CVITP Assist: Attendant Care as a Medical Expense

ATTENDANT CARE as a MEDICAL EXPENSE

Summary:

Person’s situation:	What they can claim or not claim:
Does not have a T2201, or a certificate from a medical practitioner of any kind.	Cannot claim attendant care fees or long-term care home fees as a medical expense.
Lives at home (could be a unit in a retirement residence). Does not have a T2201, but has a certificate confirming a need for attendant care by reason of impairment. Gets part-time care from attendants who live at or visit the home.	Cannot claim attendant care fees as a medical expense.
Lives at home (could be a unit in a retirement residence). Has a T2201. Gets part-time attendant care from attendants who live at or visit the home/unit.	Can claim up to $10,000 of attendant care fees as a medical expense and claim the DTC.
Lives at home (could be a unit in a retirement residence) Has a T2201. Gets full-time care from attendants who live at or visit the home.	Can claim: All of the attendant care fees as a medical expense - or - Up to $10,000 of attendant care fees as a medical expense and the DTC.
Lives at home (could be a unit in a retirement residence). Does not have a T2201, but has a certificate confirming a need for attendant care by reason of impairment. Gets full-time care from attendants who live at or visit the home/unit.	Can claim attendant care fees as a medical expense.
Lives in a long-term care home Has a T2201 Home’s invoice has an accommodation fee without breaking out fees for attendant care services.	Can claim the entire accommodation fee as a medical expense or claim the DTC, but not both.
Lives in a long-term care home Has a T2201 The home’s invoice has an accommodation fee that breaks out fees for attendant care services.	Can claim: The entire accommodation fee as a medical expense or the DTC but not both - or - Up to $10,000 of the attendant care fees as a medical expense and the DTC.
Lives in a long-term care home Does not have a T2201 Has a certificate confirming that, by reason of lack of normal mental capacity, they are and in the foreseeable future will continue to be dependent on others for their personal needs and care	Can claim the entire accommodation fee as a medical expense.

What is a certificate confirming a need for attendant care by reason of impairment?

The actual wording in the Income Tax Act requires the following:

“the patient is, and has been certified in writing by a medical practitioner to be, a person who, by reason of mental or physical infirmity, is and is likely to be for a long-continued period of indefinite duration dependent on others for the patient’s personal needs and care and who, as a result, requires a full-time attendant”

CRA’s website explains this in more simpler terms:

“a medical practitioner must certify in writing that you are, and will likely to be for a long continuous period of indefinite duration, dependent on others for your personal needs and care because of an impairment in physical or mental functions and need a full-time attendant.”

Key points:

There is no prescribed form for the certification; a signed letter from a medical practitioner is sufficient.
The certificate does not need to be filed with the CRA unless specifically requested.
Importantly, the certificate must exist before the tax return is filed.

Practical implication:

If relying on a certificate, a person cannot wait until the CRA asks for a certificate before obtaining one. If expenses are being claimed based on a certificate, the expenses should only be claimed if the certificate is already in hand at the time of filing.

What is attendant care?

Attendant care is not defined in the Income Tax Act. Courts have given guidance as to what it means. The CRA, guided in part by court decisions, describes it as care given by an attendant who does personal tasks which a person cannot do for themselves, including:

food preparation
housekeeping services for a resident’s personal living space
laundry services for a resident’s personal items
health care (registered nurse, practical nurse, certified health care aide, personal support worker)
activities (social programmer)
salon services (hairdresser, manicurist, pedicurist)
transportation (driver)
security for a secured unit

Not all of these tasks need to be provided. Any one or more could constitute attendant care.^[1]

Attendant care expenses do not include the cost of:

rent (except the part of rent for services that help a person with daily tasks, such as laundry and housekeeping)
food
cleaning supplies
other operating costs (such as the maintenance of common areas and outside grounds)
salaries and wages paid to employees such as administrators, receptionists, groundskeepers, janitors (for common areas), and maintenance staff

The Income Tax Act’s treatment of attendant care as a medical expense:

Table 1 below sets out the relevant sections of the Income Tax Act, and commentary on each of the subsections.

