Medical Expense Tax Credit (METC) in Canada (2026)

Medical expenses add up quickly. Prescriptions, dental work, glasses, therapy, medical devices, travel for treatment, and private health insurance premiums can all create costs that provincial health plans do not fully cover. The Medical Expense Tax Credit, usually called the METC, can reduce the after-tax cost of some of those expenses, but it is widely misunderstood.

The most common misunderstanding is what kind of relief it provides. The METC is not a refund and not a dollar-for-dollar reimbursement. If you paid $3,000 in eligible medical expenses, you do not get $3,000 back. You get a credit on the portion above a threshold, and that credit reduces the tax you owe. If you owe little or no tax, the benefit may be small.

This guide explains how the METC works, what you can and cannot claim, how health and dental insurance premiums fit in, who in a household should claim, and the mistakes worth avoiding.

Key takeaways

• The METC is a non-refundable tax credit, not a refund and not a deduction.
• Only eligible expenses above a threshold generate a credit, and the credit is a percentage of that amount, not the full amount.
• You can usually pool eligible expenses for yourself, your spouse or common-law partner, and your minor children, and claim certain other dependants separately.
• Premiums for a qualifying private health and dental plan can count as eligible expenses, but reimbursed amounts cannot.
• The credit is real but partial, so it should lower the cost of healthcare you were going to pay for anyway, not be the reason you buy coverage.

What the METC is, and why it is not a deduction

The METC reduces the income tax you owe based on eligible medical expenses you paid for yourself, your spouse or common-law partner, your minor children, and, in some cases, other dependants. It applies both federally and provincially or territorially, so a single claim can reduce both layers of tax.

A lot of people search for a medical expense "deduction," and the distinction matters because the two work differently. A deduction lowers your taxable income, so its value depends on your tax bracket. A credit lowers the tax you owe, calculated at a fixed rate. The METC is a credit: it does not reduce your income, and it does not refund your bills.

It is also non-refundable, which means it can reduce your tax to zero but generally cannot create a refund on its own. If you owe $800 in tax and have a $500 credit, your tax drops to $300. If you owe $200 and have a $500 credit, your tax drops to zero, but the unused $300 does not come back to you. This is why the credit may not help much when income and tax owing are low, though a separate refundable medical expense supplement may provide some relief to lower-income working Canadians even when little tax is owed.

How the credit is calculated

The calculation comes down to a threshold and a rate.

You do not get a credit on the first dollar of medical expenses. Federally, the threshold is the lesser of 3 percent of your net income or a fixed dollar amount that is indexed each year and has recently sat near $2,800 to $2,900, so confirm the current figure when you file. Whichever is smaller is subtracted from your eligible expenses, and only what remains generates a credit. That remaining amount is then credited at the applicable federal non-refundable credit rate for the tax year, and your province or territory adds its own credit on top, so the combined relief often works out to roughly a fifth of the above-threshold amount, depending on where you live.

Here is the practical shape of it. Suppose your net income is $50,000 and you had $4,000 of eligible expenses with no reimbursement. Three percent of your income is $1,500, which is lower than the fixed threshold, so you subtract $1,500. The credit applies to the remaining $2,500, not the full $4,000, and a province adds its share. The single most important point follows directly: the credit is partial relief on the amount above the threshold, never reimbursement of the whole expense. That is also why a year of modest expenses can produce little or no credit, because nothing clears the threshold.

What you can claim

The Canada Revenue Agency keeps a detailed list of eligible expenses, but it is easier to think in categories. Most claims fall into these, with the recurring rule that you can claim only the portion you paid and were not reimbursed for:

• Prescription drugs, when prescribed by a practitioner and dispensed by a pharmacist. Over-the-counter products generally do not qualify, even when bought for a real health reason.
• Dental care, including exams, fillings, extractions, root canals, crowns, dentures, and orthodontics. Purely cosmetic work, such as whitening, is generally not eligible. Our guide to how dental insurance works in Canada covers the coverage side of these costs.
• Vision care, such as eye exams, prescription glasses and contacts, and laser eye surgery. The word prescription matters; general comfort eyewear usually does not qualify.
• Practitioner and therapy services, including physicians, dentists, optometrists, psychologists, physiotherapists, chiropractors, and others. Eligibility can depend on how the practitioner is regulated in your province, so keep detailed receipts.
• Medical devices and equipment, such as hearing aids, CPAP machines, wheelchairs, prosthetics, orthotics, and diabetic supplies. Some require a prescription or written certification, not just a receipt.
• Travel for medical care not available near home. If you must travel at least 40 kilometres one way, certain transportation costs may qualify; at 80 kilometres or more, reasonable meals and accommodation may qualify too.
• Premiums for a qualifying private health and dental plan, covered in its own section below.

