QUESTION:
My mother is going into a private long-term care facility and I will be paying about two thirds of the total cost. Can I include my portion as a medical expense on my tax return?
ANSWER:
You may be able to claim the medical portion of your mother’s long-term care expenses as a non-refundable tax credit on your tax return if your mother qualifies as your dependent and has the required medical documentation.
Dependent Eligibility
A parent (or other family member*) may only be considered a dependent for tax purposes if you have supported them with ‘the basic necessities of life’ (such as food, shelter and clothing) on a regular and consistent basis.
If they live with you and solely rely you on for support, they would ordinarily be considered a dependent. However, in many situations, it is a question of fact (presented evidence) if a parent is considered to be a dependent for tax purposes. The fact you have to pay most of the long-term care cost for a parent may suggest that they are dependent on you for support, but you may also need to prove that your parent’s own income is insufficient to cover the cost of their long-term care and consequently they are not able to meet their basic necessities of life on their own.
*Note: only the following family members are eligible to qualify as “other dependents”:
- your or your spouse or common-law partner’s children who were 18 years of age or older at the end of the tax year, or grandchildren
- your or your spouse or common-law partner’s parents, grandparents, brothers, sisters, uncles, aunts, nephews, or nieces who were residents of Canada at any time in the year
If your parent is not an eligible dependent, you are unable to claim any of your costs related to their long-term care expenses on your personal tax return.
Your parent however may be able to claim the ‘medical portion’ of their long-term care on their own tax return.
Documentation Required
Regardless of who is making the claim, the supporting documentation will vary based on the type of claim being made. But essentially there are two key documents required to claim long-term care expenses:
- A completed Disability Tax Credit (DTC) Certificate (Form T2201) certifying the parent has a severe and prolonged impairment in physical or mental function (this form must be approved by the CRA) OR,
Written certification from a medical practitioner that states that by reason of a lack of normal capacity, the parent is currently and in the foreseeable future depending on others for personal needs and care.
If a claim is made and your parent is not eligible for the DTC and/or does not have an appropriate letter from their doctor, the medical expenses will be denied and the return will be reassessed with taxes (and possibly interest charges) most likely owing.
- In order to claim attendant care expenses, you may also need to provide the CRA with a detailed receipt from the facility to support the amount paid. The receipt must provide the name of the patient and a detailed breakdown of the facility expenses. You must also include any subsidies not included in income that reduce the attendant care expenses.
Eligible Expenses
Cost of full-time care provided in a nursing home:
Generally, if your parent has a CRA-approved DTC Certificate or letter from a qualified medical practitioner and is in a nursing home to receive full-time medical care, all regular fees can be claimed as eligible medical expenses, including fees for all of the following:
- food
- accommodation
- nursing care
- administration fees
- maintenance fees
- social programming and activities fees
However, extra personal expenses (such as hairdresser fees) are generally not eligible.
In this situation the taxpayer can claim either the cost for full-time care in a nursing home or the disability tax credit, but not both.
Note: a nursing home is a facility that provides full-time attendant care to individuals who are unable to care for themselves.
Remuneration for part-time attendant care:
If your parent has a CRA-approved DTC Certificate and is in a retirement home or long-term care facility that provides part-time attendant care, the costs for attendant care up to a maximum of $10,000* ($20,000 in the year of death) can be claimed as eligible medical expenses. The disability tax credit can also be claimed.
Long-term care expenses that can be claimed as medical expenses:
The salaries and wages (to certain limits) paid to all employees who do the following tasks or services can be claimed:
- 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) if included in the monthly fee
- transportation (driver)
- security for a secured unit
Long-term care expenses that cannot be claimed as medical expenses:
You cannot claim the cost of any of the following:
- 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
*Note: For residents of Ontario, the provincial limit for 2024 is $17,147 for these expenses ($34,293 if the person died in the year).
For more information please visit the CRA website.
As the rules for claiming attendant care costs are quite complex, we strongly recommend that you speak with a tax professional.
S+C Partners is here to help you.
Please contact us at 905-821-9215 or tax@scpllp.com if you have any questions. If you are in a position where you may be funding or partially funding a dependent’s long-term care, our dedicated team of tax professionals can provide guidance on how to do so in the most tax-efficient way.
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