02/13/2015 09:29 EST | Updated 04/15/2015 05:59 EDT

How To Decipher the Criteria for Medical Expenses at Tax Time

Every province has their own set of rules, so it is easy to overlook medical expenses at tax time.

If you find yourself visiting B.C., you may want to consider seeing a Chinese medical practitioner while you are here because they are registered and receipts are considered a medical expense for tax purposes. But if you need to see a kinesiologist, only receipts from Ontario-based practitioners qualify as a medical expense.

Confused? You are not the only one. Every province has a different list of registered medical practitioners, it is hard to keep track of what qualifies and what doesn't. And you can see practitioners outside of the province and claim the receipt as long as they qualify.

So if you regularly see a massage therapist for treatment and plan to claim those costs, you have to see someone who is registered in British Columbia, New Brunswick, Newfoundland or Ontario. In B.C. and Ontario nutritionists are not recognized by the appropriate provincial authority, but both provinces have registered traditional Chinese medicine practitioners, so you can claim the cost of seeing one of them.

The reason it is important to know what qualifies as a medical expense is the higher your expenses, the more likely that you can make a claim. Medical expenses must exceed three per cent of your income in order to provide a credit on your return. So if you earn $30,000 per year, you need to have at least $900 in medical receipts to receive a credit.

Usually, you claim medical expenses for the calendar year. But you are allowed to claim your best 12 months of medical expenses if that helps with your tax savings, as long as one of the months is in the tax year. So if you had two major dental bills and one was November 2013 and the other was May 2014, you could claim November 2013 to October 2014 on your 2014 tax return to make sure you get credit for both of your dental.

If you live in an area where you have to travel to see specialists or go to the hospital, you are allowed to claim expenses for the travel, but it depends on how far you have to go. If you travel more than 40 but less than 80 kilometres to receive the treatment, you are able to claim the mileage on your return. If you have to travel more than 80 kilometres to receive medical services unavailable at a closer location, you can also claim accommodations, meals and parking. Depending on your condition, you may also be able to claim expenses for a companion to help support you.

Beyond alternative healthcare practitioners and travel expenses, there are other obscure medical expenses that can help contribute to your year's total. Hearing aid batteries, the incremental cost of gluten-free foods, and even wigs can be claimed if you meet the criteria. Extended healthcare premiums you pay through your employer are a medical expense, as well as any deductibles the plan requires you to pay. You can usually find the amounts on your paystub or in your employment contract. Provincial health plans are not considered a medical expense.

Some medical practices may not be covered by your medical plan, but are considered a medical expense for tax purposes. For example, I see a naturopath, and while the cost doesn't fall under my extended health coverage, I can claim my receipts as a medical expense. Do a little digging to see if you might be in a similar situation.

Travel medical insurance is considered a medical expense, plus is a good idea in case you do have any medical issues while away. If you fall off a scooter and require stitches or are hospitalized for food poisoning while on vacation, you cannot claim those costs as medical expenses and, without insurance, you will be on the hook for the final bill.

There are new medical expenses added every year. The last federal budget included a new provision for claiming service dogs for individuals who suffer from severe cases of diabetes. These dogs are trained to use their sense of smell to detect any drop in their handler's blood glucose levels. If a drop is detected, the dogs are trained to seek help, activate an emergency call system and fetch medication or insulin kits. These dogs can help prevent their handler's from suffering dangerous consequences of low blood sugar, and now the costs of acquiring and caring for them has been deemed a medical expense that can be claimed come tax time.

If you want to claim as a tax deduction, make sure you keep every receipt that you receive so you don't miss claiming the credit. Medical expenses are regularly reviewed by the CRA and if you have a higher than usual medical expenses in a particular year, there is a good chance the CRA will ask you to provide receipts. If you can't prove that you paid for medical services or goods, you will lose out on the tax savings.


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