Starting in 2025, the Canada Revenue Agency (CRA) Disability Tax Credit (DTC) will assist Canadians with serious and long-term disabilities and disabilities with extra expenses in making life more affordable. This document clarify benefits, claims and payment schedules with straightforward and practical frequently asked questions and a summary table for fast reference.
What Is the Disability Tax Credit?
The Disability Tax Credit is a non-refundable and federally funded tax credit meant for individuals with serious and long-term disabilities or for their supportive relatives to lessen the amount of tax to be paid. This credit is not paid in a refund of cash. It is meant to lessen the tax liability to be paid each year therefore providing additional income for not-so-essentials. For 2025, children under 18 years will be able to claim $15,630 which includes a disability amount, while adults will be able to claim $9,872.
Who qualifies in 2025?
Eligible individuals will have to suffer for more than 12 months with a physically or mentally severe impairment which must be long-term and must relieve the individual of basic functions of life that include self-care, communication, mobility, and cognitive which include thinking. This includes but is not limited to chronic illness, mental disorder, developmental delay, and sensory disability or impairment. This must be corroborated with a T2201 form completed by a medical professional.
How to Apply: Step-by-Step
To begin the process of applying for the DTC, the first step involves going to the CRA website and downloading Form T2201. After completing the form, it can be submitted online or sent to the CRA by mail, provided a medical professional has confirmed the form with the necessary disability impact certification. After this step, the DTC can be claimed once a year for the duration of a disability. Tax credits for DTC can be claimed for each year passed. A person can claim this tax credit for a maximum of 10 preceding years. This may result in substantial benefits if all preceding years are claimed.
Payment Dates and the New Benefit
The DTC does function in part as a tax credit, but the Canada Disability Benefit and it’s new monthly payments for DTC holders are incentives meant for low income households with a DTC approved status. New benefits for low-income households with approved DTC status come in the form of $200 monthly payments, starting July 2025. Payments of this Benefit, as well as the Canada Disability Benefit, are spaced to be received from the 5th to the 10th of each month to coincide with other federal benefits, assisting households with payments and budgeting.
Benefit Amounts: 2025 Update
The federal DTC for claimable amounts has some changes. For the 2025 taxation year, under the age of 18, the DTC claimable amount is $15,630 and for adults, the claimable amount is $9,872. This amount complements the Canada Disability Benefit, which adds $2,400 a year to their total benefits, and will aid people who are fully or partially impacted by tax credits. A person with a disability who does not owe taxes can transfer the claimable amounts to their supporting relatives.
Very Short Table of Key Data
| Category | Amount/Details |
|---|---|
| Adult Credit | $9,872 (tax credit) |
| Child Credit | $15,630 (tax credit) |
| Benefit Start | July 2025 (monthly) |
| Monthly Benefit | $200 |
| Application Form | T2201 |
| Retroactive | Up to 10 years |
FAQs
Q1: Can family members claim the DTC for a relative?
If a disabled relative has little or no taxable income, supporting family members can claim the credit.
Q2: How long does approval take?
Approval largely depends on the pieces of paperwork submitted and the processing time at the CRA, which can take weeks or even months.
Q3: Can DTC claims be made retroactively?
Absolutely, claims can be submitted for the previous 10 years, which can provide a considerable amount of money for the claimant.
