ATO Interpretative Decision

ATO ID 2002/332 (Withdrawn)

Income Tax

• This ATO ID is withdrawn as the interpretative issue is covered by TR 93/34.
  This document incorporates revisions made since original publication. View its history and amending notices, if applicable.

Issue

Is the taxpayer entitled to claim a medical expense tax offset under section 159P of the Income Tax Assessment Act 1936 (ITAA 1936) for expenses incurred in installing a personal lift?

Decision

Yes. The taxpayer is entitled to claim a medical expense tax offset under section 159P of the ITAA 1936 for expenses incurred in installing a personal lift as the expense is considered to be in respect of a medical or surgical appliance.

Facts

The taxpayer is confined to a wheelchair and was unable to access the second floor of their home.

The taxpayer's doctor stated that a personal wheelchair lift was required in the taxpayer's home.

The taxpayer purchased and installed a personal lift. The lift is specifically built and advertised as 'Lift for people with limited mobility' and is GST-free. The cost of the lift and installation exceeded $1250.

Building works expenses were incurred in preparation for the installation.

Reasons for Decision

A medical expenses tax offset is available to a taxpayer under section 159P of the ITAA 1936, where the taxpayer incurs medical expenses in an income year for themselves or a dependant who is an Australian resident. The medical expense tax offset is only available if the amount of medical expenses (reduced by any entitlement to reimbursement from a health fund or government authority) in an income year exceeds $1250. The tax offset is 20% of the amount by which the net medical expenses exceed $1250 for that income year.

Subsection 159P(4) defines 'medical expenses' to include 'payments made in respect of a medical or surgical appliance prescribed by a legally qualified medical practitioner'.

Taxation Ruling TR 93/34 explains the meaning of a 'medical or surgical appliance' as being an instrument, apparatus or device which is manufactured, distributed or generally recognised as an aid to the function or capacity of a person with a disability or an illness.

Taxation Ruling TR 93/34 also provides that generally, a household or commercial appliance is not a 'medical or surgical appliance; and that we need to look at the character of the appliance, not the purpose for which it is proposed or used.

The lift has been manufactured, is sold specially and is generally recognised as an aid to those people who have a mobility impairment. Its character is to aid a mobility impaired person overcome obstacles such as staircases.

The purchase and use of the personal lift was prescribed for the taxpayer by a legally qualified medical practitioner and the taxpayer uses it as an aid to their mobility within their home. The personal lift meets the requirements of a 'medical or surgical appliance'.

Accordingly, the expenses incurred in purchasing and installing the personal lift are a medical expense. As the net medical expenses for the income year exceeded $1250, the taxpayer is entitled to a medical expense tax offset under section 159P of the ITAA 1936.

Legislative References:
Income Tax Assessment Act 1936
   subsection 159P(1)
   subsection 159P(4)

Related Public Rulings (including Determinations)
TR 93/34

Keywords
Aids for the disabled
Medical expenses
Medical expenses rebates

Business Line:  Small Business/Individual Taxpayers

Date of publication:  28 March 2002

ISSN: 1445-2782