There are also more specialized claims, such as certain fertility treatments, attendant or long-term care, service animals, and accessibility renovations. These can be valuable but have detailed rules, so confirm the current CRA guidance for anything large or unusual. Eligible expenses are also not limited to Canada: amounts paid outside Canada can qualify if they meet the same CRA eligibility rules, such as being paid to an eligible practitioner or hospital, which is worth remembering if you pay out of pocket for treatment while abroad.

What you cannot claim

A cost can feel health-related and still be ineligible, which is where many mistakes happen. Generally not eligible: vitamins, supplements, and most over-the-counter products; gym memberships, fitness classes, and general wellness or weight-loss programs; cosmetic procedures done only for appearance; and premiums for life, disability, critical illness, or accident insurance. Reimbursed expenses are also out, as is any employer-paid premium that was never taxed in your hands. The test is not whether something supports your health in a broad sense; it is whether it meets the CRA's specific medical expense rules.

Health and dental insurance premiums

This is the part most relevant if you pay for your own coverage. Premiums for a qualifying private health services plan can count as eligible medical expenses. For tax purposes, a private health services plan is one where all or substantially all of the premiums relate to eligible medical expenses, often described as a 90 percent test, meaning it mainly covers things like drugs, dental, vision, hospital, and paramedical care. That is why a standard personal health and dental plan usually qualifies, while life, disability, and critical illness premiums do not: those pay financial benefits rather than reimbursing medical care.

Two cautions matter. First, claiming a premium does not give you the premium back; it simply adds to your total eligible expenses and is still subject to the threshold and rate. Second, if your employer paid part of the premium and it was not taxed to you, you cannot claim that part, only the portion you paid yourself. Because the premiums-with-METC question has its own details, our guide to claiming your health and dental premiums with the METC goes deeper, and our guide to how much health insurance costs explains where this fits into the real cost of a plan.

The reimbursement rule

You can claim only what you actually paid and did not get back. If a dental bill was $1,000 and your insurance reimbursed $800, your claimable amount is $200, not $1,000. The same applies to prescriptions, vision, physiotherapy, and anything reimbursed by an insurer, an employer plan, or a Health Spending Account. This is the rule that turns a large receipt into a small claim, and it is the one people most often get wrong. If a reimbursement is still pending when you file, be careful not to claim an amount you expect to get back; claim only what you ultimately pay yourself, and adjust later if needed.

Choosing your 12-month period

One of the most useful and least known features of the METC is that you do not have to use the calendar year. You can claim eligible expenses paid in any 12-month period that ends in the tax year, as long as those expenses were not claimed before. Most people default to January through December, but that is not always best.

Because the threshold applies once per claim period, clustering expenses into a single period can produce a larger credit than splitting them across two years. Suppose you paid $2,500 for dental work in December and another $2,500 for orthodontics the following February. Claimed by calendar year, each amount faces its own threshold in a different tax year, and neither may clear it by much. Choose a 12-month period that captures both, and you have $5,000 in one claim period, with only one threshold to clear. The rule to respect is simple: the same expense cannot be claimed twice, so track which period you used.

Who should claim

Within a household, one person can usually claim the pooled eligible expenses for both partners and their minor children, reported on line 33099. You do not have to split bills by who paid them. The common rule of thumb is that the lower-income partner should claim, because the 3 percent threshold is based on net income, so a lower income means a lower threshold and more expenses above it. To see why, take a couple who paid $4,000 in eligible expenses: at $80,000 income the threshold is $2,400, leaving $1,600 above it, while at $30,000 income the threshold is $900, leaving $3,100 above it.

The catch is that the credit is non-refundable, so the person claiming needs enough tax owing to actually use it. If the lower-income partner owes little or no tax, the credit is wasted, and the higher-income partner becomes the better choice despite the higher threshold. The goal is the largest usable credit, not simply the lowest threshold. Expenses for certain other dependants, such as an adult child, a parent, or a grandparent who relied on you for support, are claimed separately on line 33199, under their own rules. One point there is easy to miss and often valuable: the 3 percent threshold for a dependant on line 33199 is based on that dependant's net income, not yours, so a higher earner can still benefit from claiming a low-income parent's expenses, where a small income makes for a low threshold. Families carrying significant ongoing costs may find our guide to health insurance for families and children a useful companion on the coverage side.

Self-employed Canadians: credit or deduction?

