During tax season, we all hope to receive a nice little return from the Government. At the very least, we hope to not owe them anything. Turns out, if you use marijuana for medical purposes, your tax return could receive a bit of a boost.
In 2015, the Canadian Revenue Agency confirmed that medical marijuana purchased with a prescription, from a licensed producer, could be claimed at tax time. Although this may be old news to some, the quieting stigma of cannabis use likely means this is a revelation to those who have recently begun exploring medical marijuana for ailments like glaucoma, migraines, chronic pain, and anxiety, to name a few.
What do you need to know?
Firstly, it’s important to understand which items can be claimed on your tax return. Cannabis seeds, plants, oils, and dried cannabis are good to go. However, such things as cannabis storage solutions, lights, pipes, fertilizers, vapes, and other similar accessories can’t be claimed.
Once you sift through your receipts and come up with the amount of money you’ve spent on medical marijuana, add that total to the other eligible medical expenses on your T1 Income Tax and Benefit Return. These medical expenses do not need to be calculated by the calendar year. Rather, they need to be calculated by any 12-month period ending in the current tax year.
For those of you who use tax software, keep an eye out in the deductions and credits section – this is where you’ll be adding your medical expenses.
What will you get back?
Please be aware that you will be unable to claim every dollar you spent on medical marijuana. Rather, you must take the full amount you spent on it and subtract the lesser of $2,268 or 3% of your net income – this will reveal what you can get back.
To learn more about eligible medical expenses that you can claim on your tax return, click here to visit the official Government of Canada website.