Disability Therapy

Is disability therapy CRA eligible in Canada?

Conditionally. Remuneration paid for therapy may be an eligible medical expense under paragraph 118.2(2)(l.9) of the Income Tax Act, as discussed in paragraph 1.115 of Income Tax Folio S1-F1-C1. The therapy must be provided to a patient because of the patient's severe and prolonged impairment, and all of the following conditions must be met:

1. The patient is an eligible person with a disability for the tax year (T2201 required).
2. The therapy is prescribed by, and administered under the general supervision of, a medical doctor, nurse practitioner, or psychologist (for mental impairment), or a medical doctor, nurse practitioner, or occupational therapist (for physical impairment). Note: Nurse practitioner expenses under this provision are only eligible for amounts incurred after September 7, 2017.
3. The payee is neither the individual's spouse or common-law partner nor a person under 18 years of age.
4. Receipts include the payee's social insurance number where the payee is an individual.

Because a Health Spending Account reimburses CRA-eligible medical expenses, disability therapy that meets these conditions is eligible for HSA reimbursement.

What Qualifies

• Therapy sessions provided to an eligible person with a disability, prescribed and supervised by a physician or psychologist
• Physical therapy administered under the general supervision of a physician or occupational therapist for a severe physical impairment
• Behavioural therapy for a mental impairment under the supervision of a psychologist or physician
• This provision applies specifically to persons with a severe and prolonged mental or physical impairment — general therapy services are claimed under specific practitioner categories like psychotherapy, physiotherapy, etc.

What Does Not Qualify

• Therapy for persons who are not eligible persons with a disability for the year
• Therapy merely monitored by a medical practitioner rather than supervised — the CRA requires the practitioner to be actively directing the therapy plan
• Therapy provided by the individual's spouse or common-law partner, or by a person under 18 years of age

Good to Know

• Documents to keep: Receipts showing the payee's name and SIN (if the payee is an individual), dates of service, description of therapy, amount paid, and the prescribing practitioner's information. The T2201 must be approved by the CRA.

Frequently Asked Questions

Is disability therapy CRA eligible?

Conditionally. It qualifies under paragraph 118.2(2)(l.9) only when the patient holds a T2201 certificate, the therapy is prescribed and supervised by the appropriate medical practitioner, and the payee is not a related person under 18 or the individual's spouse.

Can I claim disability therapy through my HSA?

Yes, if all CRA conditions are met, disability therapy is reimbursable through a Health Spending Account.

Source

Based on the CRA's official eligible medical expenses list and Income Tax Folio S1-F1-C1, "Therapy for eligible person with a disability".