Most medical receipts (e.g. prescriptions, dental, chiropractic, travel insurance) are retained for 12 months and then discarded as useless for personal tax purposes, because no tax benefit is available for many individuals until total medical expenses exceed $2,208 (2015).
And beyond the minimum threshold, the available tax credit is very small.
However, for individuals who receive T4 income from a corporation they control or who receive significant income from self-employment, medical receipts can be used in another way to reduce taxes payable. For an explanation of the Aquilian Benefits PSHP, see here.
Tax preparers may wish to use the following practice to minimize their clients’ taxes payable:
A. Prepare the individual/couple T1 in draft.
B. Total all medical receipts.
C. Calculate whether tax savings are available using the Tax Savings Calculator. Tax savings result from converting the after-tax personal medical expenses into deductible business expenses.
D. If tax savings are available, obtain consent from the taxpayer to disclose their contact details and medical expenses to Aquilian Benefits.
E. Open the Tax preparer Claim Form and enter taxpayer contact details and a summary of the medical expenses claimed. Save the Claim Form.
F. Only if the taxpayer is self-employed, from the Claim Form copy the Total Payment Amount into the T1 on Line 9270 of T2125/T2121 or Line 9790 of T2042.
G. Scan all medical receipts.
H. Email the Claim Form and receipts to email@example.com.
I. File the T1 as usual.
J. Aquilian Benefits will contact the taxpayer to complete the transaction. There are no fees beyond those already disclosed on the Claim Form. Reimbursement to taxpayers of their medical expenses will be made by direct deposit within 7 days.