Understanding the Disability Tax Credit in Canada
If you or a loved one is living with a serious medical condition or disability, the Disability Tax Credit (DTC) can help reduce your income tax and make life a little more affordable.
But many Canadians don’t realize they qualify — or miss out because the application was filled out incorrectly.
This guide will walk you through what the DTC is, who’s eligible, how to apply, how much you can get, and what to do if your application is denied.
TL;DR: What You Need to Know About the Disability Tax Credit (DTC)
- The DTC is a non-refundable tax credit that helps reduce income tax for eligible Canadians with prolonged physical or mental impairments.
- You must apply through the CRA using Form T2201, with a medical practitioner’s certification.
- Eligibility is based on how the condition impacts daily life — not just the diagnosis itself.
- The credit can be worth up to $1,300+ per year federally, plus provincial amounts.
- If denied, you can request a review or appeal the decision.
What’s in This Guide
👆 Click to Expand
What is the Disability Tax Credit (DTC)?
The Disability Tax Credit (DTC) is a non-refundable tax credit that reduces the amount of income tax you may owe if you have a significant and prolonged physical or mental impairment.
It’s designed to help offset some of the extra living costs faced by people with disabilities in Canada.
You may be able to claim the DTC for yourself — or for a dependent, spouse, child, or parent — if they meet the eligibility criteria.
ℹ️ Quick Facts:
- The DTC can be claimed retroactively for up to 10 years.
- You must apply and be approved by the Canada Revenue Agency (CRA) before claiming it on your tax return.
- Medical eligibility is based on how your condition impacts daily activities — not just the diagnosis.
Who is Eligible for the DTC?
To qualify for the Disability Tax Credit (DTC), you must have a physical or mental impairment that is both:
- Severe: It significantly restricts your ability to perform basic daily activities; and
- Prolonged: It has lasted (or is expected to last) at least 12 consecutive months.
💡 It’s not about the diagnosis — it’s about the impact.
Many people assume you need to be in a wheelchair or have a visible disability to qualify. That’s false. Conditions like depression, diabetes, ADHD, chronic pain, or hearing loss can all qualify if they seriously affect daily living.
You May Be Eligible If Your Condition Affects Your Ability to:
- Walk or use your limbs
- Hear, see, or speak
- Dress or feed yourself
- Manage your bowels or bladder
- Remember, plan, or make decisions (mental functions)
- Receive and follow life-sustaining therapy (like dialysis or insulin)
A qualified medical practitioner (such as a doctor, nurse practitioner, or psychologist) must certify the effects of your condition on the CRA’s application form.
How Much is the DTC Worth?
The Disability Tax Credit can save you over $1,300 per year on your federal taxes — and more when you include provincial amounts.
Because it’s a non-refundable tax credit, it won’t give you a refund if you have no taxable income — but it reduces how much income tax you owe.
Approximate Annual Value:
- Federal portion: Up to $1,350
- Provincial portion: Varies by province (e.g. $750+ in Ontario)
- Combined total: Often $2,000+ per year
If you were eligible in the past but didn’t apply, you may also be able to claim up to 10 years retroactively, resulting in $20,000+ in potential tax relief.
👨👩👧 Claiming for a Dependent:
If a spouse, child, or other dependent qualifies for the DTC but doesn’t have enough income to benefit, you may be able to transfer the credit to your return — especially if you support them financially.
How Do You Apply for the DTC?
To apply for the Disability Tax Credit (DTC), you must complete CRA Form T2201, which has two main parts:
Step-by-Step Application Process
- Download Form T2201
Available from the CRA website. - Fill Out Part A (Your Information)
Includes your name, SIN, and whether you’re claiming for yourself or someone else.
- Ask a Medical Practitioner to Complete Part B
Must be filled out by a doctor, nurse practitioner, or specialist (e.g. audiologist, psychologist).
They’ll certify how your condition affects specific activities of daily living. - Submit the Form to the CRA
You can send it by mail or submit it digitally through My Account on the CRA website. - Wait for a Decision
CRA typically responds in 8 to 16 weeks. They may request additional medical info before deciding.
If you were eligible in the past but didn’t apply, you may also be able to claim up to 10 years retroactively, resulting in $20,000+ in potential tax relief.
💡 Pro Tip: Have your medical provider be specific and detailed. Vague or overly technical answers can lead to delays or denials.
Common Mistakes to Avoid
Even if you qualify for the Disability Tax Credit, a small mistake can lead to rejection or costly delays. Here are the most common pitfalls:
Top 7 Mistakes People Make on DTC Applications
- Focusing on the diagnosis, not the daily impact: Approval is based on how your condition affects daily functioning — not the medical label.
