# CRA line 306 or 315



## jazzman (Dec 15, 2014)

Hi, 

My parents and my sister have recently moved in with me. My parents have no income and my sister is mentally disabled. I provide necessaries of life for my parents and my sister. They depend on my financially. They have started living with me since Sept 2016

I have a couple of questions regarding this:

1) For my sister, which tax credit can (should) I claim? Line 315 (caregiver amount) or line 306 (amount for infirm dependents)

My concern with 306 is that it states in the "notes" section that "A child can include someone older than you who has become completely dependent on you for support and over whom you have custody and control."

While I do provide financial support for my sister, I do not have legal custody of her. So i am thinking that means I cannot use 306, 315 is the best way to go?

2) My second question is, how does my sister "become" my dependent? do I have to do something for this or does the fact that she lives in my home and I provide food, shelter and financial support makes her my dependent?

3) Finally, can my sister's disability tax credit (DTC) be claimed by me since she lives in my home and i provide necessitates of life?

Thank you


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## twa2w (Mar 5, 2016)

How old is your sister? And what province are you in? Also how old are your parents.
Does anyone have guardianship or committeeship over your sister now?
Procedures for legal custody vary by province and sometimes nature of relationship.
Most provinces also have a plan that pays money to disabled adult to assist with living cost. Have you looked into this? In Ontario it is the ontario disability support program.


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## jazzman (Dec 15, 2014)

My sister is 40.
I am in BC
My dad is 70 and my mom is 60




twa2w said:


> How old is your sister? And what province are you in? Also how old are your parents.
> Does anyone have guardianship or committeeship over your sister now?
> Procedures for legal custody vary by province and sometimes nature of relationship.
> Most provinces also have a plan that pays money to disabled adult to assist with living cost. Have you looked into this? In Ontario it is the ontario disability support program.


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## twa2w (Mar 5, 2016)

Thanks. Here is a link to some prov of BC info
http://www2.gov.bc.ca/gov/content/f...eople-with-disabilities/disability-assistance
I assume your family are recent immigrants and have not worked in Canada because you say your parents have no income. If your dad was in Canada for 10 years prior to age 65 then he would qualify for some OAS. Old age security.
Your mother would qualify for same at 65.
If they worked in Canada they would qualify for CPP as well.
So perhaps some financial help there.
Not sure how severe your sister's handicapp but in BC to look after her financial affairs, you apply through the courts to be 'committee of estate' If she is totally incapable or for a representation agreement for routine 
management of financial affairs(Financial RA7) if she has some understanding. Here is some more info https://www.google.ca/url?sa=t&sour...gg1MAI&usg=AFQjCNEOFX4jf7yJYy_nc-Lh6NhQLRmU7g
You will likely have to see a lawyer for these and other options.
I suggest you call the lawyer referral service. A short appointment can likely answer most of your questions for little cost and give you a good idea of the process involved and the potential costs. As well as the problems that could occur if you don't. 
http://www.cbabc.org/for-the-public/lawyer-referral-service
Sorry, I haven't answered your original question on line to use on taxes. I will take a look shortly - not sure if there is one answer. At first glance I would say it depends.

Hope this helps
Cheers
J


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## Market Lost (Jul 27, 2016)

I haven't worked as an accountant since the caregiver amount came out, but you can certainly claim a parent as a dependent if they have not income.


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## carverman (Nov 8, 2010)

I have a DTC and to qualify for the DTC the person applying for the DTC has to be determined that he/she is disabled on at least 2 important functions of everyday living,
requiring assistance of some form from others. I have a personal support worker that comes in. 

You may not be able to just state the person is disabled, living with you and dependent totally on your support, with no income from any other source(s) on your tax return. 
CRA will catch this and send it off to their auditors asking for more information. 

If a current DTC (good for 10 years with CRA is in effect) or a Permanent disability DTC is in effect, ( this has to be certified as permanent disabilty by your sister's doctor), you can include a copy of the letter from CRA indicating that they have granted a DTC to your sister.

In the case of claiming the caregiver amount, here is what CRA has to say:



> *The CRA may ask for a signed statement from a medical practitioner showing the nature of the impairment, when the impairment began, what the duration of the impairment is expected to be, and that because of an impairment in physical or mental functions, the person is, and will continue be, dependent on others.*



You can pretty much count on having your return audited initially by CRA, asking for proof of disability and other factual information.

