---
title: Year End Tax Planning – Timing of Medical Expenses
description: Medical expenses can add up quickly but there is a tax credit. Do you know what medical expenses you can claim? Claiming medical expenses should be part of your tax planning.
image: https://www.koroll.ca/hubfs/Blog_Images/calculator-385506_1280.jpg
---

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## [Year End Tax Planning – Timing of Medical Expenses](https://www.koroll.ca/koroll-and-company-blog/year-end-tax-planning-timing-of-medical-expenses)

 [fa icon="calendar"] Jan 5, 2018 10:55:18 AM / by [Allen Koroll](https://www.koroll.ca/koroll-and-company-blog/author/allen-koroll)

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![Year end tax planning medical expenses](https://www.koroll.ca/hs-fs/hubfs/Blog_Images/calculator-385506_1280.jpg?width=320&name=calculator-385506_1280.jpg "Year end tax planning medical expenses")Even with Canada’s provincial healthcare plans, medical expenses can add up quickly. This is because the number of expenses not covered by these plans is constantly increasing.

If you are lucky enough to have a private plan through your employer, these costs may be reduced, but for many, there is no way around partially or fully paying for unavoidable medical expenses including, but not limited to:

- Dental care
- Prescription drugs
- Ambulances
- Physiotherapy

Fortunately, there is a tax credit, which, if planned for effectively, can help optimize your 2017 [tax planning](https://www.koroll.ca/tax-services) strategy before year end.

**About the Medical Expense Tax Credit **

Unfortunately, there is no general rule that can be followed for determining the eligibility of a medical expense. To find out whether an expense is eligible, head to the [Canada Revenue Agency (CRA)](https://www.canada.ca/en/revenue-agency.html) website.

Once you have determined which of your medical expenses qualify, it is time to determine your tax credit. The rule of thumb, for claiming eligible medical expenses, is that any amount over the lesser of 3% of your income **OR** $2,268 can be claimed for the medical expense tax credit.

Put simply, if your net income is less than $75,500 in 2017, you can claim all eligible expenses over 3% of your income. If you make more than $75,500 you can claim any expenses over $2,268.

**Optimizing Your Medical Expense Tax Credit **

The medical expense tax credit is unique in that you can choose to claim expenses from the previous year, so long as they were not claimed on that year’s income tax return.

More specifically, you can choose any 12-month period ending anytime in 2017 to claim your medical expenses.

This can be beneficial if you had a costly medical expense in 2016 that did not push you over your threshold, as well as costly medical expenses in 2017.

**Example:**

In 2016 you made $50,000. Your medical expense threshold was $1,500 ($50,000 *3%). In November of 2016 you had eligible dental work completed for $1,400. It was your only medical expense for 2016. Because it was not over your threshold, you did not claim it.

In February 2017, you made $60,000 which makes your medical expense threshold $1,800 ($60,000 x 3%). In October of 2017, you had more eligible dental work completed for $1,600. Even though the $1,600 expense does not put you over your 2017 threshold, because you did not claim the $1,400 in 2016 you can include it on your 2017 tax return.

In this case, you would choose a 12-month period starting November 2016 and ending 12 months later in 2017, so that you could receive a tax credit on $1,200.

Expenses Eligible for the Medical Expense Tax Credit = ($1,400 + $1,600) - $1,800 = $1,200

Unfortunately, there is no quick and easy way for determining which 12-month period to use as it depends on your specific situation.

**Combining Medical Expenses**

It is important to note that all eligible medical expenses incurred by the taxpayer, their spouse, their dependent children and some other dependent relatives can be added together and claimed by one family member to further optimize the amount claimable. In most situations, the claim can be further optimized by having the lower income spouse claim the expenses, as they will have a smaller threshold.

For more information on claiming medical expenses and for help determining which 12-month period would best optimize your return, [contact us](https://www.koroll.ca/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](https://www.koroll.ca/koroll-and-company-blog/topic/tax-deductions), [CRA](https://www.koroll.ca/koroll-and-company-blog/topic/cra)

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