When you or a loved one is diagnosed with a disability or long-term illness, the financial implications may feel overwhelming or even irrelevant at the time. However, there are a few simple tax and savings options available to you that may significantly impact your family’s well-being.
Here’s a step-by-step plan to get your finances in order so you can spend more time focusing on what truly matters – your family’s health and happiness.
1. Apply for the Disability Tax Credit
The application process is both quick and straight-forward. Being approved for this tax credit is beneficial not only from a taxation stand-point, but also in the retirement planning process.
2. Tax Filing Considerations
If you have enough income to fully utilize the Disability Tax Credits, you are entitled to extra tax savings. Otherwise, you may transfer the remainder to a spouse or another family member.
3. Disability Pension
People who have contributed to the Canadian Pension Plan who are unable to work regularly due to a disability are eligible for a taxable monthly payment, and so are their children.
4. Disability Insurance Options
There are products available through your workplace and personal insurance provider that may pay out in case of disability or illness.
If you need to miss work to support a loved one who is critically ill, injured or in need of end-of-life care, you may be eligible for Canadian Employment Insurance (EI).
5. Retirement Options
With Disability Tax Credit approval, there are also wonderful savings plans available for building long-term financial security for a loved one with a long-term disability.
Click through the heading links on this page for more detailed information regarding each of these steps.