Presentation to Finance Committee Re: Disability Tax Credit Regarding Bill C-462

07 May 2013

A joint presentation of Council of Canadians with Disabilities

and

DisAbled Women’s Network of Canada-Réseau d’action des femmes handicappées du Canada

Presenter: Carmela Hutchison, Member-at-Large CCD Executive Committee and President of DAWN – RAFH Canada

Summary of Recommendations        

    People with disabilities should have their rightful entitlement protected from unfair fees charged by financial promoters.  

Disability Tax Credit has become the gate for determining eligibility for a variety of benefits.  Thus, we must ensure unencumbered and fair access.

As the Disability Tax Credit becomes more commonly used as the determinant of eligibility for other federal benefits, there is a need to once again review the forms and process of establishing eligibility.

Remove barriers for people living with mental health disability in the section entitled "Mental functions necessary for everyday life" which has changed markedly from previous years.

Address the issues posed by people with episodic disabilities as the criteria does not help account for the waxing and waning of symptoms within an overall picture of disability.

CCD and DAWN believe disability organizations should be supported, as part of Minister Finley’s interest in Social Financing to assist people, to complete applications for Disability Tax Credit, CPP-D and other relevant government programs.

Disability Tax Credit should be made refundable for those who do not have a taxable income but experience additional costs related to their disability .

Now that Disability Tax Credit eligibility has multiple purposes, eligibility must be considered in relation to these who should be eligible for these other benefits. 

Government of Canada to make a broader review of tax measures for persons with disabilities to create greater access and fairness.

Streamlined process and strategy should allow people to have greater access to programs, clear policies and forms available online to create savings that can be directed to increased benefits and programs for disabled people.

Make the CPP-D, Disability Tax Credit and other Federal Government forms ones you can save as you work through them. 

Review the “other qualified professionals” list of who can sign a Disability Tax Credit application.

Prohibit billing above a set amount for forms for any Federal, Provincial or Municipal government program by either the professionals or for-profit companies.

Protect people from exploitation and outright financial abuse by ensuring some standards for industry "promoters" and financial advisors of people with disabilities.           

Good Morning.  Thank you for consulting with us today.  We wish to acknowledge the Algonquin peoples as we meet on the traditional lands we share.  It is my privilege and responsibility to speak both on behalf of Council of Canadians with Disabilities where I serve as a Member-at-Large of the Executive Committee, and as President of DisAbled Women’s Network of Canada.

CCD and DAWN support the intent of Bill C-462 and agree that people with disabilities should have their rightful entitlement protected from unfair fees charged by financial promoters. 

Disability Tax Credit eligibility is a critical issue for people with disabilities as it has become the gate for determining eligibility for a variety of benefits.  Thus, we must ensure unencumbered and fair access.

In addition, we also recognize that determining eligibility for the Disability Tax Credit can be complex. An inequity exists because it is much easier to provide evidence of a physical or sensory disability than it is to provide evidence of a cognitive, learning, intellectual or mental health disability.  In some instances, the cost of diagnosis is considerable, and in other instances access to professionals able to make this determination is limited.  The Disability Tax Credit, in its current iteration, has created barriers for people living with mental health disability in the section entitled "Mental functions necessary for everyday life" which has changed markedly from previous years.

The reality is that the definition and understanding of disability is always changing.  Medical conditions are also changing and emerging as new discoveries are made.   It is recognized that some disabilities are episodic in nature.  As Disability Tax Credit becomes more commonly used as the determinant of eligibility for other federal benefits there is a need to once again review the forms and process of establishing eligibility.

The Disability Tax Credit was initially designed as a tax fairness measure recognizing that people with disabilities have additional disability-related expenses.  Disability Tax Credit eligibility is now the determinant for accessing other benefits and programs such as: the Registered Disability Saving Plan, the Disability Child Tax Benefit, and the Working Income Tax Benefit for Persons with Disabilities, the Disability Accommodation Benefit in the Tax Act.  For these reasons, an industry has emerged to assist people with disabilities to complete the forms for the Disability Tax Credit and other disability benefits.  It is recognized that this support, while necessary for some, comes at a significant cost. 

A disabled woman from Ontario observed that any percentage fee is unfair, as even 10%, (which initially seems reasonable) is a significant cost if the back benefits are only $10,000 and after a $1000 or 10% fee, this money is the only money left for the many expenses we have as people with disabilities.

Saskatchewan Voice of People with Disabilities, a CCD member organization, helps people complete their forms, as part of their general form completion service which is free.  They also help people write appeal letters if they are denied. Saskatchewan Voice of People with Disabilities have heard of at least 2 companies that offer a fee for service to help people get backdated Disability Tax Credit, they charge 10% if they are successful and nothing if they are not, to their knowledge.  Saskatchewan Voice of People with Disabilities does not believe these Disability Tax Credit promoters do appeals. 

Saskatchewan Voice of People with Disabilities  does not know of anyone who has used either service, the first was advertised in the Regina paper and the 3rd is often advertised when you are on other disability sites as a paid advertisement.  We have listed the links below for your reference:

They are:

http://disabilitycreditconsultants2-px.rtrk.ca/

http://www.bmdservices.ca/?gclid=CPzJ8_zBgrcCFa5DMgod7wIA8A

http://www.thenba.ca/info/?gclid=CMn4jaPCgrcCFVSVMgodLRUAYg

Alberta Committee of Citizens with Disabilities, a member group of CCD in Edmonton, helps with the forms and does RDSP presentations which involve the Disability Tax Credit. They have heard that there is a company in the east that charges a lot of money, perhaps a percentage, to help people get on and for retroactive payments. 

