Medical expenses can add up quickly, and the good news is the Canada Revenue Agency (CRA) allows you to claim a significant portion of those costs back through the Medical Expense Tax Credit (METC). Whether you paid for dental work, prescription medications, or medical devices, understanding how to maximise this credit can put meaningful money back in your pocket. Here is everything you need to know for the 2025 tax year.
The Medical Expense Tax Credit is a non-refundable federal tax credit that reduces the income tax you owe based on eligible out-of-pocket medical costs. For 2025, you can claim medical expenses that exceed the lesser of $2,759 or 3% of your net income. The federal credit rate is 15%, applied to the amount above that threshold.
For example, if your net income is $60,000, your threshold is 3% of $60,000, which equals $1,800. If you spent $5,000 on eligible medical expenses, you can claim $3,200 ($5,000 minus $1,800), generating a federal credit of $480 (15% of $3,200). Provincial credits on top of that can increase the total benefit further.
The CRA maintains a detailed list of qualifying expenses. Understanding what counts — and what does not — is the first step to maximising your claim.
Prescription drugs require a Drug Identification Number (DIN) and must be prescribed by a licensed medical practitioner. Over-the-counter medications do not qualify even if recommended by a doctor, but prescribed medications dispensed by a pharmacist do.
Dental expenses including routine cleanings, fillings, extractions, crowns, and orthodontic treatment such as braces are all eligible. Vision care including prescription eyeglasses, contact lenses, and laser eye surgery qualifies as well.
A wide range of prescribed devices qualify, including wheelchairs, walkers, crutches, insulin pumps and supplies, CPAP machines for sleep apnea, hearing aids and their batteries, and implanted devices such as pacemakers.
Diagnostic tests ordered by a medical professional, including blood work and imaging, are eligible. Hospital costs such as room and board for a patient (beyond what provincial health insurance covers) also qualify.
Attendant care costs for a person with a severe and prolonged impairment are eligible, subject to specific conditions and dollar limits. Home modifications made to enable a person with a disability to be more mobile or functional — such as wheelchair ramps, widened doorways, or bath lifts — also qualify.
Just as important as knowing what qualifies is knowing what the CRA will not accept. The following are commonly misunderstood non-eligible expenses:
One of the most overlooked planning opportunities within the METC is the flexible 12-month period rule. You are not required to claim expenses strictly from January to December. You may claim any 12-consecutive-month period that ends in the tax year you are filing.
This matters when significant expenses fall across two calendar years. For example, if you had a major dental procedure in November 2024 and follow-up costs in early 2025, you could choose a 12-month window running from November 2024 to October 2025, capturing all those expenses in a single claim on your 2025 return. This strategy is particularly powerful when expenses cluster around the turn of the calendar year.
Families can combine eligible medical expenses for all family members and claim them on a single return. This includes expenses for your spouse or common-law partner, your children under 18, and in some cases dependent parents or adult children.
The key planning insight: because the 3% threshold applies to the claimant's net income, it is almost always more advantageous to claim all family medical expenses on the lower-income spouse's return. A lower net income means a lower dollar threshold, which means more of your total expenses exceed the floor and generate the credit. In households with a significant income gap between spouses, this strategy can substantially increase the total credit claimed.
Working Canadians with disabilities or dependants with disabilities may qualify for the Refundable Medical Expense Supplement — a separate, refundable credit that pays out even if you owe no tax. For 2025, the maximum supplement is $1,391. To qualify, you generally need to have earned at least $3,899 in employment or self-employment income during the year, and your adjusted family net income must be below the phase-out threshold. This supplement is claimed on Schedule 1 alongside the standard METC.
Alberta does not have a stand-alone provincial medical expense credit the way some other provinces do. However, Alberta's provincial tax system applies its own rate to the same eligible medical expenses calculated on your federal return. Alberta's combined provincial credit effectively adds to your total tax relief, making the overall benefit of claiming the METC stronger for Albertans than for residents of provinces with higher income tax rates and lower provincial medical credit rates. For Calgary residents, understanding how federal and Alberta provincial credits interact can optimise your total refund.
The Medical Expense Tax Credit is claimed on Schedule 1 (Federal Tax) of your T1 General return, on lines 33099 (your expenses and your spouse's/partner's) and 33199 (for other dependants). You calculate the eligible amount, subtract the lesser of $2,759 or 3% of net income, and apply the 15% federal rate to determine your credit.
You do not submit your receipts with your return, but the CRA requires you to retain all receipts for six years from the end of the tax year in which they were claimed. Keep pharmacy printouts, dental invoices, hospital billing statements, travel logs, and any other supporting documentation well organised and easily accessible in the event of a CRA review.
The team at Swift Accounting Calgary regularly helps clients identify overlooked eligible expenses, choose the optimal 12-month claim period, and structure family claims for maximum benefit — details that tax software alone often misses.
Medical tax planning is one area where a few informed decisions can produce a noticeably larger refund. If you want to ensure you are capturing every eligible dollar, Swift Accounting in Calgary offers personalised tax preparation and planning that goes well beyond data entry.
Contact Swift Accounting today to speak with a Calgary tax professional about your medical expenses and how to structure your 2025 return for the best possible outcome.
Yes, in many cases you can. The CRA allows you to claim eligible medical expenses for dependent relatives, including parents, on line 33199 of your return. A dependent relative is generally someone who depended on you for support due to physical or mental infirmity. The threshold calculation for dependants uses the higher of two figures rather than the standard lesser-of calculation, so it is worth reviewing which scenario produces the larger credit before filing.
Not for every expense, but documentation requirements vary by category. Prescription drugs require a valid prescription; attendant care and certain devices require a certification from a medical practitioner. For many common expenses such as dental invoices or lab test receipts, the invoice itself is sufficient. The important rule is to retain all receipts for six years regardless, as the CRA may request them during a review.
You can only claim the portion of eligible expenses that you paid yourself and were not reimbursed for. If your employer's group benefit plan reimbursed $800 of a $1,500 dental bill, only the $700 out-of-pocket amount is eligible for the METC. Amounts reimbursed through a non-taxable employer plan must be excluded from your claim entirely.
There is no upper dollar limit on the total amount of eligible medical expenses you can claim for yourself, your spouse, and your children under 18. However, for other dependants (parents, adult children, siblings, etc.) claimed on line 33199, the maximum allowable medical expense claim per dependant is $10,000 for the 2025 tax year. The Refundable Medical Expense Supplement also has its own separate maximum of $1,391 and is subject to income phase-out rules.
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