Medical Expense Tax Credit (2026): Claim It on the Wrong Return and You Lose
Expenses count only above the lesser of 3% of net income and $2,890. Because that floor follows income, the same $6,000 of receipts is worth $293 more on a $45,000 return than a $120,000 one. Which spouse claims is the decision, and it is made after the fact.
Canada has no personal account for medical costs, no HSA and no flexible spending account. What it has instead is a credit with a floor under it, and two choices the taxpayer makes at filing time: whose return the expenses go on, and which twelve months they cover. Both are worth money and neither is automatic.
How the 3% rule works
You cannot claim your medical expenses. You can claim the part of them above a floor, and the floor is the lesser of 3% of your net income and $2,890 for 2026.
| Net income | Floor | Claimable on $6,000 | Credit, Ontario |
|---|---|---|---|
| $30,000 | $900 | $5,100 | $972 |
| $45,000 | $1,350 | $4,650 | $886 |
| $60,000 | $1,800 | $4,200 | $800 |
| $90,000 | $2,700 | $3,300 | $629 |
| $120,000 | $2,890capped | $3,110 | $592 |
Federal credit at the lowest rate of 14% plus Ontario's at 5.05%. Every province has its own rate and its own threshold, so the provincial half differs; the federal half is the same everywhere.
The cap is what makes the credit behave oddly. Up to about $96,333 of net income, the floor rises with what you earn. Above that it stops at $2,890 and everyone faces the same floor, so a person on $120,000 and a person on $400,000 subtract exactly the same amount.
Which spouse claims is worth $293
Either spouse may claim the family's expenses, and the floor applied is the claimant's. Lower income means a lower floor, which means more of the same receipts survive it.
Federal credit at 14% plus Ontario at 5.05%, 2026. The expenses, the household and the receipts are identical; only the return they are claimed on differs.
The same receipts are worth $293 more on the lower-income return. This is the opposite of most couple-level tax planning in Canada, where income is moved to the lower earner; here the deduction is. Claim the whole family's expenses on one return rather than splitting them, because splitting applies two floors instead of one.
One exception matters: the credit is non-refundable, so it is worth nothing beyond the tax the claimant actually owes. A spouse with very little income may not be able to use it, in which case the higher earner claims it despite the larger floor. Check the lower earner's tax payable first with the income tax calculator.
The 12 months are yours to choose
The claim period is any 12-month period ending in the tax year, not the calendar year. That is unusual in the Income Tax Act and it is the second decision worth making deliberately.
Expenses that straddle a year end, dental work in November and the follow-up in February, would otherwise be split across two returns and meet the floor twice. Choosing a window that ends in, say, June pulls both into one claim and subtracts the floor once. The only rules are that the period ends in the tax year and that no expense is claimed in two different years.
What actually counts
Wider than most people assume. Prescription medication, dental treatment, eyeglasses and contact lenses, many practitioners' fees, attendant and nursing home care, and travel where the treatment was not available within a reasonable distance.
The most frequently missed item is the premium you pay to a private health services plan, including the share deducted from your pay for employer coverage. For a family with no large bills, that premium is often the single biggest eligible amount on the list and the only thing that gets them over the floor at all.
What does not count: over-the-counter medication, even when a doctor recommends it, because it must be prescribed and recorded by a pharmacist; most purely cosmetic procedures; and fitness memberships. Provincial health premiums are not eligible either.
Dependants, and the refundable top-up
Expenses for you, your spouse or partner and your children under 18 go on one line. Expenses for other dependants who relied on you for support, an adult child or a parent, go on a separate line where the floor is applied against that dependant's net income rather than yours. For a parent with a small income, the floor is small, which is why these claims are often more valuable than people expect.
Separately, a refundable medical expense supplement of up to $1,534 is available to working people with low incomes. It needs at least $4,478 of employment or business income and is reduced as family net income passes $33,960. Being refundable, it pays out even when no tax is owed, which is the opposite of the main credit.
Keep the receipts and do not file them. The CRA asks for them on review, and this is one of the credits it reviews most.
Where it sits
A credit at 14% is a weaker instrument than a deduction at your marginal rate, which is what an RRSP contribution gives you. It is worth claiming, not worth planning your health care around. For a self-employed person or an incorporated owner the alternative worth asking an accountant about is a private health services plan through the business, which is deductible to the business rather than credited at the lowest rate.
The credit is claimed at the lowest federal rate wherever you live, so unlike most of Canadian tax the province changes only the smaller half. Our income tax by province guide has the provincial rates.
Frequently asked questions
How does the medical expense tax credit work?
You add up eligible expenses for a 12-month period ending in the tax year, subtract the lesser of 3% of your net income and $2,890, and claim a non-refundable credit on the remainder at the lowest federal rate of 14%, plus your province's own credit.
Which spouse should claim medical expenses?
Usually the one with the lower net income, because the threshold is 3% of income until it is capped at $2,890. On $6,000 of expenses, claiming on a $45,000 income rather than a $120,000 one leaves $1,540 more to claim, worth about $293 in Ontario. The exception is a spouse with too little tax payable to use the credit.
What is the 3% rule?
Only expenses above a floor count, and the floor is 3% of your net income or $2,890, whichever is less. The cap means the floor stops rising once net income passes about $96,333, so above that everyone faces the same $2,890 threshold.
Can I choose which 12 months to claim?
Yes, and it is the most under-used feature of the credit. The period is any 12 months ending in the tax year, not the calendar year, so you can line the window up with a run of expenses that straddles December and clear the threshold once rather than twice.
What medical expenses are eligible?
Prescription drugs, dental work, eyeglasses and contacts, many practitioners' fees, premiums paid to a private health services plan including through work, travel for treatment that is not available locally, and attendant or nursing home care. Over-the-counter medication is not eligible even when a doctor recommends it, and neither are most gym memberships or cosmetic procedures.
Can I claim expenses for my children or parents?
Expenses for yourself, your spouse or common-law partner and your children under 18 go on line 33099. Expenses for other dependants who relied on you for support, including adult children and parents, go on line 33199, where the threshold is applied against each dependant's own net income.
Is the credit refundable?
The main credit is not: it reduces tax payable and no further. A separate refundable medical expense supplement of up to $1,534 exists for working people with low incomes, which needs at least $4,478 of employment or business income and is reduced once family net income passes $33,960.
Do I need receipts?
Keep them, but do not send them with the return. The CRA asks for them only on review, and it does ask: this is a commonly reviewed credit. A prescription or certification from a medical practitioner is required for some items.
Related guides
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Researching and writing about Canadian personal finance since 2026.
Last reviewed October 2026 · How we research
“Medical Expense Tax Credit (2026): Claim It on the Wrong Return and You Lose.” Vault Nerd, https://www.vaultnerd.com/ca/learn/medical-expense-tax-credit, updated October 2026.
- Canada Revenue Agency indexation chart: 2026 medical expense tax credit ceiling of $2,890, refundable supplement of $1,534 and its thresholds
- Canada Revenue Agency, Income Tax Folio S1-F1-C1, Medical Expense Tax Credit: the 12-month period, eligible expenses and the dependant rules
- Canada Revenue Agency RC4065, Medical Expenses, and the guidance for lines 33099 and 33199
- 2026 federal and provincial lowest-bracket rates, which set the value of a non-refundable credit
No product is reviewed on this page and Vault Nerd has no affiliate relationship in this category. This is general information, not advice on your own return. Figures checked October 2026.