Disability Tax Credit


The Disability Tax Credit is a non-refundable tax credit that can be used by persons with disabilities to reduce the amount of income tax they will have to pay. Some people with mental illness are eligible for this tax credit.

The purpose of the disability tax credit is help with the additional costs related to living and working with a disability.

Find Disability Tax Credit Services and Supports

FAQ: About the Disability Tax Credit

Am I eligible for the disability tax credit?

The credit is available to "anyone who has a severe prolonged mental or physical impairment, which causes them to be markedly restricted in any of the basic activities of daily living."

The application form asks, "Do the effects of your impairment cause you to be markedly restricted in… mental functions necessary for everyday life?"

The term "markedly restricted" means that you are unable all of the time or substantially all of the time (or it takes you an inordinate amount of time) to perform one or more of the basic activities of daily living, even with therapy, devices or drugs. The basic activities of daily living include mental functions necessary for everyday life. These mental functions include

  • memory
  • problem solving, goal-setting and judgment (taken together)
  • adaptive functioning

Source: Disability-Related Income Tax Provisions, 2006

What do I do if I'm denied the disability tax credit?

You can appeal the decision. According to experts on disability tax law, many appeals are successful (Introduction to the Disability Tax Credit, ARCH Disability Law Centre, 2004). See the Canada Revenue Agency's information on "Resolving Disputes" at www.cra-arc.gc.ca.

Related Resources

More Information about the Disability Tax Credit

Fighting for Fairness, Lembi Buchanan
This 2004 presentation from the Making Gains in Mental Health and Addictions conference discusses the need for fairness in the income tax system for people with mental illness.

Links

Technical Advisory Committee on Tax Measures for Persons with Disabilities
This committee was appointed by the federal Minister of Finance and the Minister of National Revenue to address issues related to tax measures benefiting persons with disabilities.


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