Turn Medical Expenses Into Lemonade

Do you have medical expenses? Wondering if you can use them to reduce your tax owing? CRA has a long list to specify which medical expenses can be claimed on your tax return. Some examples of medical expenses that you cannot deduct are diaper services, non-prescription services, cosmetic surgery, vitamins and gym fees. If you are unsure, the best bet is to keep the receipt and check with us at tax time.

Maybe you did not know about the medical expense last tax season and you encountered the bulk of your medical costs between November and February ending in the tax year. The good news is that the timing for medical expenses does not have to be the same as the calendar year. However, the twelve months we choose to capture in one tax year has to end in that tax year. So, if we are filing your 2020 taxes, you must have paid for the medical expenses during a 12-month period that ends in 2020.

The timing becomes also important when we consider how much your total medical expenses cost you. The rule is that in order to claim medical expenses, they must total 3% of your net income (or $2,352 – whichever is less). One person per household (spouse and dependants) should claim the medical expenses.

Do you have more questions? We would love to chat.