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CRA Benefits & Back Pay
After approval there are three benefits to request:
Disability Amount (DTC) - tax reduction
Canada Caregiver Credit (CCC) - tax reduction
Child Disability Benefit - tax benefit paid monthly
For further details on the differences, please view this related article.
1. Disability Amount (DTC)
You can have your prior tax returns reassessed to include this credit retroactively going back to the date of approval (maximum of ten years back).
If you checked the box on the form that asks if you would like your taxes to be automatically reassessed, you don’t need to do anything. The CRA will do this automatically.
You CAN adjust your taxes yourself - but ensure that you have an understanding of how to do this.
The credits will first be applied to the returns of the claimant listed on the T2201 application. You can request that any remaining credits be transferred to a spouse or caregiver once the tax reassessments have been completed.
Transferring DTC Credits to Spouse
If you did not indicate the higher earner in your household as the person who is claiming the disability amount, you can write a letter to have the unused credits applied to that person. You do not need to request the entire DTC approval be transferred to your spouse.
If you had no income, the unused credits that would be transferred would be the full credit amount.
You can submit this request through your online account.
2. Canada Caregiver Credit (CCC)
AFTER receiving your tax reassessments for the DTC, you can request this credit. Note that you will only see a refund if there are still taxes paid after applying the DTC amount.
You need to write a simple request to have them reassess your taxes to include the Canada Caregiver Credit or equivalent, to the applicable years you’ve been approved for.
We recommend waiting until after application of the DTC as this is a smaller credit and requesting it before will potentially delay the reassessment for the DTC, which is typically a larger refund.
3. Child Disability Benefit
The CDB is added to the Canada Child Benefit (CCB) and paid together as one deposit monthly.
After approval, you do not need to request this amount. It will be applied automatically going forward.
The benefit can be back paid retroactively from the time of approval to a maximum of 10 tax years (NOT CALENDAR YEARS). The retroactive pay is calculated in two stages:
Automatic Portion - The first payment for 2 tax years, plus the current tax year is automatically calculated and paid with your CCB. You will generally see this within 2 months of approval.
If you have been approved from further back than 2 years + the current year, you can request the additional months of benefit. You must send a letter to the CRA to receive this.
Requests to Reconsider Approval Dates
You CANNOT ask to be paid from birth if you were not approved from birth (or if birth was more than ten years back). If you wish to try to have the approval dates modified, follow the information in this article.
Timelines
It can take several months to a year or more to receive payment from your tax reassessments.
Payment for the CDB is usually quicker, with full payment within 2-3 (or four) months.
If you're looking for more information, our FB group is a great resource. Join us, here.
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