Disability Insurance

Do you have a health condition that is hampering your ability to work or perform daily tasks at your fullest potential? If so, did you know that being a Canadian you could very well be eligible for a disability tax credit of over $25,000? Yes, you read that right! What’s more, you don’t have to be ‘disabled’ to qualify for this income tax benefit as according to the Canada Revenue Agency (CRA) there are two categories of disability. But more on that later.

First, what is a Disability Tax Credit (DTC)? And what health conditions are applicable in order for you to qualify? Well, for answers to these questions and a lot more you have come to the right place. Let’s take an in-depth look at “disability tax credit” and all the medical and health conditions that qualify.

What Medical Conditions Can Qualify For Disability Tax Credit?

Thousands of medical conditions are in fact applicable for DTC. To make life simpler, we will take a look at some of the most common medical conditions that regularly qualify.

Difficulty Walking/Slowed Walking

Medical conditions such as osteoarthritis, knee/hip problems, poor blood circulation, and foot disorders can all lead to difficulty in walking. Such health conditions make you ‘walk slowly’ and can hamper your daily activities.

List:

Knee/Hip Problems, Osteoarthritis, Poor Circulation, Foot Disorders

Breathing Disorders

If you suffer from chronic asthma, COPD, sleep apnea, emphysema, or in rare cases tuberculosis you automatically qualify for DTC.

List:

COPD, Emphysema, Tuberculosis, Chronic Asthma, Sleep Apnea

Limited Upper & Lower Body Mobility

Any medical conditions that can cause mobility issues can deem you eligible for DTC. This includes back and neck pains, weakness in arms or legs, or being overweight as a result of pre-existing medical conditions.

List:

Weak/Shaky Hands or Arms, Back/Neck Problems

Cognitive Issues

It’s not just the body that can impair you from being able to conduct daily tasks. The mind is just as important. Conditions such as memory loss, Alzheimer’s, ADHD, depression, dementia, etc. are all applicable.

List:

Memory Loss, Confusion, Alzheimer’s, Dementia, Depression, ADHD

Impaired Hearing

If you are close to being deaf, have poor hearing, or require the use of hearing aids you qualify for DTC.

List:

Hearing Aids, Need of Hearing Aids, Poor Hearing 

Digestive Disorders

It’s not just the external physical impairments that can hinder you from performing daily tasks. Internal issues, particularly those related to the digestive system, are equally significant. 

List:

Inflammatory Bowel Disorder, Crohn’s/Colitis, Incontinence, Prostate

Understanding “Disability” & “DTC”

Disability Tax Credit (DTC) is essentially a non-refundable tax credit that is provided by the CRA to help reduce the amount of income tax people with disabilities or their supporting persons have to pay when filing their returns. 

Being eligible for DTC can also open up other possible federal, provincial, or territorial relief programs such as child disability benefit, registered disability savings plan, and the Canada workers benefit program. 

What many Canadians don’t realize is that the CRA has two categories under DTC; disabled group and slowed group. Eligibility for either group is not based solely on the medical condition itself, but rather, on how that condition affects impairment.

Disabled Group

This group contains all individuals that are disabled to an extent that they are unable to perform even the basic activities needed for daily living.

Slowed Group

Not many people know about this category as many Canadians believe that DTC is only applicable to ‘disabled’ individuals. That’s not true! The ‘slowed group’ according to the CRA, includes all individuals who take a lot more time to do basic daily activities as a result of existing medical conditions. 

Does It Matter What Group You Fall Under?

Both groups qualify equally for DTC and receive the same level of benefits. However, shockingly, very few Canadians who fall under the ‘slowed group’ ever apply for DTC. This could be because either they are not aware that they qualify or their advisors don’t believe they are. 

Note: Disabled & Slowed Individuals Can Both Qualify For Disability Tax Credit & Receive Equal Benefits!

Frequently Asked Questions (FAQs)

Q1) If I qualify under DTC am I considered ‘disabled’?

