Is Massage Therapy Tax Deductible in Canada?

By: Updated: November 24, 2021

Massage therapy as an eligible medical expense on your tax return varies by province. If eligible, the expense is calculated through the Medical Expense Tax Return (METC), which leaves you with a tax credit to be applied to any tax owing. Massage therapy cannot be used as a tax deduction directly to your tax return.

 

Which provinces qualify massage therapy as an eligible expense?

Massage therapist services qualify for the METC in the following provinces:

  • British Columbia
  • New Brunswick
  • Newfoundland and Labrador
  • Ontario
  • Prince Edward Island 

 

What is the Medical Expense Tax Credit (METC)?

The Medical Expense Tax Credit (METC) is a non-refundable tax credit applied through your personal tax return. Since it is non-refundable, it can be subtracted from your tax owed, but cannot bring your tax balance above 0. If you incur medical expenses that qualify under the Income Tax Act, you may make a claim for this tax credit.

 

How does the Medical Expense Tax Credit (METC) work?

If you incur medical expenses that qualify under the Income Tax Act, you may make a claim for a tax credit on the amount of expenses that exceeds the lesser of 3% of your net income or $2,397. After, multiply the lowest marginal tax rate of your province (10% for the case of Alberta) + federal (15%) to the amount that exceeds the threshold. This number is your METC.

 

Example METC Calculation

Net Income = $100,000

Eligible Medical Expenses = $4,000

Province = Alberta = 10% = 0.1

Step 1: $100,000 * 0.03 = $3,000

Step 2: Compare $3000 with $2,397

Step 3: Pick the lower number, therefore, A2 = $2,397

Step 4: $4,000 - $2,397= $1,603

Step 5: $1,603 * (0.1 + 0.15) = $400.75 = METC

In this case, you have a non-refundable Medical Expense Tax Credit amount of $400.75.

Want to find out your personal METC amount? Try our METC Calculator here.

 

Are you incorporated in Canada?

Small business owners and incorporated individuals in Canada can use a Health Spending Account (HSA) to save up to 40% of their medical expenses.  An HSA has no premiums and it is a cost effective alternative to traditional health insurance.  The plan covers a wide variety of health and dental expenses.  An HSA takes only a few minutes to set up.  Learn more by downloading one of our guides.

 

Learn more about a Health Spending Account by downloading a free guide:

Download the HSA Guide for Incorporated Individuals Download the HSA Guide for a Business with Staff

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