If you run your own business, you have a choice most taxpayers do not. You can claim eligible unreimbursed medical expenses personally through the METC, like anyone else, or you may be able to deduct qualifying private health services plan premiums as a business expense instead. A deduction reduces business income directly, which for many self-employed people produces a larger benefit than the personal credit, since it is not subject to the threshold. The rules are specific and depend on your structure, your income, and whether you have employees, and you cannot claim the same premium both ways. Our guide to deducting health insurance premiums when you are self-employed walks through when the business deduction is available, and our broader guide to health insurance for self-employed Canadians covers the rest.

How to claim the METC

The mechanics are straightforward once your records are in order:

• Gather receipts and premium statements for everyone you are claiming, covering your chosen 12-month period.
• Subtract any reimbursements from insurance, an employer plan, or an HSA, and keep only the out-of-pocket amount.
• Pick the 12-month period that captures the most expenses, as described above.
• Decide who claims, testing the lower-income partner first but confirming they have enough tax owing to use the credit.
• Enter the totals on line 33099 for yourself, your partner, and minor children, or line 33199 for other dependants. You do not send receipts with your return, but keep them in case the CRA asks.

Tax software will usually calculate the federal and provincial or territorial amounts for you once the expenses are entered correctly.

Common mistakes to avoid

• Expecting a full refund. The METC reduces tax on expenses above the threshold; it does not hand back what you spent.
• Overlooking the threshold. Expenses below it produce no credit, which surprises people who had real costs.
• Claiming the full bill after a reimbursement. Claim only the out-of-pocket portion left after insurance or an HSA.
• Claiming ineligible costs. Vitamins, wellness, cosmetic work, and non-medical insurance premiums generally do not qualify.
• Defaulting to the calendar year. When big expenses straddle two years, a different 12-month period can be worth more.
• Splitting the claim or picking the wrong claimant. Test the lower-income partner first, but make sure they have enough tax owing to use it.

Frequently asked questions

Are medical expenses tax deductible in Canada?

In everyday language people say "deductible," but the relief is the Medical Expense Tax Credit, a non-refundable credit rather than a deduction. It reduces tax owing on eligible expenses above a threshold; it does not reduce your income or refund your costs in full.

What is the METC threshold?

Federally, it is the lesser of 3 percent of your net income or a fixed dollar amount that is indexed each year and has recently been near $2,800 to $2,900. Provinces and territories apply their own thresholds and rates for their portion, so confirm the current figures when you file.

Can I claim health and dental insurance premiums?

Often, yes, if the plan qualifies as a private health services plan and you paid the premiums yourself. They are added to your eligible expenses rather than refunded, and life, disability, and critical illness premiums generally do not qualify.

Can I claim expenses my insurance reimbursed?

No. You can claim only the amount you paid and were not reimbursed for. If insurance covered part of a bill, claim only the remaining out-of-pocket portion.

Should the lower-income spouse claim?

Usually it is worth testing first, since a lower income means a lower threshold. But because the credit is non-refundable, that person needs enough tax owing to use it; otherwise the higher-income spouse may be the better claimant.

Can self-employed Canadians deduct premiums instead?

Sometimes. A qualifying business may deduct private health services plan premiums as a business expense, which can be worth more than the personal credit, but you cannot claim the same premium both ways.

Do I need to send receipts to the CRA?

Not when you file, but keep them. The CRA can ask for receipts, premium statements, reimbursement records, and prescriptions later, so hold onto your documentation.

Can I claim medical expenses paid outside Canada?

Yes, medical expenses paid outside Canada may qualify if they meet the CRA's eligibility rules. Keep detailed receipts, and make sure the provider, service, or item would qualify the same way it would in Canada.

Bottom line

The Medical Expense Tax Credit can meaningfully reduce the after-tax cost of healthcare, but it is partial relief, not reimbursement. It applies only above a threshold, only to the portion you actually paid, and only to expenses the CRA recognizes. The way to get the most from it is straightforward: track eligible expenses through the year, include qualifying premiums, subtract any reimbursements, choose the best 12-month period, and have the right person claim. Used that way, it is a genuine help, especially in a high-expense year. It just should not be the reason you buy insurance.

Compare health and dental insurance with Aeva

If you already pay for private health or dental coverage, qualifying premiums may count toward your eligible medical expenses and lower the after-tax cost. Tax treatment is a bonus, though, not the point: the reason to hold coverage is to manage real costs like prescriptions, dental, vision, paramedical care, and emergency travel medical. Aeva lets you compare health and dental plans from leading insurers side by side, so you can see what each one costs and covers. See your plans on Aeva and compare in minutes.