Regardless of their particular circumstances, Canadians who act as unpaid caregivers for disabled, elderly, or chronically ill relatives carry a heavy physical and emotional burden. The weight of those responsibilities is often made greater by financial stresses, particularly where the situation requires full-time caregiving, to the extent that the caregiver is unable to work outside the home in paid employment. In addition, caring for someone who is disabled or chronically ill often means incurring additional out-of-pocket expenses, whether for medical supplies or equipment, or for making alterations to a home in order to make it possible for the individual being cared for to stay in that home.
The good news is that there a number of tax deductions, credits, and benefits made available through our tax system to help mitigate the burden of those additional costs. The bad news is that the rules governing which credits or benefits can be claimed and in which circumstances can, unfortunately, be confusing. The complexity of those rules likely means that many caregivers who may be eligible to claim such credits or benefits are unaware that they can do so, or don’t know how to claim those credits and benefits in the most tax-effective way possible.
Generally speaking, the tax credits available to caregivers (and to those for whom they care) can be divided into three categories. The first type of credit is claimable by individuals who have a condition or disability which significantly limits their ability to live, work, or care for themselves without assistance. The second kind of credit is provided to a family member who supports or acts in a caregiving capacity to that ill or disabled individual. Finally, the third category of credit can be claimed, by either the disabled individual or their caregiver, to help offset costs incurred costs for specific purposes related to the need for caregiving.
No matter which credits are or are not available in a particular situation, the first – and perhaps most important – “strategy” to maximize the available tax assistance is for both the caregiver and the person receiving care to file a tax return every year. Disabled individuals are, unfortunately, often among the lowest-income Canadians, and it’s sometimes assumed that where income is low, and no tax is payable, there’s no point in filing a tax return. However, the reality is exactly the opposite. Eligibility for many, if not most, federal tax credits and benefits is based on income, and lower- and middle-income Canadians are the ones most likely to qualify for such benefits. As stated on the Canada Revenue Agency (CRA) website: “[E]ven if you do not owe tax, are tax-exempt, or have no income to report, you should do your taxes every year to avoid missing out on benefit and credit payments and tax refunds. The information from your tax return is used to calculate payments.”
Credits claimable by a person needing care
Disability supports deduction
In many instances, individuals who have some form of disability can nonetheless attend school or engage in paid employment where needed accommodations or supports are provided. Where those supports involve an expenditure on the part of the individual, they may be able to claim a deduction from income for those costs.
The disability supports deduction allows an individual to claim a deduction for any of a specified list of eligible expenses including, for example, the cost of Braille printers, large print-on-screen devices, or voice recognition software. In some, but not all, cases, a prescription and/or certification from a medical practitioner are needed to enable the deduction to be claimed. A full listing of disability supports which can qualify for the deduction, together with detailed information on the disability supports deduction itself, can be found on the CRA website at https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/deductions-credits-expenses/line-21500-disability-supports-deduction.html#wb-auto-4.
Disability tax credit
In monetary terms, the disability tax credit (DTC) is the most significant federal tax credit which can be claimed by a disabled individual. In order to claim that credit, however, it is necessary to first submit an application to the Canada Revenue Agency. That application will include a detailed assessment by a medical professional indicating whether the individual has a medical condition which significantly or markedly restricts that person’s ability to carry out daily activities like walking, dressing, feeding, speaking, or hearing, and that such restriction is likely to last at least 12 months.
The criteria for approval of an application for the DTC are detailed and specific and the wait time to have a decision on an application made by the CRA can be lengthy. However, where such application is approved, the individual can claim a non-refundable tax credit amount of $10,138 (for 2025), meaning that income up to that amount can effectively be received without paying federal tax. As well, the claim for the DTC credit can be transferred, in whole or in part, to one or more family members who support the disabled relative, to reduce their tax payable for the year.
Details of the DTC can be found on the CRA website at https://www.canada.ca/en/revenue-agency/services/tax/individuals/segments/tax-credits-deductions-persons-disabilities/disability-tax-credit.html.