- Submitting vague or incomplete forms: The CRA needs clear, detailed answers. “Has difficulty walking” isn’t enough.
- Choosing the wrong type of medical provider: Only certain professionals can fill out specific sections of the form (e.g. psychologists for mental functions).
- Missing the 12-month duration requirement: Your condition must last — or be expected to last — at least 12 consecutive months.
- Leaving Part B to be filled out without guidance: Many healthcare providers aren’t familiar with CRA expectations. They may unintentionally cause a denial.
- Not checking for retroactive eligibility: You may qualify for up to 10 years of backdated credits — but only if you ask.
- Submitting without keeping a copy: Always scan and save a copy before mailing or uploading your form.
What If Your DTC Application is Denied?
Getting denied for the Disability Tax Credit (DTC) doesn’t mean you’re out of options. Many eligible Canadians are initially refused due to vague forms, incomplete details, or misunderstandings by the CRA.
You Can Request a Review or File an Appeal
- Ask the CRA to Review the Decision
Submit a letter or request through your CRA My Account. You can include new medical information or clarification from your doctor. - File a Formal Objection
If a second review still results in denial, you have 90 days to file a Notice of Objection. This is a more formal step and may require help from a legal or tax professional. - Appeal to the Tax Court of Canada
If you disagree with the CRA’s response to your objection, you can escalate the matter to court — though few cases get this far.
🚨 When to Get Legal Help: If you believe you were unfairly denied the DTC — especially after submitting strong medical documentation — you need to speak to True North Disability Services to explore your options.
Disability Tax Credit FAQs
✅ Is the Disability Tax Credit a Monthly Payment?
No. The DTC is not a monthly payment — it’s a non-refundable tax credit that reduces how much income tax you owe each year.
✅ How Much is the Disability Tax Credit Worth Per Year?
The federal portion is worth up to $1,350, and most provinces offer additional amounts. Combined, the DTC is often worth $2,000+ per year.
✅ Can I Claim the DTC For Someone Else?
Yes. If your spouse, child, or other dependent qualifies for the DTC but can’t use the credit themselves (e.g. they don’t earn enough), you may be able to transfer it to your return.
✅ Can I Apply for the DTC Retroactively?
Yes — you can request the CRA to backdate your eligibility for up to 10 years, which could result in thousands in tax savings.
✅ Does Getting the DTC Mean I’m Approved for Other Disability Benefits?
Not automatically. While DTC approval can help support other applications (like RDSPs or CPP Disability), each program has its own criteria.
🚨 When to Get Legal Help: If you believe you were unfairly denied the DTC — especially after submitting strong medical documentation — you need to speak to True North Disability Services to explore your options.
Get Help with the Disability Tax Credit
If you need help applying for the Disability Tax Credit (DTC) or were previously denied, we recommend speaking with a trusted third-party service that assists Canadians with DTC claims.
They specialize in helping individuals and families navigate the application process, correct errors, and request reviews or appeals from the CRA.
Denied Disability or Insurance Claim? We Can Help
While Samfiru Tumarkin LLP doesn’t assist with DTC applications, we do represent individuals in Canada who have been denied, delayed, or cut off long-term disability insurance benefits. You’re not alone — and you don’t have to face your insurance company on your own.
We are Canada’s leading disability law firm, with a strong track record representing individuals across the province. Our experienced long-term disability lawyers understand how insurers operate — and how to push back when they act unfairly.
✅ Insider Advantage: Sivan Tumarkin, co-founding partner of Samfiru Tumarkin LLP, previously worked for insurance companies. Today, he uses that knowledge to advocate for disabled individuals across Ontario. He knows insurers’ strategies, and how to level the playing field in your favour.
We also help with related insurance claims:
💲 No Win, No Fee: Our disability lawyers work on a contingency basis — you don’t pay unless we recover compensation.
Free Consultation – Speak With Us Today
Connect with Canada’s top disability law firm today. Call us at 1-855-821-5900 or email help@disabilityrights.ca to get started. You can also watch our popular Disability Law Show, explore our Free LTD FAQs, or join a Livestream Q&A for real-time answers from the Samfiru Tumarkin LLP team.
Why Canadians Trust Samfiru Tumarkin LLP
- 👥 Over 50,000 clients helped nationwide
- 💰 Millions recovered in compensation
- ⚖️ No win, no fee — you don’t pay unless we succeed
- ⭐ 3,063 5-star Google reviews across Canada (4.7 average)
- 🏆 Named one of Canada’s Best Law Firms by The Globe and Mail