What is Diabetes Canada's position on tax credits for people living with diabetes?

The Government of Canada should institute a system of enhanced tax credits wherein people with diabetes would be eligible for consideration for a non-refundable tax credit or a refundable payout specifically designed to reduce the burden of higher medical and treatment costs.

Read Diabetes Canada's full position statement on tax credits

The Disability Tax Credit (DTC) for Canadians with Diabetes

People with diabetes may be eligible for the Disability Tax Credit (DTC) if they meet the eligibility criteria for receiving a life-sustaining therapy.

What are the eligibility criteria for the DTC?

The Canada Revenue Agency (CRA) must receive confirmation that the applicant spends at least 14 hours per week on the activities specified by the CRA (listed below) that are related to administering insulin.

Who can apply for the DTC?

Parents of children with type 1 diabetes

Kids with type 1 diabetes under the age 18 years may be eligible for the DTC, as long as the child’s physician signs the T2201 Disability Tax Credit Certificate to certify that the eligibility criteria are met.  Most kids under age 18 qualify for the DTC because the child and parent/guardian time can be combined to meet the 14 hour per week criteria.  The CRA will require individuals to reapply when they turn age 18.

Adults with diabetes

Adults must discuss their eligibility with their doctor.  Many adults with type 1 diabetes do not qualify for the DTC because the CRA has not received adequate information that they spend at least 14 hours per week on the activities specified by the CRA related to administering insulin.  The CRA must receive confirmation from physicians that their patients who are applying for the DTC spend at least 14 hours per week on the activities.

It may be helpful for adults to document the time they spend on the CRA specified activities (listed below) and provide this information to their physician.  After receiving the physician certified T2201 Disability Tax Credit Certificate, the CRA may request additional information from your physician to support your eligibility to receive the DTC.

What activities does the Canada Revenue Agency (CRA) permit to be included the 14 hour per week calculation?

  • Monitoring blood sugar
  • Preparing and administering insulin
  • Calibrating/preparing necessary equipment, including changing infusion sites for the insulin pump
  • Maintaining a logbook of blood sugar levels

What activities does the CRA not permit?

  • Counting carbohydrates
  • Exercising
  • Treating and recovering from hypoglycemia or hyperglycemia
  • Meal preparation
  • The time the insulin pump takes to deliver insulin
  • Attending medical appointments
  • Shopping for medication

Diabetes Canada advocates to the federal government for the expansion of the DTC to ALL Canadians living with type 1 diabetes

Diabetes Canada recommends the federal government either expand the interpretation of the Income Tax Act or amend Section 118.3 of the Income Tax Act to permit all Canadians living with type 1 diabetes to claim the DTC.

Since type 1 diabetes is a complex disease and its management is a 24/7 responsibility, Diabetes Canada is asking the federal government to permit the time spent on all activities related to administering insulin (e.g. counting carbs; treating and recovering from lows; meal planning related to time activity profile of insulin used) to be counted toward the 14 hours per week criteria.  This could ensure that adults with type 1 diabetes rightfully qualify for the DTC and enable all young Canadians with type 1 diabetes to access and grow a Registered Disability Savings Plan (RDSP) for their future.

Are there other tax credits available for people with diabetes?

See the CRA’s website for current tax credits and deductions for Canadians with disabilities at http://www.cra-arc.gc.ca/disability/

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