The Canada Revenue Agency allows for cannabis purchased under prescription to be claimed as a “medical expense” deduction.
By Jane Switzer • Mar 19, 2019
Green bud, grey area: Medical cannabis consumers buy products directly from licensed producers, but they must pay for it out of pocket – sometimes to the tune of hundreds of dollars a month.
Medical cannabis generally isn’t covered by third-party health insurance plans because it doesn’t have a drug identification number (DIN), a regulatory stamp of approval issued by Health Canada. Sun Life became the country’s first major insurance company to offer optional coverage for medical cannabis in 2018, while Manulife also launched optional coverage for participating individual and group plans in partnership with Shoppers Drug Mart. A handful of employers may offer some type of coverage through their employee group benefit plans, but for many consumers, the only opportunity for financial relief comes through the taxman.
The Canada Revenue Agency (CRA) allows for cannabis purchased under prescription to be claimed as a “medical expense” deduction on your federal income taxes. Here’s how it works:
Who qualifies to claim medical cannabis?
Anyone with a prescription from an authorized medical practitioner to purchase cannabis from a licensed producer. Producers are legally required to issue receipts, which you’ll need come tax filing time. Hold on to the paper copies, or find out how to access your receipts online. In case of an audit or review, the CRA recommends keeping receipts for six years.
What can you claim?
The amount paid for fresh or dried cannabis, cannabis oils, and cannabis seeds and plants procured from a licensed producer – basically, product only. You cannot claim costs related to growing or accessories such as lights, containers and other storage, fertilizers, vaporizers, pipes, capsules, or capsule filler machines.
How do you file?
Check your receipts and tally up the amount you spent on medical cannabis, and add the total to any other allowable medical expenses you plan to claim on your T1 Income Tax and Benefit Return, the most basic form filed by individual Canadians to complete their income tax return. If your return is prepared by a professional, submit your receipts to them. If you use tax software to complete your return, you’ll be prompted to enter your medical expenses in the deductions and credits section.
Medical expenses don’t have to be calculated by the calendar year, but by any 12-month period ending in the current tax year (2018). If you already claimed these expenses on your last tax return, you can’t claim them again.
What gets deducted?
Your total eligible medical expenses minus the lesser of $2,302, or 3% of your net income (your income after taxes). Depending on how much you make and amount of medical expenses claimed, the threshold can be high. Here are two examples using different incomes and the same $2,500 in medical expenses:
If your net income is $70,000, you must deduct $2,100 from your total medical expenses. You will receive a credit of $400.
If your net income is $30,000, you must deduct $900 from your total medical expenses. You will receive a credit of $1,600.
Each province and territory has different tax laws and policies, but you only have to submit one return through the CRA. Except for Quebec, all provinces and territories let the federal government collect income taxes and administer the returns. Quebec residents file both a provincial income tax return with Revenu Québec and a federal return with the CRA.
The deadline to file your income tax return for the 2018 year is April 30, 2019, or by June 17 if you’re self-employed.
Sourced from: Lift & Co.
On the eighth episode of The Fear of Science, hosts Jeff Porter and Daniel Chai talk about weed and weed culture with Terry Roycroft CEO of MCRCI and comedian Kyle Bottom. Find out what has changed after legalization in Canada and the advances in medicinal marijuana science.
‘The Fear of Weed’
MCRCI is excited to be teaming up with Integrative Alternative Health Service (IAHS) in Red Deer, Alberta! We are happy to be able to offer our industry leading experience to patients in Red Deer and surrounding areas.
MCRCI is joining forces with IAHS; taking over their medicinal cannabis service, adding, support, resources and experience. We will be offering our services to patients (new & old) at IAHS including both our Basic and Production memberships.
IAHS’ mission is to transform how Health & Wellness is perceived through integrative therapies & education focused on Mind, Body & Soul. Bringing these services to your front door. IAHS offers service across Central Alberta so call them today at 587.679.4247 for more information.
Our services through IAHS include:
Evaluation of a patient’s eligibility for medicinal cannabis
Access to Health Canada & ACMPR program
Additional support, as needed, for patients under 18 and patients with no previous
Support from MCRCI educators in understanding the advantages of different licensed
producers and their products
Support from MCRCI educators on cannabis as a medicine, strains, and administration
The arrangement of appropriate follow-up visits with the physician
Adjustments in a cannabis treatment program as needed, to include changes in daily
amounts authorized, re-issuing of medical documents, and additional documentation
Assistance in responding to employer concerns regarding the use of cannabis for
Access to MCRCI educators for ongoing support and guidance
Guidance in the federal ACMPR program
Information regarding dispensaries and/or compassion clubs
Timely reminders to renew ACMPR authorization
Discounts on accessories and products (books, vaporizers, etc.)
“(Dr. Ian) Mitchell, who is participating in a randomized controlled study on the effects of cannabis on patients with post-traumatic stress syndrome, said a lot of what is known about the harms of marijuana also comes from observational data.
He also noted randomized controlled studies examining the benefits of marijuana have been suppressed for decades due to a research blockade in the U.S.”
Read more: Kamloops This Week