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The Disability Tax Credit (DTC) and the Registered Disability Savings Plan (RDSP) are two programs the Canadian government uses to support residents living with a disability. Eligible residents can claim up to $90,000 in government grants. The unique Child Disability Benefit also covers children with disabilities. To qualify for the disability benefits, you must prove that you live with a severe, permanent, or persistent disability.
What is a T2201?
Form T2201 is a Disability Tax Credit Certificate you are expected to fill to claim disability benefits from the support programs available. Without the T2201, you won't be able to claim any benefits from government support programs. The form has two parts: You should fill all the relevant fields in Part A or find a legal representative to help you. Part B is to be filled by a licensed medical practitioner in the field of your disability. This can be a medical doctor, nurse practitioner, audiologist, optometrist, physiotherapist, occupational therapist, psychologist, or speech-language pathologist.Easy, fast, and even fun. Wealthsimple Tax is CRA-certified tax software that you’ll actually want to use. And you only pay what you want, no catch — get started.
Where Do I Send My T2201?
There are two ways to send your T2201 disability tax credit certificate to the CRA. The easiest method is to finish everything online through CRA My Account. If you don't have an account with CRA, you should create one immediately. Make sure you submit the forms before filing annual tax returns and keep a copy. Remember that you don't need to file a T2201 certificate to CRA each year; you just claim the credit on your return each year. If you aren't comfortable with CRA's NETFILE and EFILE online slip submission, you can still download your T2201 for manual entry. Print the form, fill the necessary sections, and mail it to your tax centre.
Who Should Fill Out a T2201?
The disability tax credit form has two main parts filled by the applicant (or representative) and a licensed medical practitioner. Since the slip determines eligibility for disability benefits, the CRA expects applicants to prove their need for support. There are no clear guidelines as to who is eligible. However, you can fill form T2201 for the following disabilities:
a) Physical Impairments
This includes chronic pain, visual and hearing disabilities, and physical disabilities. It covers injuries and diseases that leave you incapable of performing daily activities, such as seeing, hearing, standing, sitting, and walking.
b) Mental Illnesses
This includes mental disorders, such as mood and psychotic disorders (bipolar, schizophrenia, depression). It also includes anxiety and personality disorders, eating disorders, substance abuse disorder and trauma-related disorders. The applicant must have solid proof showing how these disorders interrupt daily life.
c) Neurological Impairments
This covers multiple sclerosis, Alzheimer's disease, Parkinson's disease, stroke, epilepsy and other neurological disorders that affect how you live. The disability tax credit is only available for Canadian citizens.
You should note that having a disability won't automatically make you eligible for the benefit. Instead, the CRA examines the effect your disability has on general living conditions. In most cases:
The applicant must be "markedly" restricted in one or more basic activities of daily life.
The disability must be persistent and continuous for at least one year.
The disability must be present at least 90% of the time.
If you have a disability but don't meet some of these requirements, you can still fill out form T2201 to let the CRA determine whether you are eligible for tax credit benefits.
Which Sections of The Form Do I Fill Out?
The T2201 features Part A, which is the section that must be filled out by those applying for DTC benefits. Part B will be filled by a medical practitioner to show proof of disability and how it impacts your daily living. If you are unable to complete Part A, your legal representative can do this on your behalf. There are four main sections in Part A of the form and you can still qualify for DTC even without a taxable income. Part B also has several boxes designed to describe the disability and help CRA determine whether you are eligible for a disability tax credit. Read the breakdown of all sections below.
T2201 Breakdown (Box by Box/Line by Line)
T2201 is a 9-page form with two parts. Part A of the slip is designed to help determine your eligibility for the disability tax credit and includes the following sections:
This is where you enter your first and last name, mailing address and social insurance number (SIN). It is to be completed and signed by the person applying for the tax credit.
If you don't have enough taxable income, you will be required to fill in section 2. It allows another person to claim your eligible tax credits since DTCs are transferable. Those with adequate taxable income should skip this section. Applicants are expected to include first and last name, SIN and the relationship to the person applying for the tax credit. You must also explain how you financially support a person with a disability. The CRA considers financial support to include food, shelter and clothing.
Sections 3 and 4
Section 3 is where you tell the CRA to adjust your tax returns or choose another service that can help you get the most from your DTC retroactive funds. The last section (4) is for authorization, where you add a sign and date to the application.
The doctor will fill part B of the form, so you shouldn't worry about the specific unless you are a medical practitioner making these entries. The doctor should decide how your disability affects aspects of basic living, such as vision, speaking, walking, feeding, eliminating, dressing, necessary mental functions and life-sustaining therapy. Your doctor will also fill the Cumulative Effect of Significant Restrictions section if you have multiple impairments/disabilities. If you want more details on filling out the T2201, you can find instructions on the CRA website.
What Happens After T2201 Approval?
You can claim your DTC once CRA approves the T2201 form. Approval means you qualify for the tax credits offered to those living with disabilities. The DTC is a non-refundable tax credit that can reduce your tax payable to $0. The CRA also allows you to claim disability tax credit amounts for your children (below 18 years old).Wealthsimple Tax is a simple way to file your taxes. File your return with confidence it’s done right, and pay what you want—there’s no catch.
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