How to minimize health-care expenses
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How to minimize health-care expenses

Author: Sound Choices

November 1, 2018

Health-care planning:
What you need to know to claim these expenses

The content in the below article is meant for Canadian investors only.

The claims for medical expenses incurred for travel and modifying your home can be quite lucrative, but you’ll need to know what documentation to keep, because these are two areas that can attract the tax auditor.

Here’s what you need to know:

Travel Expenses for Medical Reasons

Taxpayers who must travel 40 km or more to receive medical services not available in their community can claim the cost of such travel as the patient, and for one attendant. If the taxpayer is required to travel more than 80 km from their place of residence, then travel expenses may also include hotel and meal costs. Actual receipts can be used for costs of travel, including gas, hotel and meals.

Alternatively, vehicle expenses can be claimed using a simplified method based on a rate per kilometre. This method does not require receipts to be kept for vehicle expenses, only a record of the number of kilometres driven. Interesting tax trivia: if more than one province is involved, the rate is calculated based on the province in which the trip began.

Home Modifications as Medical Expenses

These expenses may be quite substantial as well, so keep receipts, and make sure you can show that these costs were as a result of prescription by a medical practitioner. Here are some examples:

  • Home Modifications. Incremental costs of building a new home, or modifying an existing home, qualify for a patient who is physically impaired or lacks normal physical development, where those costs are incurred to enable the patient to gain access to, or be functional within, the home. However, the expenditure must not be of a type simply intended to increase the value of the home, or an expense that would not typically be incurred by someone who was not impaired.
  • Driveway Alterations. If a person with a mobility impairment alters the driveway of their residence to facilitate access to a bus, those costs can be claimed.
  • Moving Expenses. For a disabled person to move to a more suitable dwelling, these expenses are also eligible, to a maximum of $2,000.
  • Van Adaptations. An individual who requires a wheelchair can claim the lesser of $5,000 or 20 percent of the cost of modifying a van for the purposes of accessibility.

RRSP Opportunities 

Remember, the disabled become “first time” homebuyers for the purposes of the RRSP Home Buyer Plan if they have to purchase alternative accommodations as a result of their disability. This will allow the family to tap into funds tax-free if they have to move from a two-story house to a bungalow, for example, to accommodate the needs of the disabled person.


When in doubt, consult with a tax specialist. This is a wise move that can unlock the door to new money to help pay for some of these expensive costs of lifecycle change.

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The information contained in this article is based on material believed to be reliable and is provided as a general source of information, based on information available as of October 16, 2018 and should not be considered any personal investment or tax advice. The information provided has been created and vetted by The Knowledge Bureau Inc. Every effort has been made to ensure accuracy at the time of publication, however AGF Management Ltd. and its affiliates cannot guarantee 100% accuracy of this information, and is not responsible for the development and creation of this material. It is important for investors to consult with their financial and tax advisors before making any investment or tax planning decisions. 
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