The number of people who overlook medical expense deductions at tax time is surprising. Their reasons are often complicated or they don’t think they have enough expenses to qualify.
Expenses add up and there may be enough for a medical expense tax credit but remember, these claims cannot be made without proper documentation.
The Canada Revenue Agency’s list of eligible deductions is always being revised, so it is wise to annually check them in case something formerly ineligible becomes deductible.
Private health service plans as well as employment health and dental plans and travel medical insurance are eligible as medical expenses.
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Medical expenses for a spouse or common-law partner and dependent children aged 18 and under can all be combined.
They should be claimed on the tax return of the person with the lowest net income for the biggest benefit.
Only expenses in excess of the lesser of $2,171 for 2014 ($2,208 for 2015) or three percent of the taxpayer’s net income can be claimed. The expense can also be claimed on the provincial tax schedule.
Medical expenses can fall into any 12-month period and are not limited to the calendar year. Eligible medical expenses paid in any 12-month period ending in 2014 and not claimed in 2013 can be claimed.
If the last claim ended June 15, 2013, and there were few or no expenses during July and August of 2013, the 2014 claim could start in September 2013 and go for 12 months.
Record keeping is key. Create a file folder and list of prescriptions, dates of appointments, distance travelled to appointments and receipts for the related medical expenses.
The list of what can be claimed as medical expenses is extensive and confusing, so many medical expenses are often overlooked. One example is travelling more than 40 kilo-metres to access certain medical care or therapy.
Public-transport or fuel costs can be claimed. If travel exceeded 80 kilometres, items like meals, accommodation and parking expenses can also be claimed.
This is particularly relevant for those living in rural and remote areas. If a medical practitioner certifies that the patient is incapable of traveling alone, transportation and accommodation expenses for a companion can also be claimed.
A simplified method for calculating meal and vehicle expenses can be found on the Canada Revenue Agency website, www.cra-arc.gc.ca.
If some of the medical expenses are paid by medical insurance or benefit coverage, the amount of the medical expense not covered can be claimed. For example, if the medical benefit covers 80 percent of the dental or eyewear expense, the remaining 20 percent can be used as a medical expense claim.
Any treatments, therapies, equipment, devices or medications that a health care professional has provided a prescription for can generally be claimed as a medical expense.
Examples are vitamin B12 injections for those with pernicious anemia or orthopedic shoes, boots and inserts. Also, vaccines that are not covered under provincial health care plans can be claimed.
If an individual has a severe and prolonged mobility impairment, the expense to modify the driveway, steps and interior of their primary dwelling to give them greater mobility and access can be claimed.
Gluten-free products can be claimed as a medical expense for an individual with celiac disease. They must also submit a medical practitioner’s letter confirming the diagnosis.
The claim is for the incremental costs associated with the purchase of gluten-free products. That cost is the difference in the cost of the gluten-free products compared to the cost of similar non-gluten-free products.
Intermediate items that are used to make gluten-free recipes such as rice flour and gluten-free spices are also allowed.
Costs for surgical or non-surgical reconstructive procedures as a result of an illness, accident, trauma, or disfiguring disease can be claimed.
Expenses that cannot be claimed are those already reimbursed for, which could include athletic or fitness club fees, non-prescription birth control devices, diaper services, organic food, personal emergency response services, over-the-counter medications, vitamins or supplements.
