A Canadian resident (Michael) cared for his father (Dennis) who fell ill while visiting Canada on a short-term visa. Michael paid for his father's medical expenses but couldn't claim them as a deduction on his tax return because his father wasn't a resident of Canada for tax purposes. This was the issue in a recent case heard by the Tax Court of Canada, Persaud v. The King, 2024 TCC 42.
One can be a resident of Canada under two circumstances. One is either a deemed resident or a factual resident. Dennis was not a deemed resident as he did not spend 183 days or more in Canada. He was also not a factual resident of Canada at any time during his visit.
Key Point: To claim medical expenses for a dependent on your Canadian tax return, they must be a resident of Canada at some point in the year, even if they are not a spouse, child, or grandchild.
If you are planning to bring a parent or other relative to Canada for an extended visit, ensure you understand the tax implications of any potential medical expenses they may incur. You may want to consider getting temporary health insurance for them.
The content of this article is intended to provide a general guide for educational purposes only. It does not create a lawyer-client relationship. For your specific circumstances, please contact a specialist.