No, you are not. All claims and benefits within the DTC program remain independent and confidential between you, your medical practitioner, and the CRA. It is up to you to authorize if you want anyone else to know. Even those who would normally have access to your private income tax information would not have access to your DTC information unless you have provided explicit consent. 

In no way, does applying or being approved for a disability tax credit, label you as being ‘disabled’. Remember, DTC is purely from an income tax standing, not a medical standing. It has no bearing on a formal medical classification in any way. 

Q2) Are there any cons to receiving DTC benefits?

As DTC is but an income tax reduction credit it bears no negative financial implications for those receiving DTC credits. Basically, you are not getting anything extra. You are simply getting a reduction on the amount of tax you owe. Thus, DTC is not considered income and thus doesn’t impact other income or health benefit sources you may. So, no, there are no real cons to receiving DTC credits for any Canadian.

Q3) How to apply for DTC?

In order to apply, you must first submit Form T2201, Disability Tax Credit Certificate. Part A of the form needs to be completed by the disabled person or a family member. Part B of the form needs to be filled out by a medical doctor or health practitioner. Approval of Form T2201 is needed from the CRA before you can file your taxes and claim DTC. 

Q4) Medical conditions that qualify for the tax credit and eligibility criteria

Qualifying for the Disability Tax Credit in Canada

The Disability Tax Credit (DTC) in Canada is a non-refundable tax credit designed to help those with severe and prolonged impairments reduce their income tax. The eligibility for this credit is not strictly based on the specific diagnosis, but rather on the severity and duration of the impairment caused by the condition. A wide range of conditions can potentially qualify for the DTC. These include, but are not limited to, cancer, diabetes, multiple sclerosis, cerebral palsy, epilepsy, deafness, blindness, intellectual disability, autism, Tourette’s syndrome, muscular dystrophy, chronic fatigue syndrome, Crohn’s disease, Alzheimer’s disease, Parkinson’s disease, schizophrenia, bipolar disorder, major depressive disorder, anorexia nervosa, bulimia nervosa, and post-traumatic stress disorder. Each of these conditions, if severe and prolonged, could potentially meet the eligibility criteria for the Disability Tax Credit in Canada, providing much-needed financial relief for those affected and their families.

Who Should I Call To Get Started?

If you believe you fall under either the disabled or slowed group and would like to discuss how DTC could be applicable to you based on your insurance policy it is always best to first consult with the experts. 

When you think of experts, you think of McIver Insurance. Based out of Halifax, NS, we specialize in all types of insurance matters. If you are seeking medical insurance, health insurance, life insurance, or are looking for a better policy we got you covered!

A quick, free, and no-obligation chat is all you need in order to figure out what insurance plan would be best suited to your needs.

An employee may be eligible for long-term disability benefits if they have a mental disorder, physical condition, or permanent injury that hinders the employee’s work performance. It is highly likely that these employees can collect long-term disability benefits, especially if their employer’s group plan covers them. Employees that have their own private insurance policy with paid current premiums can also be eligible to receive long-term disabilities.

The Canada Pension Plan provides compensation to individuals with a disability that prevents them from successfully earning a living. Policyholders can qualify for long-term disability benefits because of a medical condition that demands a prolonged absence from work. The individual can get these benefits only after all other means of income, such as vacation time, sick leave, and short-term disability benefits have been used. Long-term disability benefits can provide between 60% to 70% of the employee’s monthly income, giving the individual the opportunity to live a financially stable life.

The concern with most workers filing for disability claims is that there is always the possibility that they can deny their claim. Insurance providers can deny disability claims on valid legal grounds. Let’s look at some of the most common reasons for disability claims being denied in Nova Scotia.

Medically Qualifying For Disability Benefits

Every insurance policy has unique eligibility requirements for policyholders that claim long-term disability benefits. In real life, different insurance policies issued by the same insurance company will have a different definition of “disability” in each one of their policies. Not being able to meet the insurance policy’s description of disability is one of the most common reasons for a disability claim denial. The employee might not perform their duties because of a physical or mental handicap, but they cannot claim benefits for the long-term disability.