Here is more information from CRA on line 306. 
http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/ddctns/lns300-350/306/menu-eng.html#rprt



> To calculate your claim and give *certain details about each of your dependants, complete the appropriate part of Schedule 5, Amounts for Spouse or Common-Law Partner and Dependants, and attach it to your paper return. *Enter, on line 306 of Schedule 1, Federal Tax, the total amount claimed for all dependants.


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## carverman (Nov 8, 2010)

jazzman said:


> Hi,
> 
> 
> 2) My second question is, how does my sister "become" my dependent? do I have to do something for this or does the fact that she lives in my home and I provide food, shelter and financial support makes her my dependent?
> ...


Here is what CRA has to say about her transferring HER DTC to you to claim on your return.



> *Line 318 – Disability amount transferred from a dependant*
> You may have a dependant who is able to claim the disability amount (line 316), and that person may not need to claim all or part of that amount on his or her income tax and benefit return. Under certain conditions, your dependant may be able to transfer this amount to you. If your dependant is eligible for the disability tax credit (DTC), you may be able to claim all or part of his or her disability amount on your tax return.
> 
> If you are not attaching a Form T2201, Disability Tax Credit Certificate for a dependant, attach to your paper return a note stating the dependant's name, social insurance number, and relationship to you.


If you are going to do this,attach separate pieces of paper with the information on your sister and if her DTC is still valid and in effect.

Remember, that unless the DTC is given a permanent status, it expires on December 31st of the 10th year when it was granted by CRA.

ie: if the DTC was granted in 2006 for her, and an *application has not been submitted by her and her family doctor to reinstate her disability
requiring further 10 year extension,* the DTC amount you claim for her could be disallowed. 

You will need to know which year the DTC was given to her, and which year it will expire, 
IF the DTC is not certified by a family practitioner as a PERMANENT disability.

http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/rtrn/cmpltng/ddctns/lns300-350/318-eng.html


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## jazzman (Dec 15, 2014)

One other question I have is whether my tax return and my sister's tax return need to go together (in paper form, because it will be my sisters first return and apparently it has to be paper)

If they do not have to go together, is it better if her tax return goes in first and and then I can submit mine after 6 weeks claiming caregiver amount.

Or does it not matter at all.

I am well aware that I need to have Disability assessment forms completed by a doctor and I need to send it to CRA.

As far as 2 functions are concerned. 

1) My sister cannot cook food at all. She cannot feed herself. We cook food for her but she can eat with her own hands.
2) My mother helps her in the washroom. She cannot use the washroom on her own (i.e using the toilet, shower)

Thanks




carverman said:


> Here is what CRA has to say about her transferring HER DTC to you to claim on your return.
> 
> 
> 
> ...


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## carverman (Nov 8, 2010)

jazzman said:


> One other question I have is whether my tax return and my sister's tax return need to go together (in paper form, because it will be my sisters first return and apparently it has to be paper)
> 
> If they do not have to go together, is it better if her tax return goes in first and and then I can submit mine after 6 weeks claiming caregiver amount.
> 
> Or does it not matter at all.


Your sister (if she has a SIN) has to complete (or have someone, like yourself, complete a paper T1 General return form for her. 
She would have to declare any income given to her for her support by gov't agencies, and any additional amounts for any caregivers (such as yourself) to be able to look after her with her disabilities. This kind of support is non taxable but still has to be declared on her return. 

If you are going to be using her full disability allowance (DTC) , you will (probably) have to provide a separate sheet (note)indicating why you are transferring all or part of her disability allowance line on 316 on her tax return (even if she had Zero income) for the taxation year, to YOUR INCOME TAX RETURN line 318 on Schedule 1.

For example: For the 2015 tax return, I was able to claim $7899 (Fed) along with other personal deductions..but this amount can only be claimed IF SHE HAS A VALID DTC already from CRA. Until she gets a letter from CRA that her application has been approved, she can't claim the "Disability amount for self", as far as I know. 

Don't forget to include the PROVINCIAL disability allowance as well, which is also available to her and you for transfer on the separate provincial forms.
For example: On the Ont 2015 tax return I could claim $7968 along with other deductions to reduce my provincial tax payable.
That is why both paper returns have to be sent in together.

