(From the July 2026 edition of eFORUM)
By Jamie Golombek and Debbie Pearl-Weinberg
The Registered Disability Savings Plan (RDSP) is an important tax-deferred savings tool for clients with disabilities and their families. It allows a plan holder to contribute up to $200,000 for a beneficiary who is 59 years of age or under and who qualifies for the disability tax credit (DTC) at the time the plan is opened and when contributions are made. The generous government Canada disability savings grant and Canada disability savings bond available for RDSPs are often the motivation for clients to set one up.
Changes announced in the April 2026 Spring Economic Update may make it easier for some Canadians to qualify for the DTC and, in turn, make them eligible to open an RDSP.
DTC eligibility requirements
To qualify for the DTC, an individual must have a severe and prolonged impairment in physical or mental functions necessary for everyday life. Even with appropriate devices, medication and therapy, the impairment must markedly restrict the person’s ability to perform a basic activity of daily living, such as walking, feeding or dressing, mental functions, speaking/hearing/seeing or eliminating bodily waste. Alternatively, the individual may qualify if they would be markedly restricted were it not for extensive therapy required to sustain a vital function.
A valid DTC certificate not only allows a person to claim the DTC itself and qualify as a beneficiary for an RDSP, but is also a requirement for accessing other federal disability benefits, including the relatively new Canada Disability Benefit, the Child Disability Benefit and the disability supplement to the Canada Workers Benefit.
Under the current rules, a qualified medical practitioner must provide detailed information on the DTC application regarding the specifics of the disability and the impact of the impairment on the applicant’s daily life. This can be time-consuming for the medical practitioner.
Streamlining some medical conditions
Over the past few decades, the CRA’s experience in processing DTC applications has allowed for the identification of several long-lasting medical conditions that satisfy the disability criteria of the DTC. April’s Economic Update provided a list of more than 40 long-lasting medical conditions that will now be eligible for a streamlined application. Under this new proposal, for individuals who have at least one of the listed medical conditions, a qualified medical practitioner would simply need to certify that the individual has the medical condition. The practitioner would no longer be required to provide more detailed information.
Among the conditions contained on the list are autism spectrum disorder (level 3), cerebral palsy (severe), cystic fibrosis, dementia, profound hearing loss in one ear and severe hearing loss in the other ear, schizophrenia, traumatic brain injury (severe) and certain limb amputations.
This new policy, however, does not change the criteria under the Income Tax Act to qualify for the DTC. The CRA has the authority to ask for additional information to verify that these criteria are met, including from the medical practitioner.
Certification requirements updated
As is currently the case for all individuals who qualify for the DTC, individuals with a long-lasting medical condition still need to inform the CRA in writing if there is an improvement in their medical condition that could impact their eligibility for the DTC. Medical practitioners will continue to certify DTC eligibility as before for individuals who have medical conditions not mentioned on the list but still meet qualification requirements.
The Economic Update also proposed expanding the types of impairments that may be certified by certain qualified medical practitioners for the purposes of the DTC, starting in 2027. Specifically, the proposals would expand the range of medical professionals who can certify these impairments. Occupational therapists would be permitted to certify impairments affecting bowel or bladder functions, speech-language pathologist could certify impairments affecting feeding or hearing, and physiotherapists could certify impairments affecting feeding or dressing as well as the cumulative effects of multiple restrictions involving walking, feeding or dressing.
The government also proposed adding podiatrists to the list of qualified medical practitioners who may certify impairments for the DTC. Podiatrists would be permitted to certify impairments affecting walking that are within their scope of practice.
Jamie Golombek, FCPA, FCA, CPA (IL), CFP, CLU, TEP, is managing director, tax and estate planning with CIBC Private Wealth in Toronto. He can be reached at jamie.golombek@cibc.com.
Debbie Pearl-Weinberg, LL.B., is executive director, tax and estate planning with CIBC Private Wealth in Toronto. She can be reached at debbie.pearl-weinberg@cibc.com.