My client and his mother lived together for many years. He was approved by CRA to claim her unused Disability amounts. In late 2019, the mother was moved to a personal care home (PCH). As her Power of Attorney (POA), the son continued to remain active with her care and decision making in the PCH, and thus felt strongly that he should still be allowed to claim the DTC transfer from his mother even though they were now living apart, a few km’s from each other.
In 2021, government covid mandates meant that the PCH was closed to family for much of the year, so there was very little visiting. Meanwhile, the son continued to look after her health decisions, financial obligations, etc, as POA.
The question is, should the son be allowed to claim the DTC transfer while his mom was in the PCH?
CRA views “support” in a financial sense, meaning that the mother’s income is insufficient to meet her basic needs (food, shelter, and clothing) and therefore needs your client to assist in providing these needs. The mother’s reliance on your client doesn’t have to be voluntary. It can be in his capacity as the POA. On this basis, a physical presence by your client wouldn’t be required.
You should check to see if the DTC can be claimed along with the fees paid to the PCH. It may be one or the other. The transfer of the mother’s medical expenses would have to be reduced by 3% of her net income.
I have a client that got approved for claiming the DTC for her sister who lives in a nursing home.
You can always document it that you reviewed it with the client that CRA might take a different position, but I would definitely claim it.
This mother had very low income, so no tax are assessed, and thus no medical expenses are claimed, so no conflicts regarding claiming either medical or DTC.
It’s good to know that CRA has approved a DTC for your client, Rein, with sister being in a nursing home. I have a couple of other clients who have been denied the DTC transfer even though the parent lives in the same home. CRA felt that the dependency for support wasn’t high enough for these clients, even though I have other clients in almost the exact same situation where CRA approved the transfer. I’m guessing it really depends on the CRA assessor and how they view the situation, which is why I asked this specific question to get additional feedback.