Alberta Network for Mental Health, located in Airdrie, (an organization where I also serve as president), assists people with any government forms they require from any income support program to Disability Tax Credit and beyond -including appeals.  We also accompany applicants to intake appointments and appeals.   We have developed a streamlined and interactive process that accommodates people with disabilities.  We help people remotely, as well, using both  phone and internet as well as screen sharing software when possible.  This is an emerging best practice in assisting people to navigate the system of medical and income supports. We are starting to build linkages and get referrals from various government agencies: CPP-D, AISH, AW, and the local health unit because of the quality of service we can provide.  We also work with offices of specific ministries to help people meet their needs.  Our challenge is that we do this with one staff member (our ED) and volunteers. 

CCD and DAWN believe disability organizations should be supported as part of Minister Finley’s interest in Social Financing to assist people to complete applications for Disability Tax Credit, CPP-D and other relevant government programs.

The Disability Tax Credit should be made refundable so that those who do not have a taxable income but experience additional costs related to their disability would benefit from measures to offset those costs and ease some of their crushing poverty.

The original definition of disability in the Tax Act should be reviewed in that there may be a new group of individuals who would not necessarily qualify for the Disability Tax Credit but possibly should be eligible for benefits such as the RSDP.   Now that Disability Tax Credit eligibility has multiple purposes, eligibility must be considered in relation to these who should be eligible for these other benefits. 

The Income Tax Act as it relates to persons with disabilities now has a number of specific benefits for persons with disabilities but these have been developed in a piecemeal fashion.  We ask the Government of Canada to make a broader review of tax measures for persons with disabilities to create greater access and fairness.  A streamlined process and strategy should allow people to have greater access to programs, clear policies and forms available online and create savings that can be directed to increased benefits and programs for disabled people.

DAWN and CCD have long held the view that we are in many instances using one of the more expensive and in some instances limited resource,  that being the medical profession, as the gatekeeper for benefits.  Some people with disabilities visit their doctor more frequently to get forms signed and completed than for medical reasons.  In some instances the administrative burden posed by qualifying criteria causes active detriments to patient health and can place them at risk of losing their practitioners.

Every person with a disability of a year’s duration who has either CPP-D and/or provincial benefits should automatically be qualified for the Disability Tax Credit.  The requalification period for the Disability Tax Credit should be eliminated.   A person’s condition is unlikely to improve due to the serious and long-term nature of the disability. People understand their need to report changes in their disability and similarly are used to reporting changes in their eligibility.  Such reporting can also be monitored through their tax filing or other regular spot checks done by relevant government departments.  These measures would:

             
Create time for direct patient care  
Reduce medical costs
Decrease administrative costs through decreased reporting; existing monitoring is already in place
Reduce the number of times a person with a disability would need to seek a costly service for receiving the Disability Tax Credit benefit minimizing their risk for financial exploitation           

In the Disability Tax Credit, the applicant only fills in the first page or two and then the remainder is done by the physician who also charges a fee (which will vary from physician to physician).The physician's role and physician's fees should also be addressed in this legislation (even to a minor extent to reflect their role in the costs associated with this process).  In one instance a gentleman completing the form for his child was charged a fee from the physician of $60.00 and in another instance an ophthalmologist charged $278.00 but negotiated the fee to $75 though he did not give the portion of the report that actually described the disability or the prognosis.   To indicate the extent to which this process has become an industry, Alberta Network for Mental Health, an NGO, has been directly billed.  When we explained the nature of our work, the Executive Director was asked why we did not have our own doctors to give us reports!

During my years as a board member of National Network for Mental Health, I was a representative on consultation for the “request for clarification letter”.  During this discussion it was determined the assessors were NOT medical people and that in reality; a functional assessment was being requested.  There is a need to review the “other qualified professionals” list of who can sign a Disability Tax Credit application.

CPP-D reimburses a certain amount to patients for completing the medical report.  Some charge in excess of this standard reimbursement still must be covered by patients, because the health practitioners who do the majority of the paperwork can charge whatever amounts they choose.

Our recommendation would be for the Government of Canada to negotiate a fair fee for completion of the forms, and to prohibit billing above this amount for forms for any Federal, Provincial or Municipal government program by either the professionals or the for-profit companies.

CCD and DAWN are very concerned with the need to protect people from exploitation and outright financial abuse.  None of the informants to this presentation can attest to the efficacy or credibility of their services. They appear unregulated. This means the safety of Canadians with disabilities and their families are at risk.

For proof of why this bill is so important, we need only to look at Vicky Shachtay’s death, a disabled mother of a six year old in Innisfail, Alberta who was murdered by her financial adviser.  Though the crime was not related to Disability Tax Credit promoters referred to in this legislation, it is a clear demonstration that financial abuse did not only take a woman’s money but also her life. Regulation of the fees and protection of citizens with disabilities is so important.  We look forward to working with the Government of Canada as active and engaged partners in improving the lives of Canadians with disabilities.  We thank Ms. Gallant for her initiative and hope you support both her in her work and us in ours. Thank you.