Preface: I am writing this in a careful way, since the firms I am NOT mentioning by name seem quite litigious in nature (i.e. they like suing folks), and I am a simple Gonzo Personal Finance Blogger, but I am very UNHAPPY to read of these “services”, the claim to help get their clients their Disability Tax Credit, but for ludicrous fees. There is an ACT in place Bill C-462 : Protecting Disabled Canadians or a Paper Tiger ? but it seems to be inactive.
I have written about getting the Disability Tax Credit from the CRA and the steps I have to take to receive them for my son, and I may have portrayed the process as being extremely hard ( it can be), however, I have inadvertently also brought into play a whole new Service Provider, that of the “Disability Tax Credit Adviser”.
These Advisory firms offer their services, which at first blush seem genuine, to help folks who are disabled (or parents of disabled folks) get their Disability Tax Credits from the CRA. While these firms seem to want to help people who are disabled get the tax breaks that they deserve, they do it for a very steep price.
Most of these services will not charge a “client” anything up front, and they will either help your Doctor fill in the forms, or better still they will supply their own “Doctor” for a diagnosis. This again sounds fair enough, in that some Doctors may not know the correct verbiage to use, however, this still must be the professional’s opinion (as they are the one who signs the form).
The Official BCM Seal of Disapproval.
What might be the Disability Tax Credit Service company’s “cut” ? I have a few samples from a few of the sites I am aware of:
- “…our fee is 20% of the amount you receive…”
- Others can charge up to 30% “of the amount you receive”
This (in my opinion) is a ridiculously high fee for a service that can be done by yourself (or by an accountant). If you go to the Testimonial sections of many of these sites, you will see that folks can receive large settlements from the CRA, (upwards of $10,000), however, these companies will then ask to be paid 20% of the settlement or $2000.
I am worried that folks who are “at wits end” might turn to one of these firms, when they should do it themselves, or maybe they should contact an Accountant (or Tax expert (like H&R Block)) to try to get their Tax Credits.
There are allegations that the “commission” charged, by some of these firms, is not just on Disability Tax Credit portion of the tax refund, it is in fact 20-30% of ALL of the tax refund received by the “client”. There are now stories coming forward of the CRA auditing the Disability Claims prepared by some of these firms, and the CRA disallowing the claims (and asking for all settlement money be returned to the CRA (the whole credit, including any fees paid)).
I have been quite critical of the Pay Day Loan services, for being Vultures preying on desperate people, but if the allegations that I have read are true (I include links to articles in the Star and the CBC for you to form your own opinions) these folks should have a special place in Hell for taking advantage of Disabled Folks (and their families), this way. Let me be a little more clear:
I implore anyone seeking help to receive the Disability Tax Credit to not use any service that charges a “percentage of settlement” fee for their services.
Do it yourself!!! Or Find a service with a set flat fee!
Articles from newspapers about some “Disability Tax Credit Services” firms and the allegations levelled against them:
If there are folks who have used these services, please feel free to leave a comment about your experience.
I noticed a while back that many of these “Disability Tax Credit Service Companies” seem to come up in advertising on my site (especially those articles that talked about the RDSP or Disability Tax Credit), and these firms advertise themselves as an advocate for disabled Canadians. I have blocked their ads and as new firms come up, I will investigate (as best I can) and will block any that I feel charge a ridiculous service fee.
If there are other ads on this site you find offensive, feel free to leave a comment, I will investigate them and block them, if I agree with you.