Disability Tax Credit

What if I applied for the disability tax credit after i was discharged from bankruptcy and CRA was one of my former creditors.  Can I still go back 10 years and would the funds be mine because i was discharged?

If your disability tax credit is retroactive to a period before your bankruptcy, it is likely that Canada Revenue Agency will offset any refund from the prior period against their debt to the maximum of what the refund is or to the extent of the debt.  This is a legal right the Canada Revenue Agency would have.

Any refund that would be applicable after your bankruptcy is yours, except for any portion that the Trustee may be entitled to that relates to the post-bankruptcy period.  Even if you didn’t owe the tax department any money in your bankruptcy, you would not be entitled to the refund that relates prior to your bankruptcy in any event as it would be sent to your Trustee.  Having said that, no matter what your entitlement to the refund is, you should apply for the Disability Tax Credit if you think it will be beneficial to you.

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