Are you confused about claiming attendant care costs?

If you're confused about what changed about personal tax credits, when it comes to the $10,000 join the crowd...you have reasons to be confused.

Not only is there a rule that says that if you claim the DTC and up to $10,000 of attendant care costs, you can't claim in the same year for other types of attendant or nursing or group home care. It's one or the other but not both in the same year...so it's necessary to perform what if calculations for which is the optimal claim, but you aren't going to be able to claim, in a year of transition from attendant care to nursing home care, the entire cost of care. Not possible.

What changed is that the limit on claiming medical expenses for a dependent over 18 was $10,000 and now it's limitless as of 2011.

Well, that's only partially true. There are limits, also $10,000, found in the medical expenses S. 118.2(2)(b.1). If you're paying medical expenses for attendant care and the patient does qualify for the disability tax credit claim, it's possible to claim the DTC and up to $10,000 of attendant care. Those expenses are limited to $10,000 for the individual (if you read the Income Tax Act, S. 118.2(2)(b.1) says the limit is $10,000 or $20,000 in the year of death of the individual, which when you go backwards to the definition of individual, that's not really the patient, for whom the medical expenses are being paid, but the person making the claim for those paying those expenses, which is really confusing.

For anyone who's overly paranoid, this will fuel your paranoia. I once had a discussion with a senior finance officer in Rulings who told me that they have chosen to ignore that the ITA says, and go with it's the patient, not the individual claiming for whom this rule applies. They also ignore that it says that if you pay one penny more than $10,000 that you can't claim anything. They've chosen administratively to ignore that the ITA doesn't say what they want it to say. One does wonder how long this will continue to be the case.

To further compound your anxiety about how to apply the ITA when claiming for attendant care costs, the BC Gov't has stated in a letter to care homes that they pay the cost of care when it's a funded bed, and the 80% the tenants pay, that's supposedly not medical expenses, as those are covered by the gov't. They claim what you are paying is the rent and the non medical costs of living expenses, which means you really may not have a claim for medical expenses at all.

If you are a BC care facility, I'd be talking to a lawyer about an opinion on issuing receipts claiming that your tenants are paying attendant care costs when the gov't is saying they paid for that, and that your tenants are only paying rent.