medical expenses incurred in 12 months (tax year) for you and/or your spouse or common-law partner. You can also claim it for tax credits you have not claimed in the previous tax year.
However, there are eligible medical expenses that you can claim credit on. That is, even if you did not pay these expenses in Canada, you could still claim them.
There is a long list of eligible medical expenses you can claim on your tax return. Below are some of them;
- Acoustic coupler
- Air filter/cleaner/purifier
- Ambulance service
- Baby breathing monitor
- Bone marrow transplant
- Cancer treatment
- Dental services
- Medical services by medical practitioners
- Drugs and medical devices bought under Health Canada’s Special Access Program
- Walking aids
To support your claim for some medical expenses, you may need to provide prescriptions, receipts, certification, or a disability tax credit certificate (if required). You are not required to send any of these documents with your tax return, but you should have them just in case the Canada Revenue Agency (CRA) requests them.
How to Claim Medical expenses Tax Credit
You can use line 33099 of any of your tax returns to claim tax credits on medical expenses for yourself, your spouse or common-law partner, your children, or your spouse’s children under the age of 18 at the end of the tax year.
On the other hand, you can use line 33199 of your tax return for dependants such as;
- Your children or your spouse’s children older than 18 or your grandchildren,
- Parent, grandparents, siblings, aunts, uncles, nieces, and nephews who resided in Canada at any time in the tax year you want to claim the expenses for;
How to Calculate Medical Expenses Tax Credit
All provinces in Canada except Quebec use the Federal medical expense total to calculate the provincial medical expense tax credit. The steps below explain how to calculate your medical expense tax credit in Canada:
If you are using line 33099 to make your claim, below is how to go about it:
- On line 33099, enter the total amount that you or your spouse or common-law partner paid in the tax year (e.g., 2020) for eligible medical expenses.
- Enter whichever is lesser of the following the following line:
3% of your net income (entered on line 23600 of your tax return), or
CA$2397(2020) or CA$2,421(2021) (non-refundable tax credit for provincial amounts.
- Deduct the amount you enter in line 2 from the amount on line 33099 and enter the result on the following line.
- Claim the corresponding provincial or territorial tax credit on line 58689 of your provincial or territorial form 428.
The exact process applies if you claim the tax credit on 33199, except that you have to calculate the tax credit for each dependant and use the dependant’s net income to calculate the amount.
If more than one person supports a dependant, each person can claim up to the maximum as long as the total amount claimed by all supporting persons does not surpass the total medical cost for the dependant.
Example of Medical Expenses Tax Credit
For instance, Mr. and Mrs. Trent have their net income as CA$50,000 and CA$45,000, respectively. They have a child who is ten years old, and their medical expenses for the tax year are CA$5000.
If Mr. Trent decides to claim the medical expenses tax credit, the amount he will be able to deduct will be calculated thus;
3% of CA$45000 = CA$1350
Since this amount is less than $2397, it will be deducted from CA$5000, leaving him with CA$3650 as the deductible tax credit.
If Mrs. Trent decides to claim it;
3% of CA$40000 = CA$1200
The lesser amount to deduct from CA$5000 leaves her with $3800 as the tax credit.
Therefore, the lower net income spouse should claim the medical expenses tax credit to have a higher amount. If they have a child or other dependants are over 18, the child’s net income or the dependant’s net income will be used to calculate the amount.
Claiming Medical Expenses Tax Credit for Deceased Dependent
Also, you can claim a medical expenses tax credit for a deceased dependant for expenses paid within 24 months, including the date of death. This claim is applicable if the expenses have not been claimed before the dependant’s demise.
In Canada, you or your spouse’s medical expenses tax credit can be claimed for eligible medical expenses paid in a tax year for either of you and/or your dependents. You can also claim for dependents, and the process is quite easy.