DISABILITY ADVISORY COMMITTEE Enabling access to ... Disability Advisory Committee The Disability Advisory

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  • Enabling access to disability tax measures

    FIRST ANNUAL REPORT OF THE DISABILITY ADVISORY COMMITTEE2019

  • This report is dedicated to Wendall Nicholas, for his commitment and leadership as a member of the Disability Advisory Committee.

  • Table of contents

    Introduction ...............................................................................................01

    Disability Advisory Committee ..................................................................01

    Committee membership ............................................................................01

    Committee mandate .................................................................................01

    Committee work ......................................................................................02

    Committee proposals ................................................................................02

    Section 1 – Understanding disability tax measures ......................................04

    Disability tax credit (DTC) .......................................................................04

    DTC eligibility criteria ..............................................................................06

    Section 2 – Enabling DTC access through improved eligibility criteria ............. 07

    Introduction ............................................................................................07

    Definition of mental functions ...................................................................08

    Marked restriction and the 90% guideline ................................................14

    Parity between physical and mental functions ............................................20

    Life-sustaining therapy .............................................................................22

    Designated conditions ...............................................................................24

    Section 3 – Enabling DTC access through improved application procedures ...............................................................................28

    Health provider roles ................................................................................29 Health providers as gatekeepers ....................................................................................29

    When tax preparers/promoters and health providers disagree on eligibility ......................29

    When health providers may not have the information base necessary to completing Form T2201 on behalf of applicants ........................................................30

    When an applicant has more than one severe and prolonged impairment in an activity of daily living ...............................................................................................31

    Expanding the list of health providers qualified to complete Form T2201 ........................31

    Costs of completing Form T2201 ..............................................................33

    Clarity of Form T2201 .............................................................................33

  • Layout of Form T2201 .............................................................................36

    Clarification letters ..................................................................................37 Purpose of the clarification letter ..................................................................................37

    Substance of the clarification letter ...............................................................................39

    Challenge to professional competence ...........................................................................39

    Losing eligibility ..........................................................................................................40

    Time and cost involved in completing a request ..............................................................41

    Lack of transparency ....................................................................................................41

    Request a review / Appeal a decision .........................................................43

    Quality assurance framework ....................................................................46

    Section 4 – Enabling access through improved communications ........................... 48

    Raising awareness ....................................................................................48

    Improving transparency ............................................................................50

    Providing clear information ......................................................................50

    Clarifying the criteria ...............................................................................51

    Improving client contact ...........................................................................53

    Providing personal assistance ...................................................................54

    Section 5 – Enhancing access to other disability benefits ............................56

    The role of the disability tax credit has expanded over time ........................56

    Access to a registered disability savings plan (RDSP) ................................57

    Repayment of RDSP grants and bonds ......................................................57

    Access to the child disability benefit ..........................................................59

    Access to disability programs and benefits .................................................60

    Larger questions about the DTC ...............................................................61

    Section 6 – Recognizing the additional costs of disability ...........................62

    Disability tax credit ..................................................................................62 Costs related to DTC procedures ...................................................................................62

    Costs related to Form T2201 ........................................................................................63

    Extraordinary costs .....................................................................................................64

    DTC refundability ........................................................................................................64

    Medical expenses tax credit ......................................................................66

    Disability supports deduction ....................................................................67

  • Appendix 1 – List of Committee Members ..................................................69

    Appendix 2 – Recommendations .................................................................70

    Appendix 3 – Disability Advisory Committee Terms of Reference .................77

    Appendix 4 – List of Organizations We Heard From ....................................82

    Appendix 5 – Health Providers Survey ........................................................83

    Appendix 6 – Financial Advisors and Tax Preparers Survey .........................88

    Appendix 7 – Description of Federal Measures for Persons With Disabilities .................................................91

    Appendix 8 – Disability Measures Linked to DTC Eligibility ........................96

    Appendix 9 – Form T2201 ..........................................................................97

    Appendix 10 – DTC Data for Mental Functions .........................................104

    Appendix 11 – RDSP Concerns ................................................................105

    Appendix 12 – Questions for DTC Refundability Conference Call ...............107

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    01

    Introduction

    1 The findings and recommendations put forward in this report are those of the Disability Advisory Committee, and do not necessarily reflect the views of Mr. Vermaeten as the Committee’s co-chair or of the Canada Revenue Agency.

    Disability Advisory Committee The Disability Advisory Committee was originally formed in March 2005 after the Technical Advisory Committee (TAC) on Tax Measures for Persons with Disabilities had completed its mandated work and released its report Disability Tax Fairness in 2004. The Committee subsequently was disbanded in 2006. Because of increased attention to the disability tax credit (DTC) and its administration, the Honourable Diane Lebouthillier, Minister of National Revenue, announced the reinstatement of the Committee in November 2017.

    The Minister of National Revenue and the Canada Revenue Agency (CRA) are committed to ensuring that all Canadians receive the tax credits and benefits to which they are entitled. The Committee is a forum that enables CRA officials to come together with stakeholders to better incorporate the views of Canadians with disabilities into the Agency’s decision making and procedures.

    Committee members are providing their insights on ways to improve access to various tax measures for Canadians with disabilities. Enhancing the accessibility of CRA services to persons with disabilities is an ongoing effort, which has been assisted by the Committee’s work.

    Committee membership The