How Was The Canadian Disability Tax Credit Program Established?
Beginning
The Canada Revenue Agency (CRA) introduced the Disability Tax Credit initiative with the purpose of helping 22% of Canadians who are living with prolonged physical or mental impairment (CSD, 2017) and their families offset the various costs associated with those impairments such as medications, special equipment, personal support etc.
According to the findings from the 2017 Canadian Survey on Disability (CSD), one in five Canadians (6.2 million) has one or more disabilities that restrict the performance of their daily activities.
Prior to 1986, the Canada Revenue Agency had a standard deduction reserved for individuals who used wheelchairs or were blind. When more disabilities and mental illnesses became more visible and recognized, taxable income benefits were offered to the persons who suffered from these conditions as well.
In 2005, “prolonged impairments” became the key definition to help people determine their eligibility. This definition created a path for persons with disabilities that struggled with day-to-day common tasks to receive disability benefits.
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How Does The Disability Tax Credit Affect Your Other Governmental or Provincial Benefits?
- Once found eligible for the DTC, you are also qualified to set up a Registered Disability Savings Plan (RDSP). The RDSP is a long-term savings plan providing benefits in the form of disability savings grants and bonds.
- The DTC is a federal program and it does not affect or alter your status of other government or provincial programs such as OSAP/student loans, ODSP (Ontario), AISH (Alberta), Disability Assistance (British Columbia), etc.
- As part of the DTC, the Child Disability Benefit is a tax-free monthly payment (not based on federal taxes paid) made to families who care for a child under age 18 with a severe and prolonged impairment in physical or mental functions.
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