8 March 1995 Internal T.I. 9428617 - DISABILITY TAX CREDIT AND CHRONIC CARE IN HOSPITAL

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 Department.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.

Principal Issues:

whether disability tax credit denied where an amount has been paid to a hospital

Position TAKEN:

118.3(1)(c) denied a disability tax credit if there is an amount in respect of remuneration for an attendant or care in a nursing home is claimed under 118.2 (otherwise than by 118.2(2)(b.1)). An amount paid to a hospital under 118.2(2)(a) will not preclude a claim for the disability tax credit

Reasons FOR POSITION TAKEN:

			March 8, 1995

	Ottawa Tax Centre	Head Office
	Enquiries & Adjustments	Rulings Directorate
		Sandra Short
	Attention:  Deborah Dube	(613) 957-8953

		942861

118. 2(2) and 118.3 of the Income Tax Act

This is in reply to your enquiry of November 4, 1994 concerning the 1985 through 1993 income tax returns for XXXXXXXXXX You have asked whether the client is entitled to claim a disability tax credit in the same years that an amount has been paid to a hospital. The amounts paid to the hospital represent the cost to the patient for continuing chronic care in a semi-private room.

Paragraph 118.3(1)(c) of the Act denies a disability tax credit where an amount in respect of remuneration for an attendant or care in a nursing home, in respect of the individual, has been included in calculating a deduction under section 118.2 (otherwise than because of paragraph 118.2(2)(b.1)) for the year by the individual or by any other person. Provided the relevant requirements of section 118.3 of the Act are otherwise met, a disability tax credit is not denied where an amount has been included in calculating a deduction under section 118.2 where the medical expense is of the type permitted by paragraph 118.2(2)(a) of the Act. Hospital fees charged for the provision of continuing chronic care in a semi-private room qualify as a medical expense under paragraph 118.2(2)(a) of the Act. We have assumed that the hospital fees have not been reimbursed by a plan of insurance.

We reviewed the documentation forwarded to you and it would appear, at least at the time that the court order was rendered, that the client ordinarily resided in a nursing home (XXXXXXXXXX). If an amount has been claimed as a medical expense in respect of care in the nursing home in any of the years in question then no disability tax credit could be claimed in that year or years.

P.D. Fuoco
Section Chief
Personal and General Section
Business and General Division
Rulings Directorate
Policy and Legislation Branch