The Canada Revenue Agency (CRA) often gets a bad rap. And I mean, I get it. They’re after your hard-earned money to pay for taxes! Even if they’re taxes to pay for the things we need, it doesn’t necessarily help the sting.
However, the CRA isn’t all bad. In fact, beyond credits and benefits, there are also items that the CRA will let you claim — especially when it comes to health care and medical issues. Today, we’re going to look at three common medical requests that Canadians can claim from the CRA. Furthermore, we’ll consider what you can do when you get the cash back.
First off, hearing aids are quite a common piece of medical equipment for many Canadians. The Canadian government has therefore made hearing aids or any personal assistive-listening devices including repairs and batteries.
Not only are hearing aids tax deductible. These items can also be claimed in full. All the expenses can be claimed by you as long as they were not reimbursed. That means making sure that if it was covered by insurance, this amount isn’t included in what you claim from the CRA.
Now, it’s important to note here that we’re not talking about being on a fad diet. There are people out there with a severe gluten intolerance. This is likely given a diagnosis of celiac disease by a doctor. That’s the important part if you’re going to claim this amount from the CRA.
But claim, you can! For every item you purchase, you’ll be making incremental savings throughout the year — not, however, on the full amount. Instead, whatever the gluten-free item costs, you’ll have to subtract what a similar product would have cost from the amount you paid.
So, for example, if you buy a $5 box of gluten-free pasta, and regular pasta is $2, you can claim $3 from the CRA. This certainly adds up throughout the year. Also, be sure that this is only being served to you. If others in your household eat gluten-free as well, you can only claim what you eat.
Yes, indeed, you can claim medical marijuana as well from the CRA! And this is an important one. While medical marijuana is legal, it’s usually not covered by healthcare insurance plans. Because of this, it’s important to see if you can claim your medical marijuana expenses.
Of course, you’ll need a prescription for this as well. But once you have one, you can claim any type of cannabis as an expense, whether it’s oil, edibles, or whatever! As of writing, you’ll be able to claim your total eligible medical expenses, less $2,421 (or 3% of your net income, whichever is less).
Here’s the thing. For medical costs, you usually are going to make an upfront payment that needs to be paid for in full. Then, you’ll still have to wait around to get reimbursed. Or even worse, you’ll have to wait for a tax refund.
Because of this, it might be better to act like you’re not getting reimbursed. Then, when the cash comes your way, invest it! This not only will give you some cash to invest with, but it will also help create a health savings account to put towards future medical expenses — ones that perhaps aren’t covered by CRA.
A great option then is to invest in a solid blue-chip company like one of the Big Six banks. Bank of Montreal (TSX:BMO) would be a strong option as one that has a lot of growth ahead. That’s thanks to its investment in the Bank of the West in the United States. Plus, it trades at 10.82 times earnings, with a 5.37% dividend yield as of writing!
So, don’t just give up cash for items you genuinely need. Look at what you can apply for and consider claiming it from the CRA. Then use that cash for your own benefit in the future.
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* Returns as of 10/10/23
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