Breaking Down Barriers

June 27, 2018

The Senate Committee on Social Affairs, Science and Technology is urging the government to reform two of its principal support programs that are intended to give Canadians living with disabilities and their families tax relief and help them save for the future. 

"The Canada Revenue Agency was found to have applied the Disability Tax Credit (DTC) inequitably and unfairly," explained Senator Judith Seidman at the press conference held by the Senate Committee with the release of its report, Breaking Down Barriers, A critical analysis of the Disability Tax Credit and the Registered Disability Savings Plan. "Someone with a physical disability has an easier time qualifying for the credit than someone with a mental disability." She also noted that the deck is stacked against people living with episodic diseases such as multiple sclerosis.

There are serious systemic problems with the administration of the DTC along with built in barriers that are preventing people who should be entitled from actually receiving the tax credit. "The red tape, the lack of clarity and the lack of transparency is preventing Canadians with disabilities from accessing these programs at every level," added Kim Hanson, director of federal affairs for Diabetes Canada. (The health charity fought back when their members were facing an increased number of rejections that led to a reversal of a policy narrowing the eligibility criteria in May 2017.)

The Senate Committee also addressed a number of concerns related to the administration of the Registered Disability Savings Plan including the controversial claw-back of government contributions of bonds and grants if an individual has had to reapply for the DTC and found to be no longer eligible for either program. Individuals living with mental impairments are at higher risk of losing their RDSP since they are routinely asked to reapply for the DTC every three to five years even though their condition has remained unchanged. The Senate Committee has addressed this concern by recommending, "that the Minister of Finance revise Disability Tax Credit rules to better recognize the lifelong nature of certain physical and mental disabilities and eliminate the need for these people to reapply for the credit."

The report is based on the hearings held by the Senate Committee in February 2018 with advocacy groups representing people living with severe disabilities and the Minister of National Revenue, the Honourable Diane Lebouthillier along with the senior CRA staff.