Principal Issues: For purposes of the Refundable Medical Expense Supplement, more particularly for the definition of "adjusted income", whether spouses or common-law partners, one of whom died during the year, qualify as "cohabiting spouse or common-law partner" at the end of that year.
Position: No.
Reasons: When a marriage or a common-law partnership is dissolved by the death within one year of either spouse or common-law partner, we are of the view that they do not qualify as "cohabiting spouse or common-law partner" at the end of that year for purposes of the definition of "adjusted income".
XXXXXXXXXX 2018-075347
January 24, 2023
Dear XXXXXXXXXX,
Subject: Refundable Medical Expense Supplement - Death and the Concept of "cohabiting spouse or common-law partner”
This letter is in response to Mr. XXXXXXXXXX's email of April 4, 2018 requesting our comments regarding the refundable medical expense supplement ("RMES") under section 122.51 of the Income Tax Act (the "Act").
All statutory references herein are to the provisions of the Act.
Referring to Technical Interpretation 2014-0536771E5, XXXXXXXXXX asked more specifically whether spouses or common-law partners, one of whom died during the year, qualify as a "cohabiting spouse or common-law partner" within the meaning of the definition in section 122.6 at the end of that year for the purposes of the definition of "adjusted income", which, under section 122.51, has the meaning assigned by section 122.6.
Our comments
This technical interpretation provides general comments about the provisions of the Act and related legislation. It does not confirm the income tax treatment of a particular situation involving a specific taxpayer but is intended to assist you in making that determination. The income tax treatment of particular transactions proposed by a specific taxpayer will only be confirmed by this Directorate in the context of an advance income tax ruling request submitted in the manner set out in Information Circular IC70-6R12, Advance Income Tax Rulings and Technical Interpretations.
Section 122.51 provides an amount of RMES to low-income individuals who incur high medical expenses in the taxation year where certain conditions are satisfied.
The amount of the RMES to which an individual is entitled may be reduced based on the individual's "adjusted income". Subsection 122.51(1) defines "adjusted income" within the meaning assigned by section 122.6 as generally the total of all amounts each of which would be the income for the year of the individual or of the person who was the individual's "cohabiting spouse or common-law partner" at the end of the year.
The expression "cohabiting spouse or common-law partner" is defined in section 122.6 as the person who at any time is the individual’s spouse or common-law partner and who is not at that time living separate and apart from the individual. For the purposes of this definition, a person is considered to be living separate and apart from an individual at a particular time only if the person is living separate and apart from the individual at that time, because of a breakdown of their marriage or common-law partnership, for a period of at least 90 days that includes that time.
Where a marriage or common-law partnership is dissolved by the death in a year of one of the spouses or common-law partners, we are of the view that those spouses or common-law partners do not qualify as a "cohabiting spouse or common-law partner" within the meaning of the definition in section 122.6 at the end of that year for the purposes of the definition of "adjusted income".
Therefore, the position set out in Technical Interpretation 2014-0536771E5 no longer represents the position of the Canada Revenue Agency.
Best regards,
Isabelle Landry
Acting Manager
Business and Employment Income Division
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch