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4 common Disability Tax Credit application mistakes you might be making

December 14, 2016

Many people come to us for help because their Disability Tax Credit (DTC) applications were declined when they applied. To find out what went wrong in the first place, we look at their applications, their medical histories and interview them personally.

Unsurprisingly, most of these mistakes result from being unfamiliar with the Disability Tax Credit criteria or simply due human error. Two-thirds of the time, we’re able to fix their applications and get success!

If you’re looking for tips on how to apply for the DTC, you can learn from our experience as we share the top 4 Disability Tax Credit mistakes that we regularly see people make on their applications.

1. Not being descriptive enough

Don’t assume a diagnosis for a certain medical condition will be enough to qualify for the Disability Tax Credit. Rather, the Canada Revenue Agency wants to know how the disability or medical condition affects one’s ability to perform basic activities of daily living (BADL’s).

We’ve seen applications that fail to connect one’s disability with BADL’s – these applications often get declined.

Case in point, one application that passed our hands simply described “chronic leg pain”. When we interviewed this client thoroughly, we discovered his leg pain prevented him from walking more than 20 metres and advised him to “tell your doctor exactly what you told us just now.”

Our recommendation to anyone: description is key for your DTC application’s success.

2. Describing irrelevant information

We regularly catch inconsistencies that would result in an outright decline by the Canada Revenue Agency.

For example, on the Disability Tax Credit form, the doctor chooses one (or several) BADL to certify as restricted. If the doctor selects walking as the restriction, then all his/her descriptions of one’s disability must be consistent with that BADL.

We’ve seen an application that described one’s restrictions to walking as “this patient can’t do housework: they can’t wash dishes, do laundry, change bedding, clean the bathroom.”

The description simply did not speak to the BADL selected, but luckily we caught this error before it was too late.

3. Entering the incorrect year of when disability started

What year did your disability start? Do you count from the year of a doctor’s diagnosis, the year the doctor started seeing you for your disability, or the year that your disability started?

We see this seemingly simple question completed in all different ways. Unfortunately, many doctors are unfamiliar with the accurate way to answer this question, so we follow up to let them know.

The disability year actually refers to when the person with the disability was markedly or significantly restricted in their ability to perform basic activities of daily living. This means even if a small child was only diagnosed as deaf when she is 4 years old, she may still qualify for the Disability Tax Credit for all the years prior to her diagnosis.

4. Simply not checking the DTC application form for errors

Sometimes people make mistakes that go unnoticed. Nobody means to make them, but accidents do happen. We’ve seen applications with misspelled names, missing signatures, incorrect years and other glaring errors. Any one of these slip-ups could result in a decline, or at least a very long delay on claiming the Disability Tax Credit.

Our simple, but necessary advice: always double-check your forms before you leave the doctor’s office. A doctor must certify one’s disability by filling out the mandatory sections on the Disability Tax Credit application form. If mistakes were made, it’s always best to catch them earlier rather than later.

When we scrutinize our clients’ completed DTC applications, we compare them to the notes we take from our client-interviews. Despite our best efforts to educate all actors involved in the DTC process, mistakes sometimes do happen. It’s just a matter of knowing which errors to look out for and you’ll save yourself a lot of potential headache and delay.

If you find yourself still running into troubles (maybe the CRA has declined your DTC application multiple times, even though your doctor has certified your disability), professional help is available to you.

Schedule to speak with us directly about your case and we can help find out what went wrong.

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