As caregivers, life is continuously throwing us curveballs so it can be hard to stay on top of the programs, tax benefits, and caregiver financial support that is available, especially if someone were to get sick or have an accident.
As caregivers, life is continuously throwing us curveballs so it can be hard to stay on top of the programs, tax benefits, and caregiver financial support that is available.
Heather Haddon is a self-employed financial planner (CFP, CHS) who runs three successful businesses — financial planning, Heather Haddon Tax Prep, and SWAN Connection. She explains some of the options available when it comes to financial help for caregivers in Canada.
Caregiver tax benefits
Heather explains, “If the person you are caring for lives with you, you can work with your financial planner to claim various amounts on your annual taxes — similar to claims for dependent children. Your income comes off of these amounts. While they are not monthly benefits, they help to generate a tax refund.”
You may be eligible to:
- Claim an amount or an additional $2,093 on your taxes through the Family Caregiver Amount (FCA). The additional amount changes each year
- Claim the person’s medical expenses
- Claim rebates for any renovations you've made to your house
Canada pension plan disability/Quebec pension plan disability
This plan provides financial assistance to people who have been working up until the age of 60, but who are unable to work due to illness or disability. The CPP Disability Benefits are paid monthly to eligible applicants and their dependent children.
Disability tax credit (DTC)
The Disability Tax Credit is not age or income restricted. Similar to the Canada Pension Plan Disability, eligible conditions need to be severe and prolonged. Heather explains, “For example, Alzheimer’s or loss of other mental capacities - these are not going to get better. They will also become more expensive for caregivers.” Eligibility also doesn’t need to be for a condition that comes on later in life.
Heather recommends filling out the form early on. Depending on the medical condition, take the application form to your family doctor or health practitioner (e.g., optometrist, audiologist, occupational therapist, physiotherapist, psychologist, or speech/ language pathologist.) You may need to pay for this.
“It’s important to know that the application often gets denied the first time,” Heather cautions. “Don’t give up — you can appeal it, and it may get approved.”
Benefits can be retroactive to the year of diagnosis. Again, it is not a monthly credit, but it can provide a big annual refund on your taxes.
Compassionate care leave
Juggling work and caregiving is hard. You can receive compassionate care benefits up to a maximum of 26 weeks if you have to be away from work to provide care or support to a family member with a life threatening illness. If you are unemployed and already receiving EI benefits, you can also apply for compassionate care benefits. “This is an underused benefit right now,” says Heather. “But similar to EI, it can give you up to 60 per cent of your income.” To learn more about this benefit, you may want to read our article called Are you eligible for Compassionate Care Benefits?
Registered disability savings plans
A registered disability savings plan (RDSP) is a savings plan that is intended to help parents and others save for the long term financial security of a person who is eligible for the disability tax credit (DTC). Contributions can be made until the beneficiary turns 59.
“Government grants go with it, but this is a longer term proposition that you want to start younger; for example, supporting a child with Down syndrome or cystic fibrosis.”
Beyond government support programs
If your employer benefits include a disability plan, speak with your family doctor about a stress leave. Collecting benefits though your employer can mean the difference between keeping or quitting your job,” says Heather. Caregiver stress and burnout is real and a risk to your physical and mental health. “Stress leave is often needed and don’t be embarrassed to ask for it.” See our Elizz article on Caregiver Burnout.
No matter what stage of caregiving you may be in, it’s important to have a good financial planner. A professional financial planner will take a holistic look at your family’s entire situation and help you build a solid future.
To support family and friends with significant medical costs, many people have recently used online crowdfunding sites like GoFundMe. It’s a great platform to rally help, generate cash flow, and share updates. It’s also worth noting that GoFundMe collects a small percentage of the money raised, and is not a registered charity, and therefore does not provide a tax deduction.
If you have any further questions about how to navigate the system of caregiver financial assistance and government funding for caregivers, our Caregiver Coach will be happy to walk you through the process.