Tax Tip: Pool the Family's Medical Bills Under the Lower-Income Spouse
The medical expense credit only applies to spending above a threshold — the lesser of 3% of net income or $2,890 for 2026. A lower income means a lower threshold, which means more of the family's bills qualify. On $55,000 of net income the threshold is just $1,650; the lower-earning spouse should almost always be the one who claims.
How to do it
- Add up 12 months of eligible expenses — any 12 consecutive months ending in the tax year, not necessarily January to December. Pick the window with the most spending.
- Combine the whole family's costs for yourself, your spouse, and minor children, and have the lower-income spouse claim the total on line 33099.
- Subtract the threshold. Threshold = the lesser of 3% of the claimant's net income (line 23600) or $2,890 for 2026.
- Multiply the remainder by 14%. That's your federal credit for 2026; your province adds its own credit on top, so the combined relief is often around a fifth of the above-threshold amount.
Watch out
- Only the amount above the threshold counts. $4,000 in expenses with a $1,650 threshold = $2,350 eligible, worth about $329 federally — not 14% of $4,000.
- It's non-refundable. The credit can reduce your tax to zero but not below. The claiming spouse needs enough tax payable to use it.
- Keep every receipt. Dental, prescription glasses, prescription drugs, orthodontics, and many therapies qualify; cosmetic procedures generally don't. When in doubt, check the CRA's eligible list before the appointment, not after.
- Don't double-claim. Expenses reimbursed by insurance or an employer plan can't be claimed. Only your out-of-pocket portion counts.
Frequently asked questions
Can I claim bills I paid last year?
Only if they fall inside your chosen 12-month window ending in the current tax year, and only if you haven't claimed them before. Plan the window around big bills like orthodontics.
Do medical expenses paid outside Canada count?
Yes, if they're the same kind of service that would be eligible in Canada and you have receipts. Travel for treatment has its own stricter rules.
Do health insurance premiums count?
Premiums you pay yourself for private health insurance generally qualify as medical expenses. Employer-paid premiums don't — and the employer's portion isn't your expense to claim.
Sources
- TurboTax Canada – How to deduct medical expenses: https://turbotax.intuit.ca/tips/how-to-deduct-your-medical-expenses-5236
- BesTax – Medical Expense Tax Credit Canada 2026: https://bestax.ca/medical-expense-tax-credit-canada/
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