METC at federal + provincial rates.
METC credit
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Eligible after-floor
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Your breakdown
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Why most of your medical bills never reach the credit
The Medical Expense Tax Credit is a non-refundable credit, and it deliberately ignores the first slice of your spending. The CRA reduces your eligible expenses by a floor equal to the lesser of 3 percent of your net income or a fixed cap of $2,759 for 2026. Only the spending above that floor earns the credit. That design means routine, modest medical costs rarely produce a credit at all; the relief is aimed at years when a real medical burden lands. This tool computes the floor, subtracts it, and applies the federal and provincial credit rates to whatever remains.
The 3 percent floor and where the cap takes over
The floor moves with your income until it hits the ceiling. At a net income of $80,000, 3 percent is $2,400, which is below the $2,759 cap, so the floor is $2,400. The cap only becomes the binding number once your net income exceeds roughly $91,967, because that is where 3 percent first reaches $2,759. Below that income, every extra dollar you earn lifts your floor by 3 cents and quietly shrinks your credit. This is the mechanical reason the credit is worth more on a lower-income return.
Working $8,000 of expenses on an $80,000 income
Suppose you incurred $8,000 of eligible medical expenses and your net income is $80,000. The credit is built in three moves: find the floor, subtract it, then apply the combined credit rate. The federal rate is 15 percent. Provincial credits vary, and this tool uses an approximate 8 percent to stand in for the typical provincial component, giving a combined 23 percent.
The federal 15 percent rate is exact; the provincial portion genuinely differs by province, so treat the $448 as a reasonable estimate rather than a precise figure for your return. Note that because it is non-refundable, this $1,288 can only reduce tax you actually owe. It will not generate a refund cheque on its own if your tax is already nil.
Who benefits, and the surprising breadth of eligible costs
This tool is most useful for families pooling a year of health costs and for anyone with a single expensive medical event, since those are the situations where the credit actually pays. A point that surprises many people is the breadth of what qualifies. Beyond the obvious prescriptions, dental work, and glasses, the CRA list includes things like travel costs to obtain medical care not available locally, certain renovations to make a home accessible, attendant care, and premiums you pay for private or travel medical insurance. Conversely, over-the-counter medicines without a prescription and most purely cosmetic procedures do not count, which trips up first-time claimants. Keep every receipt, since the CRA can ask you to back up the claim even though you do not file the receipts with the return.
The lower-income-spouse move, with one caveat
The strategic step worth repeating is to combine the whole family’s eligible expenses on one return, almost always the lower-income spouse, because the 3 percent floor is calculated on that person’s net income and a lower income means a lower floor and a larger credit. There is a caveat, though. Because the credit is non-refundable, it can reduce tax to zero but not below. If the lower earner has very little tax to begin with, the credit can be partly wasted, and the optimal claimant shifts to the spouse who actually owes enough tax to absorb it. Run it both ways when the incomes are far apart.
Questions worth answering before you file
Can I pick which 12-month period to claim?
Yes, and it is an underused lever. You may claim expenses for any 12-month period ending in the tax year, not just the calendar year. If a major dental bill fell in November and another in February, choosing a 12-month window that captures both lets you clear the floor once instead of twice. Pile expenses into a single claim period rather than splitting them across two returns where each is dragged down by its own floor.
What about expenses the provincial health plan already covered?
Only the portion you actually paid out of pocket and were not reimbursed for is eligible. If a private insurer or a provincial plan covered part of a cost, you claim only your share, and premiums paid to a private health plan can themselves often be eligible. Cosmetic procedures that are purely elective are generally excluded, and Quebec residents should note that Revenu Quebec runs a parallel medical credit with its own rules, so a Quebec return is computed separately from the federal one.