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Budget 2026 proposes optional flat amounts for the medical expense credit: $1,000 a year for gluten-free food from 2026, $500 for incontinence products and $2,000 for a service dog from 2027. These are proposals, not law. Keep your receipts until the rules pass.
What does Budget 2026 propose for medical expense claims?
Budget 2026 was tabled on November 5, 2026. In the tax measures section it proposes optional flat amounts for three kinds of medical cost that today need receipts and, for gluten-free food, a calculation. You could claim the flat amount under the medical expense tax credit instead of itemizing.
| Expense | Proposed flat amount | Applies from |
|---|---|---|
| Gluten-free food for celiac disease | $1,000 per year | 2026 tax year |
| Incontinence products | $500 per year | 2027 tax year |
| Service dog expenses | $2,000 per year, under the medical expense credit or the disability supports deduction | 2027 tax year |
All three figures come from the Department of Finance tax measures document, which we read in November 2026. They are proposals. Nothing here is law yet, and the final wording, the amounts and the start years could change when legislation is drafted.
Is this law yet, and where does it stand?
No. As of November 12, 2026, these are budget proposals. The budget papers include notices of ways and means motions to amend the Income Tax Act, and we found no bill that has passed. A measure becomes law only after Parliament passes an implementation bill and it receives royal assent.
That matters most for the gluten-free amount, because it is proposed for 2026, the return you file in 2027. If you are deciding how much paperwork to keep for 2026, keep receipts anyway. If the flat amount becomes law and you choose it, the receipts are a spare. If it does not, you will need them. Our overview of Budget 2026 and your taxes lists the other proposals and tracks their status.
How do these costs work today?
The medical expense tax credit lets you claim eligible costs paid in any 12-month period ending in the tax year, minus a threshold. For 2025 the CRA threshold is the lesser of 3% of net income and $2,834. The 2026 figure has not been published in the pages we read. Our guide to medical expenses you can claim covers the rules in full.
- Gluten-free food: only the extra cost over a similar product with gluten counts. You need a letter from a medical practitioner certifying celiac disease and the need for a gluten-free diet, plus receipts and a summary of purchases.
- Incontinence products: catheters, catheter trays, tubing and similar products qualify when incontinence is caused by illness, injury or affliction, as the CRA lists them.
- Service animals: the CRA lists care and maintenance, including food and veterinary care, and some travel for training. The animal's special training must be one of the main purposes of the person or organization that provides it.
The practical problem is the bookkeeping. Working out the "extra" cost of gluten-free bread, or keeping a year of pet food and vet receipts, is the part many people skip, and so they leave money on the table.
What would a medical expense flat amount change on a return?
A worked example, using made-up figures, the 2025 threshold rule applied to a 2026 claim and no reimbursements. This is an illustration, not a forecast of your result.
Sam has net income of $60,000. The threshold is the lesser of 3% of net income ($1,800) and $2,834, so it is $1,800. In a 12-month period Sam paid $900 for dental work and $600 for prescriptions, and Sam has celiac disease with a physician's note.
| Method for gluten-free food | Gluten-free amount | Total expenses | Less threshold | Medical claim |
|---|---|---|---|---|
| Itemized extra cost from receipts | $780 | $2,280 | $1,800 | $480 |
| Proposed flat amount | $1,000 | $2,500 | $1,800 | $700 |
In this case the flat amount adds $220 to the claim, because Sam's real extra cost of $780 was below $1,000. If the real extra cost had been $1,300, itemizing would win. The budget calls the flat amount optional, so the better choice is whichever is larger, once you know the rules in the final law.
The same logic applies to the others. A person whose service dog food and vet bills came to $1,400 would do better with the $2,000 flat amount. A person whose incontinence products cost $620 would do better itemizing than taking $500. The budget text says the flat amount for a category replaces itemized claims for that category, with one exception we read: the cost of acquiring a service dog can be itemized separately, on top of the flat amount.