In most cases, the insurance provider’s precise definition of disability will determine if the employee receives disability benefits. Some of the most common health conditions that can qualify for disability benefits in Nova Scotia are:

• Back problems
• Bipolar mood disorder
• Cardiovascular disease
• Chronic pain or complex regional pain syndrome (CRPS)
• Depression
• Lyme disease
• Post Traumatic Stress Disorder (PTSD)
• Psoriatic Arthritis (affects interphalangeal joints)
• Several other physical conditions

The policyholder can not receive any sort of disability benefits unless they meet the medical description of disability according to the insurance provider. The definition includes any physical or mental conditions that do not allow the employee to perform their employer’s contractual duties. Policyholders receive disability benefits for the first two years after the accident based on this condition. Some insurance providers refer to policyholders in their “own occupation” stage during this time.

According to the insurance provider, the policyholder’s condition after two years takes a turn for the worse. Now the policyholder can NOT complete ANY task, whether it is associated with their work or not. Remember, different insurance providers use different terminology, and sometimes getting a qualified expert opinion is the best option.

Inadequate Documentation To Support Your Disability Claim

All insurance providers require policyholders to submit medical documentation to support their disability claim before they can begin receiving any disability benefits. All the documents must be authorized by the proper medical or legal authorities. Medical records, lab results, and a doctor’s declaration are just some documents that corroborate a claim for long-term disability benefits. Failure to provide all the documents or documentation with the proper verification can result in your disability claim being denied.

Your claim will be denied if the documents you provide do not match the medical description of disability based on your insurance provider or the documents fail to display the full extent of your disability. Insurance providers require claimants to show that they are under constant physical and medical supervision by a qualified general physician to increase the chances of their claim being approved. If your disability claim has been denied due to a lack of supporting documentation, you can reverse the decision by presenting the appropriate documentation.

Pre-Existing Health Conditions & Meeting Insurable Interest Demands

Potential policyholders must meet the insurance provider’s demands before the insurance policy becomes active. A majority of insurance providers require their clients to declare any pre-existing medical conditions before the policy comes into effect. Potential policyholders must supply insurance providers with authorized documentation in support of a new insurance policy to become active. These documents often include the latest health reports to ensure that the would-be policyholder does not already have any of the conditions listed in the policy.

Most insurance providers do not allow their policyholders to file a disability claim for a pre-existing medical condition. Some insurance providers give new policyholders limited coverage during the initial coverage period. The policyholder must hold the policy by regularly paying scheduled premiums for a certain time before they can file a claim.

Disability Claim Denial & The Best Action Strategy

Most insurance companies do not divulge specific information about the status of disability claims to the public. But it is no secret that most claims for long-term disability benefits in Canada are not accepted. According to the legal process, the insurance provider must provide the policyholder with a written rejection of their disability claim.

The rejection contains the exact reason policyholders are denied long-term disability benefits. Policyholders can appeal the insurance company’s decision if they believe their claim was wrongfully denied. Such policyholders must provide additional documentation to support their justification.

How Much Disability Benefits Can You Get In Nova Scotia?

Permanent employees can get monthly disability benefits equal to 70% of their gross monthly salary. The long-term disability benefits continue until any of these stipulations applies:

• You regain your health and recover from the disability. Now you can continue working
• You are 65 years of age
• You are 60 years or older with 30 years of pensionable service in the Nova Scotia Health Employees’ Pension Plan
• You decide to take an early retirement based on the Nova Scotia Health Employees’ Pension Plan
• The policy expires

Always consult your insurance provider to get pertinent information regarding your policy.

Consulting Professional Disability Claims Advisors In Halifax

Policyholders that punctually pay their premiums each month may not be aware of all the intricacies of a long-term disability claim. McIver Insurance has qualified disability claim advisors in Halifax, Nova Scotia to help steer your disability claim in the right direction. With their expertise, you can increase your chances of getting your long-term disability claim approved.