We have written earlier about the Disability Tax Credit (DTC) and the Canada Pension Plan (CPP) disability benefits. A recent Statistics Canada study shows that only a minority of qualified disabled Canadians, who face distinct employment and income issues, are taking advantage of these programs. Personal injury and disability lawyers could be encouraging their clients to ease their financial situation by applying.

The DTC is a non-refundable tax credit that assists persons with disabilities, or family members who support them, by reducing their income tax and offsetting some of the extra costs associated with the impairment. Eligibility for the DTC is determined using the T2201 Disability Tax Credit Certificate (DTCC), completed by persons with a severe and prolonged impairment in physical or mental functions and submitted to the Canada Revenue Agency (CRA) for approval.

The CPP disability benefits are for people younger than 65 who meet a certain contribution threshold and have a mental or physical disability that regularly stops them from doing any type of substantially gainful work. The disability must be either long term, of indefinite duration, or likely to result in early death.

Sadly, a majority (84%) of qualified disabled people are not claiming the DTC or receiving the CPP disability benefits. 13% claimed the DTC and 9% received the CPP/QPP disability benefits. This is puzzling, since over 90% of DTC applicants are accepted.

Perhaps not surprisingly, people with severe or very severe disabilities were more likely to claim these benefits. But a majority of these people still did not take up these supports. Only about one-third applied for a DTC certificate. There are also differences in support uptake by type of disability:

 

Among persons with disabilities who claimed the DTC or received the CPP disability benefits, there were sociodemographic differences:

  • Women were less likely than men to claim the DTC (11% versus 14%)
  • Compared with Canadian-born people (13%), a lower percentage of immigrants and non-permanent residents claimed the DTC (11%)
  • In Manitoba and the Atlantic provinces, larger proportions of persons claimed the DTC (16% to 22%), and the highest percentages of those receiving the CPP disability benefits lived in the Atlantic provinces (13% to 16%)
  • People with secondary and post-secondary education were more likely to claim the DTC and to receive the CPP disability benefits than less educated disabled people
  • Perhaps not surprisingly, those with part-time employment or who were not in the labour force were more likely to claim the DTC or receive CPP disability benefits than those with full-time employment.

In 2022, 8 million Canadians aged 15 and older (or 27%) were identified as having a disability, according to the Canadian Survey on Disability (CSD), and about 41% of them had a severe or very severe disability. Compared with people without disabilities, the disabled are more likely to have lower levels of educational attainment, experience barriers to participate in the labour force, be unemployed, and have lower income, with differences becoming larger as the severity of the disability increases. They may be at an increased risk of living in poverty as a result of the cumulative socioeconomic disadvantages. The 2022 Report of the Office of the Auditor General of Canada emphasized that the government did not have a clear and complete picture of people with disabilities who were not receiving benefits for which they were potentially eligible.

Personal injury and disability lawyers can provide a great service to their plaintiff clients by informing them of available income supports.