If there is other extenuating circumstances of why she is living with you as a fully dependent, and you have now become her sole caregiver, that may also be necessary to explain to CRA in a signed letter.

CRA will track her by her SIN and your SIN on both returns. They will send her and you separate assessments (at least I believe) and any allowances for her personal care/lodging will be allowed in the assessment(s). 

I would expect that on first filing of both hers and yours, expect a followup letter from CRA asking for more detailed information on her income status, (disability pensions, other provincial assistance........ such as ODSP in Ontario and so on.
Usually the first time, you claim a dependent's DTC allowance, CRA may ask for more information. 



> I am well aware that I need to have Disability assessment forms completed by a doctor and I need to send it to CRA.


 Ok, She/you may have to wait 2-3 months for the letter from CRA approving her application. As I explained earlier, the normal
DTC certificate is only for 10 calendar years. IF a physician assesses her condition as PERMANENT, then it needs to be indicated on the
initial DTC application form, 

other wise it may be included on the renewal application for the DTC in the year of expiry, (10 years from the date
of the start year of the disability). 



> As far as 2 functions are concerned.
> 1) My sister cannot cook food at all. *She cannot feed herself.* We cook food for her but she can eat with her own hands.
> 2) My mother helps her in the washroom. She cannot use the washroom on her own (i.e using the toilet, shower)


 see CRA Form T2201 (DTC application)
Part B – Must be completed by the medical practitioner
To be approved for a DTC,there is several criteria required.

http://www.cra-arc.gc.ca/E/pbg/tf/t2201/README.html

She needs to be marked as qualified (yes/no) in at LEAST TWO of the following criteria to qualify, according to my physcian. 



> It is mandatory that you describe the effects of your patient's impairment on his or her ability to perform each of the basic activities of daily
> living that you indicated are or were markedly or significantly restricted. If you need more space, attach a separate sheet of paper. You may
> include copies of medical reports, diagnostic tests, and any other medical information, if needed.
> Effects of impairment


:

Critieria of impairment(s):
1) Dressing requiring assistance, 2)feeding requiring assistance, 3) Elimination requiring assistance, 4) vision 5) hearing 6) walking/mobility 7) mental functions required for everyday living, 8) life sustaining therapy

Physcian has to certify the cumulative effects of one or more of the criteria for the DTC and the overall effects of the impairment(s) in her daily living.


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## jazzman (Dec 15, 2014)

Hi carverman, 

Thank you for your response. You mentioned a few things that I want to make sure I understand. 

You said "She would have to declare any income given to her for her support by gov't agencies, and any additional amounts for any caregivers (such as yourself) to be able to look after her with her disabilities. This kind of support is non taxable but still has to be declared on her return."

So before she immigrated to Canada, I used to send money to my parents (both retired with no income) bank account every year via wire transfer for food and other necessities of life. Since my sister was living with my parents, this money was used to provide her with necessities of life. While she is living with me, she completely depends on me financially. Is she really required to declare this money I spend on her as income? if yes, how/where can we tell CRA that this money was a gift? Also, it would be a problem to know exactly how much I am spending on her.

I guess what I am saying is that I have not been keeping track of how much electricity she uses, how much food she eats, clothing so I do not know exactly how much I have given her. She just lives with me just like another family member.

I have always filed my tax return online using NETFILE, but you are recommending that because my sister has to file a paper return and because I am claiming her disability allowance and caregiver amounts, I should also file a paper tax return and send both of them together? It does make sense, except paper returns could take months.

Thank you




carverman said:


> Your sister (if she has a SIN) has to complete (or have someone, like yourself, complete a paper T1 General return form for her.
> She would have to declare any income given to her for her support by gov't agencies, and any additional amounts for any caregivers (such as yourself) to be able to look after her with her disabilities. This kind of support is non taxable but still has to be declared on her return.
> 
> If you are going to be using her full disability allowance (DTC) , you will (probably) have to provide a separate sheet (note)indicating why you are transferring all or part of her disability allowance line on 316 on her tax return (even if she had Zero income) for the taxation year, to YOUR INCOME TAX RETURN line 318 on Schedule 1.
> ...


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