You may be owed money for past years
If your impairment began years ago, approval of the Disability Tax Credit (DTC) does not have to start with this year. The CRA says you may be able to claim the credit going back up to 10 years, if you were eligible in those years but did not claim it. For some families, that means a meaningful refund.
Ask on the form
Part A of Form T2201 asks whether you want the CRA to adjust your previous tax returns if you are approved. If you check yes, the CRA will reassess the earlier years for which you are eligible.
If you did not check that box, you can still ask. The CRA says you can use the "Change my return" option in your CRA account, or send a letter asking the CRA to adjust your earlier returns.
The start date matters
The CRA can only apply the credit to years when you met the criteria. That makes the date your impairment began very important. When your health care provider completes Part B, ask them to give the earliest date they can support from their records. If they only know you for a short time, older records from other providers may help.
When a family member claims the credit
If the person with the disability does not need all of the credit, some or all of it can be transferred to a supporting family member, such as a parent, spouse or adult child. The family member must provide at least one basic necessity, such as food, shelter or clothing.
When a family member wants to claim the credit for earlier years, those adjustments are made to the family member's own returns. This is a common place where claims stall, so make sure the family member's details are complete and that the right person asks for the right years.
Keep good records
- Keep a copy of your approved T2201 and the CRA's notice of determination.
- Keep your notices of assessment for each earlier year.
- Write down which years you asked to adjust, and when.
Adjustments can take time. If months go by with no change, it is worth following up with the CRA.
The DTC opens other doors
Approval can also make you eligible for other programs, such as the registered disability savings plan (RDSP) and the Canada workers benefit disability supplement. If you are approved for past years, ask whether those programs can look back too.
This is general information, not legal or tax advice. Rules and amounts change, so confirm the details for your situation with the CRA or a professional. If you would like help, you can book a consultation with Andrew Green Law.
This article provides general information about the law in Alberta and is not legal advice. Every situation is different. Reading this article does not create a lawyer-client relationship. For advice about your circumstances, contact Andrew Green Law.