Credits claimable by caregivers
There are a number of tax credits which can be claimed by an individual who acts as a caregiver to another family member, or on whom a family member depends for support. Each such credit has its own set of eligibility criteria which must be met, by both the caregiver and the person receiving care or support. Regrettably, the rules governing the interaction of these credits can be very confusing – for instance, in some circumstances claiming a particular credit can mean losing eligibility for a similar credit. As well, eligibility for and the amount of credit claimable can vary depending on several factors, including the age and income of the dependant or person receiving care, as well as the nature of the relationship (i.e., spouse versus non-spouse dependant) between the caregiver and the person receiving care.
The CRA website does include a comprehensive listing of all of the credits which may be claimed by an individual who provides care for or supports a family member. That listing includes details of the eligibility criteria for each credit, the circumstances in which such credit can or cannot be claimed, and how each credit interacts with the others. The full listing on the Agency’s website is as follows.
- Line 30300 – Spouse or common-law partner amount
- Line 30425 – Canada caregiver amount for spouse or common-law partner, or eligible dependant age 18 or older
- Line 30400 – Amount for an eligible dependant
- Line 30450 – Canada caregiver amount for other infirm dependants age 18 or older
- Line 30500 – Canada caregiver amount for infirm children under 18 years of age
Tax credits for home renovation expenses
Home accessibility tax credit
Frequently, when someone becomes ill or disabled, changes must be made to that person’s home in order to enable them to continue living there, or to increase their safety or mobility in that home. Such changes may be as small as a grab bar installed in the shower or as large as a chairlift for the stairs or even a renovation to provide a ground floor bedroom or bathroom. For many such renovations, a home accessibility tax credit can be claimed
In order for any claim for the home accessibility tax credit to be made, the person for whose benefit the changes are being made must be either aged 65 and older or be eligible for the disability tax credit. In order to qualify, the home to which the renovations are being made can be owned by that person or jointly owned by that person and a supporting relative. In all cases, however, the person for whose benefit the renovations are being carried out must live in that home.
Regardless of who owns the home, the credit can be claimed by the elderly or disabled individual or by their spouse. It can also be claimed by another family member who is the individual’s caregiver, as long as that caregiver has claimed any one of a specified list of tax credits for providing support for that person – and that list includes the caregiver tax credit.
Where those eligibility criteria are met, either the person requiring care or their spouse or caregiver can claim a non-refundable tax credit of up to $3,000 for up to $20,000 in eligible expenses incurred during the year, or the credit can be shared among them. Detailed information on eligible expenses and how to claim the credit can be found on the CRA website at https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/deductions-credits-expenses/line-31285-home-accessibility-expenses.html.
Multi-generational home renovation tax credit
In some circumstances, an individual who requires family support can no longer live safely in their own home and the solution is often for that person to move in with another family member – usually one of their children. Making that change often means a need to renovate to provide living space for the disabled or elderly individual and, once again, a tax credit can be claimed for eligible expenses incurred to do so. That tax credit – the multigenerational home renovation tax credit – provides a non-refundable credit of up to $7,500 for up to $50,000 in eligible renovation expenses. For purposes of the credit, eligible renovation expenses are those incurred to provide a self-contained secondary housing unit for a relative who is 65 years of age or older, or who is eligible for the disability tax credit. Details of the multigenerational home renovation tax credit can be found on the CRA website at https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/about-your-tax-return/tax-return/completing-a-tax-return/deductions-credits-expenses/multigenerational-home-renovation.html
The availability of support for ill or disabled individuals and/or their caregivers through our tax system is clearly a good thing. However, the sheer number of tax credits and deductions which can be claimed and, in particular, the complexity involved in determining both which credits are available in which circumstances and which credit claims will produce the best tax result can be overwhelming. The CRA has brought together on a single webpage information on each of the different aspects of our tax system which may be utilized by caregivers and their dependants, and that webpage can be found at https://www.canada.ca/en/revenue-agency/services/tax/individuals/segments/tax-credits-deductions-persons-disabilities.html.
The information presented is only of a general nature, may omit many details and special rules, is current only as of its published date, and accordingly cannot be regarded as legal or tax advice. Please contact our office for more information on this subject and how it pertains to your specific tax or financial situation.
