Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.
Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CCRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ADRC.
Principal Issues: Can a medical doctor certify that an individual, who dies prior to having been disabled for a period of 12 months, qualifies for the disability tax credit after the individual has died?
Position: Certification will be accepted only if it is based on a prognosis made before the individual's death.
Reasons: Certification meets the requirements of paragraph 118.3(1)(a.2) if a qualified person made the prognosis before the individual dies and the impairment could reasonably be expected to last for a period of 12 months.
XXXXXXXXXX 2002-015118
Shaun Harkin, CMA
September 24, 2002
Dear XXXXXXXXXX:
Re: Disability Tax Credit: Certification Requirement
This is in reply to your letter of July 5, 2002, regarding the credit for mental or physical impairment (hereinafter referred to as the "disability tax credit").
Your particular concern is whether a medical doctor could certify, after an individual has deceased, that the individual had a severe and prolonged impairment that was expected to last for a continuous period of at least 12 months, where the impairment actually lasted for a period of less than twelve continuous months.
Written confirmation of the consequences inherent in particular transactions are given by this directorate only where the transactions are proposed and are the subject matter of an advance ruling request submitted in the manner set out in Information Circular 70-6R5. If, however, the particular transactions are partially completed or completed, the enquiry should be addressed to the relevant Tax Services Office. Notwithstanding the foregoing, we are providing the following comments.
In order for an individual to qualify for the disability tax credit, an appropriately qualified person (usually a medical doctor) must certify that the individual has a severe and prolonged mental or physical impairment the effects of which markedly restrict the individual's ability to perform the basic activities of daily living as defined in the Income Tax Act (the "Act"). Paragraph 118.4(1)(a) of the Act states that, "an impairment is prolonged where it has lasted, or can reasonably be expected to last, for a continuous period of at least 12 months".
We have reconsidered our position stated in our letter of March 27, 1998 (9803265) and in our letter to you of June 25, 2002 (2002-013462). We agree that an individual need not be alive at the end of the year to qualify for the disability tax credit and that, in determining if the impairment can reasonably be expected to last for a continuous period of at least 12 months, the test is to be applied at the time the disability was diagnosed by a qualified person.
Consequently, if an individual dies before his or her severe impairment has lasted a period of twelve continuous months and the individual had not obtained a certification from a qualified person, a certificate may be completed after death if it based on a prognosis, made by an appropriately qualified person before the individual died, that the individual's severe impairment was reasonably expected to last for a continuous period of at least twelve months. In these circumstances, the disability tax credit would be available to the individual despite his or her death having occurred within the twelve-month period.
The foregoing comments represent our general views with respect to the subject matter. As indicated in paragraph 22 of Information Circular 70-6R5, the above comments do not constitute an income tax ruling and accordingly are not binding on the Canada Customs and Revenue Agency. Our practice is to make this disclaimer in all instances in which we provide an opinion.
We trust the above comments are of assistance.
Yours truly,
Daryl Boychuk, LL.B
Section Manager
Partnerships Section
Business and Partnerships Division
Income Tax Rulings Directorate
Policy and Legislation Branch
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