Disability tax credits are important for some Canadians. But applying for these can cost thousands.

When Kathy Meyers heard she could get money back from the Canada Revenue Agency (CRA) through the Disability Tax Credit, she was excited — but the prospect of filling out the form with her doctor felt like another burden on her already difficult days.

Meyers, a resident of Port Coquitlam, B.C., has Crohn’s disease. Her condition is critical – even with an ileostomy and removal of her colon, she remains in the hospital for months at a time, and is on permanent disability because she is unable to work.

So when a friend recommended True North Disability Services to handle the Disability Tax Credit (DTC) applications for Meyers and her 14-year-old son, it seemed like the perfect fit.

Her husband, who is also disabled, plans to file the application himself after his doctor refused to let him work with the DTC advocacy company.

More than a year after she first hired True North, Meyers is still waiting for the results of her application. But for their son’s successful return, the family was billed more than $7,600 by the company – 20 percent of the money they receive from CRA, plus GST.

According to CRA’s 2018 dataThese businesses charge people 15 to 40 percent as incidental fees for their services.

Meyers says that money could have come in very handy for her low-income family, because the money she received from the CRA has so far gone back to paying off bills and debts. This comes in addition to two $150 fees that still remain to be paid to her doctor, who was responsible for filling out all but two of the 16-page DTC forms for both Meyers and her son.

Meyers says he regrets using the DTC company — especially now knowing Free options available,

“It’s been very stressful and financially it’s been very difficult,” Meyers said.

“I think they’re abusing the people who need to get this disability tax credit because they’re taking such a large portion of the exemption.”

CRA estimates Applications for DTC will triple over the next five to six years because the main requirement is to receive the new monthly $200 Canada disability benefit, which will Start Payment in July,

But awareness of free or low-cost help is limited – many are turning to True North and other DTC advocacy companies that offer to streamline the application process for a percentage of the returns.

DTC companies say their fees – which are charged only in the case of successful applications – are important to fund support for DTC application filing, and also to promote customer advocacy for CRAs and medical professionals.

Along with nonprofits and other groups that provide free assistance, there are other services that charge a flat rate, usually a few hundred dollars.

Former MP Carla Qualtrough, who pushed for the creation of the Canada Disability Benefit during her time as Minister of Employment, Workforce Development and Disability Inclusion, is critical of the DTC application system – and of companies that profit from funds targeted for people with disabilities.

She says it’s heartbreaking to hear about what Meyers’ family is going through.

“It feels like people are being taken advantage of,” he said.

“It’s really frustrating to me, because the whole purpose of these benefits is to reduce poverty, to help people pay for things they desperately need, and then they’re being charged thousands and thousands of dollars.”

The federal government has Attempts were made to limit fees Up to $100 – but an injunction from the BC Supreme Court blocked it in 2021, following a legal challenge by True North and its co-founder Shane Nersesian. A trial has been set for July 2026.

DTC companies depend on fees

When contacted by CBC by phone and email, Nersesian declined interview requests. 2021 injunction decision Described Nersessian’s argument against limiting fees.

“Mr. Nersesian contends that the maximum fee limit of $100 set forth in the regulation would cover only basic data entry and processing, leaving little or no room for assistance with issues related to eligibility, advocacy on behalf of the client … and working with a certified health professional and other related services,” the decision states.

“As a result, most, if not all, DTC companies will be driven out of business as providing many DTC services will no longer be economical.”

The decision also provides an overview of the services True North provides to customers, including 10-year tax assessments, having medical professionals explain the application and eligibility criteria and filing objections if customers are “improperly declined.”

In an email to CBC, Nersesian said True North is part of the Disability Tax Fairness Alliance and has played a “key role” in highlighting the issues of denying benefits to insulin-dependent diabetics.

There are former clients who say they are grateful for True North’s help with their applications, such as Kathy Johnson, a resident of Blue River, B.C.

Of the more than $9,000 it got back from DTC, about $1,900 was given to True North. Although Johnson didn’t know about free options before applying, she didn’t feel she had the time and energy to do it herself — and says she would recommend True North to others.

“Really, I have no regrets,” she said.

Others have regrets, like Leanne King, who has diabetes and polycystic kidney disease. She says she probably wouldn’t have spent the $3,850 with True North if she’d known alternatives existed.

“I wasn’t able to manage everything he did at that time,” she said. “I think it’s a lot of money, and I think it’s a little bit predatory, because they’re dealing with people who are sick.”

Medical experts call for streamlining of application

The Canadian Medical Association, BC’s doctors and disability advocates are among those calling for the DTC process to be simplified to reduce the burden on both medical professionals and people with disabilities.

Dr. Charlene Louis, president of Doctors of BC, says the time-consuming forms cause “significant ethical distress for all physicians,” because it takes them away from patients who already have limited access to doctors.

“Ideally, the form would be shortened, made easier to fill out and embedded in the electronic record,” Louis said.

The CRA says it “substantially changed” the application process by digitizing it in 2023 due to concerns in the medical industry. When asked about whether it could streamline further with the suggestions made by Louis — such as accepting doctor’s notes or making forms compatible with existing files — the CRA said it was bound by the law.

“Continues its efforts to make DTC more accessible in line with the recommendations of the CRA (Disability Advisory Committee) to ensure that individuals with disabilities can access credit without financial burden,” the statement said.

Jobs and Families Minister Patty Hajdu was not available for an interview, and her office did not respond to specific questions from CBC. The ministry said Canada is financing $23.5 million Multiple Disability Nonprofits $243 million to help people get benefits, including the DTC, for free, and to eliminate out-of-pocket fees for medical providers to fill out DTC forms.

“The Government of Canada is committed to further reviewing and improving the process for applying for the Disability Tax Credit,” the ministry said in a statement.

According to Qualtrough, the issue stems from the lack of a consistent approach to disability assistance in Canada. Ideally, she says, people should be able to go through a one-step process to access all provincial and federal disability benefit programs.

“We are asking tax analysts to make decisions and act as gatekeepers to these important social benefits, it is simply not appropriate,” he said.