Table 2 below is taken from CRA guide 4065.

The tables make a distinction between a T2201 (i.e. a disability tax credit certificate), and a mere “certificate” which is a document from a medical practitioner certifying the need for attendant care due to impairment, and for which there is no prescribed form.

Table 1 - Income Tax Act sections:

Section 118.2(1) of the Income Tax Act provides a formula for calculating the medical expenses tax credit.

Section 118.2(2) states that for purposes of subsection (1), medical expenses include an amount paid as follows:

Income Tax Act wording:	Comments:
(b) as remuneration for one full-time attendant (other than a person who, at the time the remuneration is paid, is the individual’s spouse or common-law partner or is under 18 years of age) on, or for the full-time care in a nursing home of, the patient in respect of whom an amount would, but for paragraph 118.3(1)(c), be deductible under section 118.3 in computing a taxpayer’s tax payable under this Part for the taxation year in which the expense was incurred;	This subsection applies if a person paid for either (i) one full-time attendant or (ii) full-time attendant care in a nursing home. For (i), the expression “one full-time attendant” does not mean one person. For example, you could have 3 different people on successive 8-hour shifts. For (i), There is no restriction on the place where the person is receiving a full-time attendant. For (ii), the nursing home may or may not break out a charge for attendant care. If attendant care is broken out, then instead of this section, a person can rely on subparagraph b.1 instead. The expression “for the full-time care in a nursing home”, is broader than the cost of attendant care. The CRA has expressed in RC4065 that remuneration for full time care includes fees for accommodation. Therefore the full fee charged by a nursing home can be claimed, even if the nursing home breaks out an amount for attendant care. Section 118.3(1) provides for the disability tax credit. Therefore this section applies only if the person has a disability tax credit certificate (T2201). Section 118.3(1)(c) provides that the disability tax credit cannot be claimed if a claim is made under this subsection for the medical expense credit. Therefore the disability tax credit can be claimed, or this medical expense credit, but not both.
(b.1) as remuneration for attendant care provided in Canada to the patient if (i) the patient is a person in respect of whom an amount may be deducted under section 118.3 in computing a taxpayer’s tax payable under this Part for the taxation year in which the expense was incurred, (ii) no part of the remuneration is included in computing a deduction claimed in respect of the patient under section 63 or 64 or paragraph (b), (b.2), (c), (d) or (e) for any taxation year, (iii) at the time the remuneration is paid, the attendant is neither the individual’s spouse or common-law partner nor under 18 years of age, and (iv) each receipt filed with the Minister to prove payment of the remuneration was issued by the payee and contains, where the payee is an individual, that individual’s Social Insurance Number, to the extent that the total of amounts so paid does not exceed $10,000 (or $20,000 if the individual dies in the year);	This subsection is the only one not restricted to full-time care. The person must have a disability tax credit certificate (T2201). Section 63 is the Child Care Expenses Deduction. Section 64 is the Disability Supports Deduction. This section does not restrict the type of place the person may be in. The person could be in a nursing home, a retirement home or other assisted-living facility, or any other home or residence. An invoice that charges for more than attendant care will need to break out the amount paid for wages or salary for attendant care services. Section 118.3(1)(c) does not encompass this subsection. Therefore if this subsection applies, a person can claim up to $10,000 in medical expenses AND claim the disability tax credit (T2201).
(c) as remuneration for one full-time attendant on the patient in a self-contained domestic establishment in which the patient lives, if (i) the patient is, and has been certified in writing by a medical practitioner to be, a person who, by reason of mental or physical infirmity, is and is likely to be for a long-continued period of indefinite duration dependent on others for the patient’s personal needs and care and who, as a result, requires a full-time attendant, (ii) at the time the remuneration is paid, the attendant is neither the individual’s spouse or common-law partner nor under 18 years of age, and (iii) each receipt filed with the Minister to prove payment of the remuneration was issued by the payee and contains, where the payee is an individual, that individual’s Social Insurance Number;	This subsection only applies to full-time care. A disability tax credit (T2201) is not needed, but instead a different certification is needed (for which there is no special form) A self-contained domestic establishment includes a home or a self-contained unit in a retirement home, but does not include a unit in a nursing home. Section 118.3(1)(c) provides that the disability tax credit cannot be claimed if a claim is made under this subsection for the medical expense credit. Therefore the disability tax credit can be claimed, or this medical expense credit, but not both.
(d) for the full-time care in a nursing home of the patient, who has been certified in writing by a medical practitioner to be a person who, by reason of lack of normal mental capacity, is and in the foreseeable future will continue to be dependent on others for the patient’s personal needs and care;	This subsection applies to nursing home occupants who have a certificate stating they require attendant care due to lack of mental capacity. A disability tax credit (T2201) is not required. Note that a certification for lack of physical capacity does not qualify. Section 118.3(1)(c) provides that the disability tax credit cannot be claimed if a claim is made under this subsection for the medical expense credit. Therefore the disability tax credit can be claimed, or this medical expense credit, but not both.
(e) for the care, or the care and training, at a school, an institution or another place of the patient, who has been certified in writing by an appropriately qualified person to be a person who, by reason of a physical or mental handicap, requires the equipment, facilities or personnel specially provided by that school, institution or other place for the care, or the care and training, of individuals suffering from the handicap suffered by the patient;	If expenses fall under this subsection, it appears that s.118.3(1)(c) does not apply, allowing the person to both claim the amounts paid as a medical expense, and also claim the disability tax credit if the person has, in addition to the certificate, a T2201.