What rules come with the flat amount?
The tax measures document gives several conditions. Read them as the proposal, not as final law.
- It is optional. You can still itemize if that gives you more.
- Only one person can claim a flat amount for the same eligible person in the same category. If two people want to claim the same category for that person, the flat amount is not available, and each must itemize and keep receipts.
- The service dog amount covers dogs only. Costs for other service animals stay itemized.
- The service dog flat amount can be claimed under the medical expense credit or the disability supports deduction.
- Existing eligibility still applies. The budget describes no change to the certification a medical practitioner gives for celiac disease or incontinence, and it says nothing in the sections we read about whether certification is still needed to use the flat amount. We mark that as not confirmed.
The same budget section also proposes a change to documentation: for some items such as insulin and certain respiratory devices, the prescription requirement would be removed, and for others a certification of the condition would replace a prescription, from 2026. Those are separate from the flat amounts.
Who is likely to gain from the flat amounts?
People who now skip these claims because tracking is a chore are the obvious group. Others will find the flat amount smaller than their real costs and keep itemizing.
The credit is non-refundable. It reduces tax you owe and does not create a refund by itself, and a low earner with little tax may not use all of it. The medical expense threshold also still applies, so a flat $500 may add little if your other costs sit below the threshold. The medical expense credit calculator lets you test your own numbers with the flat amounts entered as ordinary expenses, which approximates the proposal.
What should I keep and do in the meantime?
Until the rules are final, behave as the current rules require.
- Keep every receipt for gluten-free products, incontinence supplies and service dog costs for the 2026 year.
- Ask your practitioner for the letter now if you do not have one. It is needed under today's rules.
- Note who in the family would claim, since only one person can claim a category for the same eligible person.
- Watch for the implementation bill and the CRA's 2026 guide on medical expenses. Our 2027 tax questions page collects such updates.
Where does this information come from?
Amounts, start years and conditions come from the Department of Finance Budget 2026 tax measures supplementary information, checked on November 12, 2026, and the chapter on a more affordable life. Today's rules come from the CRA pages on lines 33099 and 33199 and the medical expenses guide RC4065, checked in November 2026. The examples use invented figures and our own calculations. This is an independent information site: we provide no services, we do not represent the CRA or any organization, we collect information from open sources, and we do not guarantee that anything here is accurate or current. We accept no liability for decisions based on it. Check the official source before you rely on it.
Frequently asked questions
What is the proposed flat amount for gluten-free food?
Budget 2026 proposes an optional flat amount of $1,000 per year for people with celiac disease, instead of calculating the extra cost of gluten-free products from receipts. It would apply from the 2026 tax year. It is a proposal until legislation passes.
When would the incontinence and service dog amounts start?
Both are proposed for the 2027 and later tax years. The incontinence flat amount is $500 per year and the service dog flat amount is $2,000 per year. They would be claimed in 2028 on your 2027 return, and only if Parliament passes the measures.
Do I still need receipts if I take the flat amount?
The budget describes the flat amount as an alternative to itemizing, so you would not calculate or keep receipts for that category. We could not confirm whether a practitioner certification is still required. Keep receipts for now, because the measure is not law and may change.
Can I claim the flat amount and itemize the same category?
No, with one exception in the proposal. A flat amount for a category replaces itemized claims for that category. The cost of acquiring a service dog can be itemized separately and claimed in addition to the $2,000 flat amount in the same year.
Can two family members each claim the flat amount?
Not for the same eligible person and category. The proposal lets only one individual claim the flat amount for that person in a category. If more than one person wants to claim it, the flat amount is unavailable and each must itemize and keep receipts.
Is the medical expense credit refundable?
The medical expense tax credit is non-refundable, so it lowers tax you owe and cannot create a refund on its own. A separate refundable medical expense supplement exists for working people with low income and high medical costs. Check the CRA page for that supplement.