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PART 2 DISABILITY TAX CREDIT - DIAGNOSIS OR OUTCOME - TAXPAYERS OFTEN TAKE THE WRONG ROAD This is the second of ten articles that I promised on the DTC. Many people believe that their medical diagnosis is the basis to claim the DTC. That is wrong. The DTC claim is based on a taxpayer showing that they are unable or take an inordinate amount of time carrying out a basic activity of daily living. It's a bit more complicated than that but we will follow up in later posts. So, y...ou don't need a diagnosis to claim the DTC but you need a medical certification of the outcome. The Income Tax Act names the eight qualifying activities that must be long term and be present and all or substantially all of the time. These activities are vision, speaking, hearing, walking, eliminating, feeding, dressing and mental functioning necessary for everyday life. Mental functioning is a single activity but divided between, memory, adaptive functioning and problem solving, judgement and goal setting taken together. CRA gives inadequate examples of adaptive functioning as self care, health and safety, social interaction and numeracy skills which is very narrow and discussed later (PART 3). The Income Tax Act and CRA further limit some of the basic activities shown above. https://lnkd.in/exjZWge

DISABILITY TAX CREDIT INTRODUCTION - PART 1 I have spent more time than I want to think about reading through the disability tax credit (DTC) provisions. They a...re far too complex for most taxpayers and even tax professionals so the DTC and the many tax benefits that go with it such as the Registered Disability Savings Plan, attendant care tax credit, Qualified Disability Trust go unused. The DTC is discussed in Chapters 6 and 7 of The Family Guide. Consequently , in this and my next nine posts, I am going try to clarify important aspects of the DTC under the following headings: 1 - INTRODUCTION 2 - DIAGNOSIS OR OUTCOMES - TAXPAYER WRONG ROAD 3 - MARKEDLY OR SIGNIFICANTLY RESTRICTED 4 - QUALIFYING PHYSICAL ACTIVITIES - THE EASIEST PART 5 - QUALIFYING COGNITIVE ACTIVITIES - HERE'S A PROBLEM AREA 6 - ADAPTIVE FUNCTIONING - WHAT IS IT? 7 - OTHER QUALIFYING SITUATIONS - A HIGH BAR 8 - FORM T2201 - INTERPRETATION AND CONFUSION 9 - DEFINITIONS - MADE TO FAIL YOU 10 - SUMMING UP THE DTC - DIABOLICAL AT BEST Many people who should benefit from the DTC are not. and that's the shame of it. I think you will find this discussion interesting. Give me your thoughts. as we move along For more information visit www.thefamilyguide.ca

DISABILITY ADVISORS SHOULD DO A BIT MORE HOMEWORK When it comes to disability, it’s my experience that financial and legal advisors sometimes jump to solutions without really defining the issues. So often I see a Henson Trust created when there are only one or two years between the expected death of a parent and the time when their child will no longer qualify for social assistance. Or an RSDP is set up when its not really needed because the individual with a disability has... very little need for money because of their high level of disability. So, advisors should step back and do some analysing, including a life plan, before they put forward solutions. The Family Guide will help advisors understand the complexity of disability and how it relates to financial and legal solutions.