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Individual tax return instructions 2013
Net medical expenses are your total medical expenses less refunds from Medicare and private health insurers which you, or someone else, received or are entitled to receive.
Medical expenses do not include contributions to a private health insurer, travel or accommodation expenses associated with medical treatment, or inoculations for overseas travel.
The way this tax offset is calculated has changed.
If you are entitled to claim a tax offset for your net medical expenses, we will work it out for you using the information you provide at this question.
The percentage of net medical expenses you can claim is now determined by your adjusted taxable income (ATI) and family status. See table 1 for more information.
For the full meaning of ATI and how it is calculated, see Adjusted taxable income (ATI) for you and your dependants.
Use table 1 to work out whether you can claim this tax offset.
(single at 30 June 2013 and no dependent children)
$84,000 or less
20% of net medical expenses over $2,120
10% of net medical expenses over $5,000
(with a spouse at 30 June 2013, or dependent children at any time during the year, or both)
$168,000* or less
* plus $1,500 for each dependent child after the first.
For the purpose of calculating the ATI threshold, a dependent child is your:
regardless of their income.
There is no upper limit on the amount you can claim.
When calculating your net medical expenses you can only include an amount paid for your dependants who were Australian residents for tax purposes.
The medical expenses must be for:
*For the meaning of ATI and how it is calculated, see Adjusted taxable income (ATI) for you and your dependants.
You and your dependants must be Australian residents for tax purposes, but you can include medical expenses paid while travelling overseas.
You can include medical expenses relating to an illness or operation paid to legally qualified doctors, nurses or chemists and public or private hospitals. However, expenses for some cosmetic operations are excluded.
To find out which operations, dental services and treatments are cosmetic and whether you can include your payments for them, see Net medical expenses: claims for cosmetic surgery or phone 13 28 61.
Medical expenses include payments:
Expenses which do not qualify as medical expenses include payments made for:
You can include payments made to nursing homes or hostels (not retirement homes) for an approved care recipient’s permanent or respite care if the payments were:
An approved care recipient’s residential aged care payments usually include an amount for personal or nursing care if the recipient has an aged care assessment team (ACAT) assessment that they require either low or high-level care.
Residential aged care payments can be for:
The following are expenses which cannot be included:
To help you work out what medical expenses you paid in 2012–13, you can ask for an itemised statement from:
Some of the items shown on these statements may not qualify as medical expenses for the purpose of claiming the tax offset. You will need to exclude these items when calculating your allowable medical expenses.
You will need to provide the amount of your net medical expenses. We will work out your tax offset for you based on your ATI and family status.
To work out your net medical expenses, you can use the Net medical expenses tax offset calculatorThis link opens in a new window or use the worksheet below.
Add up all your allowable medical expenses.
Add up all the refunds of these expenses which you or any other person has received or are entitled to receive.
Take (b) away from (a). This is your net medical expenses amount.
Write the amount of your net medical expenses at X item T6. Do not show cents.
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