Why 70% of DTC Applications Are Rejected
The Disability Tax Credit is worth $1,400+/year in tax savings — and it unlocks the RDSP ($3,500/year in government matching). But most applications fail because the medical section of Form T2201 is filled out incorrectly. The doctor checks "yes" or "no" on functional limitation questions, and a single wrong answer means rejection.
What CRA Actually Looks For
CRA doesn't care about your diagnosis. They care about functional limitations. The question isn't "do you have diabetes?" — it's "does your diabetes make it take significantly longer than average to perform basic activities of daily living, even with therapy and medication?"
The categories are:
●Walking — takes 3x longer than average or unable
●Speaking — unable to be understood by familiar people
●Hearing — unable to hear well enough to understand someone in a quiet room
●Dressing/feeding — takes 3x longer or requires assistance
●Elimination (bowel/bladder) — requires assistance or takes 3x longer
●Mental functions — significant difficulty with memory, problem-solving, or adaptive functioning
●Vision — even with corrective lenses, acuity is 20/200 or less
●Life-sustaining therapy — requires therapy at least 3x/week, 14+ hours/week
What to Tell Your Doctor
Before your appointment, prepare a written summary that includes:
1.How long each daily activity takes you versus a typical person — use specific examples
2.What happens without medication/therapy — describe the limitation in its untreated state
3.How often you need help — from family, attendants, or devices
4.How long this has lasted — CRA requires 12+ consecutive months
Doctors often understate limitations because they see you at your best (in their office, with medication). Your summary helps them understand your day-to-day reality.
After Approval: Don't Stop at the Tax Credit
DTC approval unlocks:
●RDSP — Government matches your contributions up to $3,500/year. Plus $1,000/year Canada Disability Savings Bond for low income. Open an RDSP immediately after DTC approval.
●Canada Disability Benefit — New federal program starting in 2025, providing up to $200/month for DTC-eligible adults.
●Retroactive claims — You can request reassessment for up to 10 prior tax years. If your disability existed before your application, you could receive a lump sum of $14,000+.
●Provincial credits — Most provinces offer additional disability credits on top of the federal DTC.
If You're Denied
1.Request the CRA's reasons in writing
2.File a Notice of Objection within 90 days
3.Get a second medical opinion — a different doctor may document limitations more accurately
4.Include a patient letter describing daily challenges in your own words
How FundGap Can Help
Our $29.99 DTC application guide includes exactly what to tell your doctor, how each question on Form T2201 should be answered for your specific condition, common rejection reasons for your type of disability, and what to do after approval (RDSP, retroactive claims, provincial credits).