Hughes v. R. – TCC: Another Tax Court decision upholding a disability tax credit for phenylketonuria (“PKU”)

Hughes v. R. – TCC:  Another Tax Court decision upholding a disability tax credit for phenylketonuria (“PKU”)

Hughes v. The Queen (February 27, 2018 – 2018 TCC 42, Boyle J.).

Précis:   PKU is an incurable lifelong condition which if left untreated can cause a child to suffer permanent severe brain damage.  CRA denied Ms. Hughes the disability tax credit for her 15 year old daughter.  Ms. Hughes appealed to the Tax Court which allowed her appeal following the example of Justice Jorré in Mullings (reported earlier on this site).

Decision:   After a careful review of the evidence Justice Boyle reached essentially the same conclusions as Justice Jorré in Mullings:

Answers and Conclusions

1.    Therapy/Soins thérapeutiques

[57]         I conclude that the proper meaning of the word “therapy” (soins thérapeutiques) in the DTC provisions, read within the context of that provision in the DTC provisions, and in a manner consistent with the purpose of the DTC provisions which has already been determined by the courts, simply means the care or treatment of a physical or mental condition. That is consistent with dictionary definitions of the term, its use in common parlance including when talking about medical matters, and best achieves the purpose of the amendments to the DTC provisions which introduced the “but for therapy” extension to the scope of persons eligible to claim it. It is also consistent with the decision of Justice Jorré in Mullings. The Respondent did not put forward any substantive argument that this was not an appropriate definition or application.

[58]         I agree with Justice Jorré’s more detailed conclusions regarding the scope of qualifying activities in the case of the administration of therapy for a PKU child in Mullings. (I also agree with his conclusions on what does not qualify discussed below under heading 3.)

[59]         This is also consistent with CRA’s published pronouncements and illustrative examples of the scope of the term “therapy” (soins thérapeutiques).

2.    Marked Restriction in Mental Functions/Essential to Sustain a Vital Function

[60]         It is clear on the evidence that absent this therapy Gwynneth would have potentially devastating and irreversible adverse consequences to her proper mental development and functioning. Clearly the brain and its mental functions are vital and its normal functioning is sustained by this therapy.

3.    Excluding Dietary Restrictions or Regimes and Travel Time

[61]         None of Gwynneth’s treatment related to what can fairly be described as simply a dietary restriction, much less a dietary regime or anywhere close to carbohydrate reduction or calculation. I agree with the reasons of Justice Jorré in Mullings that, in the case of administering the necessary treatment of a PKU child with a PKU impairment as extensive as Gwynneth’s and the Mullings child, the overall counting and managing of Phe consumption through both medical foods and ordinary foods is much more like administering a medication than it is like managing a diet. I agree that this should extend to the time spent determining the amount of Phe to be consumed, determining the amount of Phe actually consumed, and logging the Phe intake.

[62]         Travel time is clearly an excluded activity even though a necessary part of the therapy. Travel time has been removed in computing the average weekly time spent on qualifying activities above for Gwynneth’s PKU treatment.

4.    The 14hour Average Weekly Requirement

[63]         For the reasons described above, I have found on the evidence in this case that the 14hour average requirement was met for the years up to the year the DTC eligibility application was made (2015).

[64]         This conclusion does not necessarily remain unchanged in the future. This may depend on the continuing success of Kuvan or other pharmaceuticals in treating Gwynneth’s disorder. It may depend upon changes in her overall health or the scope of her PKU disorder. It may also be that as a capable and experienced adult she is able to more efficiently administer the treatment herself.

[65]         The 14hour requirement is particular to each taxpayer and will not necessarily be met by each person afflicted with PKU even as a child. The evidence was clear that PKU disorder is not an allornothing inability to process Phe but that different people have different levels of inability to process Phe. This requirement will continue to have to be met on a casebycase basis.

5.    Marked Restriction in Feeding Herself

[66]         I do not need to decide this last question in this case. However, in circumstances such as Gwynneth’s PKU disorder, I would be very much inclined to think that feeding Gwynneth in her particular circumstances required an inordinate amount of time.

[67]         The DTC provision contemplates a person whose impairment may markedly restrict their ability to feed themself by requiring an inordinate amount of time to do so. There is no clear or apparent reason to think that this should be limited to impairment of the arms, jaw, or mouth, or related motor skills. An impairment that limits what the person is capable of processing as nutrition to fuel the body without causing severe and permanent bodily damage might well also be considered in giving a humane, compassionate and commonsense interpretation and application of this DTC provision.

As a result the appeal was allowed.  There was no order as to costs since this was an informal procedure appeal.