On December 2, 2022, the Canada Revenue Agency’s Disability Advisory Committee submitted 10 new recommendations for its third annual review. The purpose of the committee is to suggest improvements to tax legislation that affects people in Canada with disabilities.
The 10 recommendations listed on Canada.ca are as follows:
Disability Tax Credit (DTC) Eligibility
1. The CRA and the Department of Finance Canada should change the term ‘impairment’ to ‘limitation’ in all DTC-related administrative and legislative documents.
2. Decisions to expand the pool of health providers, one provider group at a time, who can complete the DTC application form (T2201) take time and expertise that neither CRA nor the Department of Finance Canada possess.
3. Any licensed health provider, whose license is in good standing, be permitted to complete the DTC application (Form T2201).
4. The CRA should replace the current eligibility criteria for life-sustaining therapies as set out in the DTC application (Form T2201) with a designated list of identified therapies.
DTC Review and appeals
5. CRA to share DTC appeals data with the Committee to better understand which demographic groups are experiencing challenges.
6. The CRA should better communicate to DTC applicants who launch an objection or appeal, that they will remain eligible for all DTC-related benefits and credits until the appeal is resolved.
DTC Legal issues
7. The Department of Finance Canada should amend the Income Tax Act (ITA) and/or the CRA amend its policy, to allow a person with a mental disability to appoint a representative to manage their tax affairs without resorting to legal guardianship.
8. Over the long-term, the federal government should apply the Peace, Order and Good Government clause to encourage the creation of a national minimum-standard legislative framework for supported decision-making laws.
9. The CRA encourage the Department of Finance Canada to exempt DTC beneficiaries from the capital gains on the sale of a home entrusted to them.
10. The federal government broaden the list of persons defined as “qualified family member” in the ITA to include siblings to act as RDSP plan holders for persons with mental disabilities.