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Koroll & Company Blog

Financial Support for Families Raising a Child With a Disability

[fa icon="calendar"] Jun 28, 2019 11:00:00 AM / by Allen Koroll

A happy mother and daughter

Raising a child and planning for their future can be expensive, even more so when your child has a disability. Thankfully, for families who pay unavoidable additional expenses for their child with a disability - such as therapy, medical equipment, and special programs - there is potential relief to create greater tax equity in the form of tax credits, benefits and government programs.

Disability Tax Credit

If your child has a disability which requires additional support and expenses, you should start by applying for the disability tax credit.

The Disability Tax Credit is a non-refundable tax credit which helps individuals with disabilities and those who support them. To be eligible for the credit, a medical professional must fill out Form T2201 - Disability Tax Credit Certificate and certify that your child has a severe or prolonged impairment. This form must then be approved by the Canada Revenue Agency (CRA).

If you receive approval and your child is under 18, you will receive a transferable tax credit. In 2018 the maximum disability amount for individuals under 18 was $13,039.

The problem is, however, that many families are not aware that they may be eligible for the credit. This is often because we assume that the disability must be visible but, non-physical medical conditions, such as autism, cerebral palsy, diabetes and down syndrome, also qualify.

To determine whether your child may be eligible, considered the following:

  1. Has your child’s physical or mental impairment lasted (or is expected to last) for at least 12 months?
  2. Is your child blind, receiving life-sustaining therapy or restricted in speaking, hearing, walking, eliminating, feeding, dressing, and/or performing mental functions?

If you answered yes to both questions, you may be eligible for the DTC. For more details on eligibility, please visit the CRA website.

Federal Matching Programs

If your child qualifies for the Disability Tax Credit, you are also eligible to open a Registered Disability Savings Plan (RDSP), which also gives you access to government matching programs.

These matching programs are similar to those offered for Registered Education Savings Plans (RESP).

Depending on your family’s income and the contribution you make, the government will offer grants of up to 300% up to $3,500 a year and $70,000 in a lifetime. At a minimum, each family who contributes $1,000 to an RDSP in a year will receive a minimum grant of $1,000.

Canada Disability Savings Bond

In addition to the above matching program, there is a savings bond that is also available to families with low to modest income families who have an RDSP for their child with special needs. This bond is equal to up to $1,000 a year ($20,000 in a lifetime).

It is important to note that, if your RDSP was open in 2008 or later and you did not contribute the maximum amount those bonds and grants that you did not receive will be carried forward, with limits.

Child Disability Benefit

In addition to the above opportunities, you may also qualify for the child disability benefit payment, which is paid out as a tax-free addition to your Canada child benefit. To qualify for this benefit, you must be eligible for the disability tax credit and the Canada child benefit.

The benefit is paid out monthly up to a yearly maximum of $2,771. To find out approximately how much you will receive, check out the CRA’s Child and family benefit calculator.

For more information on the tax credits, government programs and benefits available to help you support your child with special needs, contact us today.


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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.



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Topics: Tax Deductions

Allen Koroll

Written by Allen Koroll