Disability advocates are welcoming promised changes to the Disability Tax Credit announced this week, but say more reforms are needed.
This week’s spring economic update promises to simplify Disability Tax Credit applications for individuals with specific medical conditions. It will also allow a broader range of medical professionals to certify Disability Tax Credit applications in specific cases.
These announcements please researchers and advocates who have long called for reform to the tax credit.
“The changes are … a good move forward,” said Gillian Petit, a research associate at the University of Calgary who focuses on income support programs, including disability supports.
“But they only really scratch the surface of what can be done to remove barriers to the Disability Tax Credit.”
Shortened applications
The Disability Tax Credit reduces the amount of income tax owed by people with severe mental or physical disabilities, or relatives who care for them.
In 2025, the credit was worth $10,138 for adults. The credit is non-refundable, which means only those with taxable income financially benefit from it.
The changes proposed Tuesday will simplify the benefit’s application process, allowing more people to receive it.
Under the new proposal, doctors will no longer need to fill out a lengthy form for individuals diagnosed with specific conditions and disabilities such as dementia, ALS, Down Syndrome and some autism.
Doctors will only need to confirm the diagnosis, not the impact on someone’s daily activities. This change, if passed, would take effect for the 2026 tax year.
Occupational therapists, physiotherapists and speech-language pathologists will also now be permitted to fill out more parts of the medical forms in the Disability Tax Credit application. This change, if passed, will apply to credit certifications approved after 2026 for tax year 2027 and beyond.
Advocates say these are important changes because most people with disabilities do not currently receive the Disability Tax Credit. A recent report by Petit suggests the number is as high as 84 per cent.
Approval for the Disability Tax Credit is also required to access various other government benefits, including the Canada Disability Benefit, the Child Disability Plan and the Registered Disability Savings Plan.
The government estimates the changes will result in people receiving $345-million more in federal benefits over the next five years.
Jill Teeple, executive director of Partners for Planning, says these changes will reduce the stress many individuals and families face when applying for the Disability Tax Credit. Her non-profit helps people with disabilities and their families with financial planning.
Often, children with disabilities are given conditional certificates for the Disability Tax Credit, which can mean they must re-apply when they turn 18. The proposed change will mean children with certain diagnoses only have to complete the application once.
“If we can reduce some of that friction for families, that’s a really big deal,” she said.
Dr. Margot Burnell, the president of the Canadian Medical Association, says allowing more types of medical professionals to certify forms will reduce the burden on family doctors. This will allow patients to get better care, she says.
Episodic disabilities excluded
Not everyone benefits from the changes, however. Many people will still require doctors to fill out lengthy forms because their diagnoses do not qualify them for a shortened application.
“[The proposal is] a big step for individuals who fall in [the listed] categories [of conditions], not super helpful to individuals who don’t,” said Jennifer Zwicker, a professor at the University of Calgary and co-chair of the Canada Revenue Agency’s Disability Advisory Committee.
People whose disabilities change frequently often struggle to be eligible for the Disability Tax Credit.
Julie Kelndorfer, director of government relations and advocacy for the MS Canada, notes the proposed changes do not address the needs of people with episodic disabilities that fluctuate over time.
The charity will continue advocating for people with episodic disabilities to qualify for the Disability Tax Credit, Kelndorfer told Canadians Affairs in an email.
Future changes urged
Krista Carr, CEO of Inclusion Canada, opposes the Disability Tax Credit being the “gateway” to all the other federal benefits.
But if it has that role, it needs “transformational reform,” she said.
The Disability Tax Credit is used as a poverty reduction measure, even though that was not what it was intended to do, says Zwicker.
“There’s a lot of weight being placed on the Disability Tax Credit,” she said.
Some hope Ottawa’s announced changes show it will further improve the Disability Tax Credit.
“There’s room for the government to move the needle towards further disability policy reform,” said Cynthia Minh, director of national programs at Disability Alliance BC, a charity that helps people apply for disability benefits.
“I see this as an opportunity to look further into other ways that we can make the Disability Tax Credit more inclusive and more reflective of the disability lived experience.”
For her part, Minh would like eligibility criteria for the tax credit to be expanded and not dependent on medical forms.
Petit, at the University of Calgary, says that people who receive provincial or territorial disability benefits should automatically qualify for the Disability Tax Credit.
Teeple, at Partners for Planning, says more work is needed, but she is more encouraged about the Disability Tax Credit than she has been in a while.
“This has been the most meaningful reform we’ve seen for the Disability Tax Credit and the most attention we’ve really seen by government in a long, long time,” she said.