Table 2 - From CRA Guide 4065:

CRA Guide RC4065 contains the table below. However, this version adds the first column, Type of Expense, setting out the applicable section of the Income Tax Act.

Type of Expense	Certification needed	Can you claim the disability amount:
Fees paid for full-time care in a nursing home s.118.2(2)(a) or (d)	Form T2201 or a medical practitioner must certify in writing that you are, and in the foreseeable future will continue to be, dependent on others for your personal needs and care because of a lack of normal mental capacity.	You can claim the disability amount, if eligible, or these expenses, but not both.
Salaries and wages for attendant care given in Canada. This can include the part of the nursing home fees paid for full-time care that relate only to salaries and wages s.118.2(2)(b.1)	Form T2201	You can claim the disability amount and up to $10,000 for these expenses ($20,000 if the person died in the year). For residents of Ontario, the provincial limit is up to $17,147 for these expenses ($34,293 if the person died in the year).
Salaries and wages for one full-time attendant outside of a self-contained domestic establishment s.118.2(2)(b)	Form T2201	You can claim the disability amount or these expenses, but not both.
Full-time attendant at home s.118.2(2)(c)	Form T2201 or a medical practitioner must certify in writing that you are, and will likely to be for a long continuous period of indefinite duration, dependent on others for your personal needs and care because of an impairment in physical or mental functions and need a full-time attendant.	You can claim the disability amount, if eligible, or these expenses, but not both.
Salaries and wages for care or supervision in a group home in Canada s.118.2(2)(b.2)	Form T2201	You can claim the disability amount and these expenses.
Care, or training and care, at a school, institution, or other place (such as a detoxification clinic) s.118.2(2)(e)	Form T2201 or an appropriately qualified person must certify in writing that because of a mental or physical impairment, you need the equipment, facilities, or staff specially provided by that place for persons with the same type of impairments. Note: An appropriately qualified person includes a medical practitioner, the principal of the school or the head of the institution or other place.	You can claim the disability amount, if eligible, and these expenses.

References:

Income Tax Folio S1-F1-C1, Medical Expenses Tax Credit
Guide RC4065 Medical Expenses
Income Tax Act, s.118.2
General CRA web page on attendant care

[1] See for example Zaffino v. HMQ (2007) TCC 388 (Tax Court of Canada)