Claiming HVAC Equipment as a Medical Expense in Canada

All Canadians know that certain HVAC equipment is necessary not just for comfort but also for survival. Just imagine trying to get through winter without some kind of heat source like a furnace or boiler!

What’s more, poor indoor air quality can cause acute and chronic health issues, which is why air purification systems are becoming increasingly popular in homes. 

Beyond that, people can also have health issues that make certain HVAC systems necessary, and you can often claim such HVAC equipment as a medical expense.

However, before you go out and buy a new furnace or air conditioner, it’s important to ensure you’re eligible and understand the process. In this article, we’ll explore what HVAC equipment might qualify as a medical expense, what you need to claim the expenses, documentation required by the Canada Revenue Agency (CRA), and more.

When You Might Be Able to Claim HVAC Equipment as a Medical Expense

In Canada, HVAC equipment like air conditioners, furnaces, and air purifiers can be claimed as eligible medical expenses under the Medical Expense Tax Credit if certain conditions are met.

Two of the most important conditions are these:

1. The equipment must be prescribed by a medical practitioner
2. The equipment must be used to treat or alleviate a specific medical condition

In other words, the equipment must be medically necessary and not just for comfort. A doctor might prescribe HVAC equipment as a medical expense for people with:

• Asthma
• Chronic obstructive pulmonary disease
• Allergies
• Cystic fibrosis
• Sleep apnea
• Chronic sinus conditions
• Heart disease
• Multiple sclerosis
• Chronic skin problems
• Immune disorders

Eligible HVAC Equipment and Components

Depending on the medical condition, a doctor might prescribe heating, cooling, or air purification devices. Here are some examples of HVAC equipment as a medical expense you might be able to claim:

• Furnace that is electric or has a sealed combustion chamber to manage chronic respiratory issues or immune disorders
• Air conditioner that removes humidity, cools the air, and provides filtration to manage multiple sclerosis, asthma, cardiovascular conditions, heat sensitivity, and immune disorders. You could be eligible for $1,000 or 50% of the amount paid
• Air purifier, UV light, or HEPA filtration system that removes allergens, dust, mold, and other particulates from the air to manage allergies, asthma, COPD, and immune disorders
• Humidifier that adds moisture to the air to manage dry skin, eczema, nosebleeds, or respiratory issues
• Dehumidifier that removes moisture from the air to manage mold allergies, asthma, or chronic sinusitis
• HRV or ERV that increases ventilation to manage asthma or respiratory infections

Partial vs. Full Deductibility

If the entire HVAC system is only for medical purposes, then the CRA may allow you to claim the full amount of the HVAC equipment as a medical expense. However, if some of the HVAC equipment also provides general household benefit and isn’t related to the medical treatment, then you may only be eligible for a partial deduction.

For example, let’s say your doctor has prescribed an air purifier, and you buy a new furnace plus the prescribed HEPA filter. In that case, you will only be able to claim the filter.

What’s more, installation costs may not be eligible. But there are additional tax credits you might qualify for, like the Home Accessibility Tax Credit, that could cover renovations required to install the medically necessary equipment.

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Other Relevant Tax Credits

Speaking of other tax credits, there are several that can potentially be used to cover the cost of HVAC equipment.

1. Medical expense tax credit: A non-refundable tax credit for people who have incurred a lot of medical expenses. It’s used to reduce the amount of taxes owed.
2. Disability tax credit: A non-refundable tax credit that helps reduce the amount of taxes you owe if you have a disability.
3. Canada caregiver credit: A non-refundable tax credit that supports people who support a spouse with a physical or mental impairment.
4. Home accessibility tax credit: This allows seniors and people with disabilities to claim expenses for qualifying renovations to make a dwelling accessible.
5. Refundable medical expense supplement: A refundable tax credit for low-income people who have incurred medical expenses.
6. Disability supports deduction: This allows people with disabilities who have incurred medical expenses to claim those expenses on their taxes.

How to Claim HVAC Equipment as a medical Expense on Your Tax Return

You can claim HVAC equipment as a medical expense by filling out Line 33099 of your federal tax return. You can claim the total of the eligible expenses minus $2,759 or 3% of your net income, whichever is lower.

If you incurred medical expenses on behalf of a spouse, common-law partner, or dependent, you can claim that amount on Line 33199 of your federal tax return. Similarly, you can claim the total of the eligible expenses minus $2,759 or 3% of their net income, whichever is lower.

Documentation the CRA Will Require for You to Claim HVAC Equipment as a Medical Expense

To claim HVAC equipment as a medical expense, there are certain documents you’ll need. However, don’t send these documents to the CRA. Just keep them on file for at least six years in case the CRA asks to see them. Here are the documents you’ll need:

• Receipts for the equipment showing the date, purpose of the payment, patient’s name, and the medical practitioner who prescribed the purchase
• Prescription from a medical practitioner
• Proof of payment

What’s more, some medical expenses also require:

• Certification in writing from a medical practitioner
• Disability Tax Credit Certificate

Getting Professional Help with Your Claim

If you have questions about claiming HVAC equipment as a medical expense, call the CRA directly or consult with a tax advisor or accountant who’s familiar with medical claims. That will help ensure you get the most money back possible to cover your expenses.

Further, while the CRA may not ask to see documentation up front, you’ll need everything on file in case they request the information later, and talking to a professional or the CRA will make sure you’ve got everything.

Conclusion

Claiming HVAC equipment as a medical expense in Canada is possible as long as you meet the requirements, including having a prescription from a doctor and a medical condition the equipment will help manage. Before making any purchases, be sure to consult with a medical professional and consider speaking with a tax advisor to ensure your expenses qualify. With the right guidance and paperwork, you can take advantage of the available tax credits and deductions to support your health and comfort at home.

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