Home Accessibility Tax Credit (HATC) for the Disabled and Infirmed

Key Takeaways

Home Accessibility Tax Credit is available to individuals with Disability Tax Credit (DTC), and/or certified as infirmed by a licensed physician, or 65 years of age or older.

Home improvements must be performed by a licensed professional. If the work is performed by an individual other than a licensed professional, the individual must be a GST/HST registrant.

Qualifying renovation must be for the sole purpose of improving accessibility or reduce risk for the individual, must become an integral part of the dwelling, and it must be immovable.

Home Accessibility Tax Credit (HATC) is a federal non-refundable tax credit intended for eligible individual’s home accessibility renovation and alteration expenses. An eligible individual is either a person who is a qualifying individual (i.e., the person with the disability of infirmity) or making a claim on behalf of a qualifying individual such as a parent, spouse, siblings or any other caregiver. There are also provincial home accessibility tax credits such as Ontario Seniors' Home Safety Tax Credit which are not the focus of this blog. We will discuss the provincial home accessibility credits in future blogs.

A qualifying individual must fall into one of the following categories:

An individual who is eligible and approved for the Disability Tax Credit (DTC) during the tax year.

An individual who has been assessed by a licensed physician and certified as being infirmed.

An individual 65 years of age and older.

An eligible individual most commonly is one of the following:

A spouse or common-law partner;

A child or a grandchild;

A brother, sister, nephew or niece;

A parent or a grandparent;

An aunt or an uncle.

For the 2023 tax year and subsequent years, a qualifying individual can claim up to $20,000 in eligible expenses. HATC is calculated by multiplying the lowest income tax rate (15%) by the amount of the eligible expenses (max. $20,000) which would provide a tax credit up to $3,000. A qualifying individual can have only one eligible dwelling in the tax year but in some instances, such as moving to a new dwelling, a qualifying individual can have more than one dwelling. In such instances the total eligible expenses for both dwellings can not exceed $20,000.

An eligible dwelling which is a housing unit located in Canada, must fall into one of the following categories:

Owned solely or jointly by the qualifying individual and inhabited in the tax year.

Owned solely or jointly by the eligible individual and inhabited in the tax year with the qualifying individual.

A qualifying renovation is a renovation or alteration that is:

purchased and performed in the tax year,

is intended for long-term use,

becomes an integral part of the dwelling and is immovable,

improves access and mobility for the qualifying individual, and

reduces the risks for the individual such as handrails and shower fixtures to reduce the risk of falling.

It is recommended that a qualifying renovation or alteration to be performed by a licensed and registered professional such as a plumber, electrician, carpenter or a contractor. If the work is performed by the qualifying or eligible individual, the value of their labour can not be claimed and only the following expenses can be claimed as a qualifying expense:

building plans

building permits

materials

fixtures

equipment rentals

If the renovation or alteration work is performed by a family member related to the qualifying or eligible individual, the family member is required to be registered for goods and services tax/harmonized sales tax (GST/HST) under the Excise Tax Act.

The following expenses are not eligible for the HATC:

routine repair and maintenance work

amounts paid to acquire a property where the renovation will take place such as purchase of additional land to build a ramp

household appliances and home entertainment devices

housekeeping

security monitoring

There are certain eligible expenses which also qualify as a medical expense tax credit (METC). In that case, the expense can be claimed as HATC and METC on line 33099 or 33199.

To claim the HATC you must:

complete the chart for line 31285 of the federal worksheet;

enter the result on line 31285 of your return; and

File your return.

Eligible expenses are required to be supported by acceptable documentation, such as agreements, official invoices, and receipts. They must clearly identify the type and quantity of goods bought or services provided including:

The name, address, phone number/email and GST/HST number of the vendor/contractor (if applicable),

Complete description of the goods purchased,

Date when the work was completed or purchase was made,

Proof of payment (receipts, credit card slips, cancelled checks

For further information please contact Taxtron Support at 416-491-0333 or visit www.taxtron.ca