As many of you know the Disability Tax Credit (DTC) is a credit to income tax otherwise payable, available for those with a severe or prolonged impairment. It is meant to provide some relief from the additional costs and expenses incurred associated with the impairment.
I have written in the past that for many in and/or associated with the provision of tax advice and preparation, the application and qualification for the DTC is often found to be less than straightforward, complicated to many despite CRA’s admonitions to the contrary. Many applicants have gone so far as to engage specialists, some who charge a fee in the form of a % of the refunds/claims made!
In my practice, aside from the common issues of poorly completed forms and/or inadequate supporting documentation from a medical practitioner, I don’t always receive the specific details as to why a particular disability tax credit has been denied other than the generic ”we are of the opinion that the claim did not fit the criteria” or something along those lines.
So it was with interest that I was referred to Laing v. The Queen 2019 TCC 267, as the Judge in his reasons for judgment provided a detailed analysis of precedent law and interpretations, and administrative practice as it applied to this matter (as one would expect) which I found informative. The Judge acknowledged that the Income Tax Act does not provide specific direction on various terms of the DTC.
Ms. Laing was diagnosed with bipolar disorder and irritable bowel syndrome. She made a claim for the DTC for a 3 year period and the claim was denied. She appealed to the Tax Court of Canada. She represented herself and quite capably it appears. By the way, she fired a specialist firm who was handling the claim for her before the appeal.
The issue before the Court was whether Ms. Laing’s well documented physical and mental health challenges had the cumulative effect of causing a significant restriction with one or more basic activity of daily living.
Regrettably, the appeal was denied. Ms. Laing was unable to persuade the Court that the cumulative effect of her restrictions was causing an inordinate or excessive amount of time to complete her basic activities. The law and administrative practice associated with the application of “marked restrictions”, which is one of the underpinnings of the DTC, is dealt with in great detail.
If you are at all interested, I would encourage you to read the case. The judgment sets out some of the key criteria to a successful claim, beyond getting the forms done correctly!
As featured on All About Estates Blog where Baker Tilly WM Partner, Steven Frye, is a regular contributor.
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