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Questions about appealing a denial have popped up a lot lately. I have been intending to write a guide for what to do when denied but have not had time. This document will be a quick and rough guide that will hopefully help until I can write a better one.
The Word “Appeal”
When it comes to the Disability Tax Credit process, the word “appeal” does not actually mean anything. CRA does not use the term which is where some confusion is coming into play.
You have three options when denied:
Request for Reconsideration (sending additional information),
Formal Dispute or
Reapply.
1. REQUEST FOR RECONSIDERATION
This should be the option people choose MOST of the time.
You have 12 months to provide “additional information” and request they review your application. They are NOT looking for reports or they would have sent the doctor a letter requesting supporting documentation (see more about reports below).
9/10 times the denial was due to IMPROPER WORDING in the “Effects of Impairment” section. The additional information you need to provide is a properly worded rewrite of the EOI. It must be written and signed by your doctor. NOTE: It cannot be a letter from a parent explaining their daily struggles - this may have helped at some point in the past, but it no longer does. (You, or a third party (such as myself) can write it for the doctor to use as long as it is accurate and written in the third person and your doctor agrees to sign it.
For example:
“Tommy is a 4-year-old boy who cannot dress himself as his fine motor skills are impaired, he cannot pull on clothing or manage any fasteners and requires a caregiver dress him.”
NOT
“Tommy can’t dress himself because he has poor fine motor skills, we must dress him all of the time.”
The “Request for Reconsideration” should start off something like this:
To: Canada Revenue Agency
RE: DTC Denial (name of patient); request for reconsideration
Dear Sir or Madam,
Please accept this additional information regarding the Disability Tax Credit for________. _________’s application was recently rejected. It is my hope you will review this information and overturn your decision. ________ is affected by these impairments 90% or more of the time, in all settings, despite appropriate treatments and therapies.
As indicated on the original T2201, _________ is a nearly ___-year-old girl who has . . . (continue with mentioning the diagnosis and describing the effects of impairment). (if no diagnosis just description of EOI)
2. FORMAL DISPUTES
Formal disputes or objections should be a LAST RESORT ONLY when all other avenues have been exhausted.
You have 90 days to provide all relevant documentation; this documentation IS copies of reports and there also should be a rewrite of the EOI as described above.
You must file a formal dispute online through your account.
Once a formal dispute is filed, a caseworker will be assigned to look into whether the CRA legally applied the criteria to the case when making their determination.
This process can take many months. Tax court becomes a possibility when you file a formal dispute.
There is no advantage to a formal dispute (unless all other avenues have failed and you are ready to fight back).
A formal dispute may be more difficult to overturn because the CRA MAY review your documentation; OFTEN documentation can hurt a case rather than help it.
WHAT IS THE REAL DIFFERENCE?
(other than processing time and who does the review)
A request for reconsideration is sending information to clarify the Effects of Impairments; they will add it to the original application and consider reversing their decision a formal dispute is objecting to their decision-making process; they will review the case and relevant information and decide whether or not they applied the criteria legally.
3. NEW APPLICATION
This is the best choice for completely botched first applications.
At times, an original application is just done wrong technically.
For example:
The doctor may have checked off the wrong impairments such as checking “dressing” as a marked restriction for a child who can’t focus due to ADHD.
In this case, dressing would be addressed under mental functioning as the criteria for dressing must be physical in nature.
They may have indicated the wrong date, such as a doctor indicating the effects of impairment began the year of diagnosis, rather than when the impairments began to manifest.
A new application will take about the same amount of time as the original application-if mailed or uploaded as a new application.
HOWEVER, you can turn a new application into additional information by having your doctor write a cover letter stating the new application is being sent AS additional information to make technical corrections, to clarify the Effects of Impairment section, and to request a reconsideration.
You would upload the new application and cover letter to your account using the REFERENCE NUMBER from your letter of denial.
Example:
To whom it may concern,
Please accept this new application as additional information for_______________.
He was recently denied the Disability Tax Credit which is believed to be due to insufficient detail in the “Effects of Impairment” section. There were also technical errors related to appropriate dates and appropriately indicated impairments. These have been corrected on the new T2201 form.
Thank you,
As always, if you are in this situation and feel overwhelmed with the process, we can do it for you for a nominal fee. Sign up for a free client portal account to get started.
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