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Incremental Medical Tax Information

People diagnosed with celiac disease are able to claim for the added costs of the gluten-free diet on their annual income taxes.

We have a set of resources for you. Fill out the form below and they will be sent to your inbox. The resources include a video recording of a webinar, a spreadsheet sample and handouts.

EARN A TAX CREDIT ON GLUTEN-FREE FOOD

People diagnosed with celiac disease know that the cost difference between gluten-free food and their ‘gluten-filled’ counterparts can be considerable. 

For people diagnosed with celiac disease and have a note written by a doctor, nurse or nurse practitioner on their letterhead saying the date of diagnosis, that they are diagnosed with Celiac Disease and require a gluten-free diet for life, these people can claim this type of Medical Expense. This note only needs to be sent to the CRA if you are audited.

The incremental cost is “The difference in average cost of gluten-free products compared to the cost of a similar product with gluten”. It is calculated by subtracting the average cost of similar gluten-free products from the cost of a similar gluten product. For example, if you have purchased 20 packages of GF cookies in a year – add up how much you spent on all the cookies and divide that by 20 to get the average cost of the GF cookies. Now compare that average cost to a similar size package of gluten cookies (you might need to divide the gluten cookie package price in half due to get to a comparable size). Then you subtract the price of the gluten cookies from the average price for the GF cookies and you end up with your incremental cost. The last step is to multiply that incremental cost by the 20 packages purchased during the year and that gives you the total Incremental Cost claim for cookies. If we write this out it will look like this:

  • 20 pkg GF cookies 240 grams $95.50 total or $4.78 each
  • 1 pkg gluten cookies 575 grams $5.95 or 288 grams for $2.98 (note – took half of price to get package size in line with the GF cookies package size) Keep a log where you got this price/date/store.
  • Calculate Incremental Cost $4.78 – 2.98 = $1.80 x 20 pkgs = $36.00 Incremental Cost

 

When looking at your grocery receipts, try and “group” like things together such as cookies, crackers, pizzas, flour, bread, single items (cookie) so they can be compared to a gluten item (relative in size).

When it comes to comparable gluten items – you are looking for the BIGGEST and CHEAPEST possible – sales count! Through the year keep your eyes out for when gluten products go on sale and clip that evidence from a flyer, take a picture or print the information out from a grocery website. Another good way to “gluten” shop is to go onto a grocery store website such as Save on Foods and fill your cart with the gluten foods you need for comparison, print out your cart and then delete it – who wants to order those things? Then use the printout to substantiate where you get your comparison gluten pricing from. Then those BIG and CHEAP items you need to break down in both size and price to be comparable to your GF item category.

Other useful tips:

  • Only claim items you have receipts for.
  • Do not “estimate” the cost of a gluten item – you need documentation for your comparable prices when being audited.
  • Do claim the cost of GF bread/buns/crusts if they are itemized separately on a restaurant bill.
  • Only claim food for the person in the household diagnosed with CD.
  • Update your “spreadsheet” monthly or quarterly – keeping current means less work at tax time!

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