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Edited version of private ruling
Authorisation Number: 1011730200371
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Ruling
Subject: Medical Expenses
Question
Do the costs of conductive education for your disabled dependant qualify as an eligible medical expense for medical expenses tax offset purposes?
Answer: Yes.
This ruling applies for the following periods:
Year ended 30 June 2010
Year ending 30 June 2011
Year ending 30 June 2012
Year ending 30 June 2013
The scheme commenced on:
1 July 2009
Relevant facts and circumstances
Your dependant is confined to a wheelchair.
Your dependant is physically disabled, non verbal with behavioural and learning difficulties.
Your dependant attends a conductive education program as part of therapy to assist with co-ordination, speech, comprehension, body control, social skills as well as support for education and learning.
Your dependant was referred to attend a conductive education program by a physician.
The fees charged for the conductive education program are not covered by medicare or your private health insurance.
Relevant legislative provisions
Income Tax Assessment Act 1936 Section 159P
Reasons for decision
Summary
The conductive education program that your dependant was referred to is regarded as therapeutic treatment. Therefore, the out of pocket expenses that you have paid for your dependant attending the program qualifies as an eligible medical expense for medical expenses tax offset purposes.
Detailed reasoning
A medical expenses tax offset is available to a taxpayer under subsection 159P(1) of the Income Tax Assessment Act 1936 (ITAA 1936) where the taxpayer pays medical expenses in an income year for themselves or a dependant who is an Australian resident, to the extent that they are not reimbursed, or are eligible to be reimbursed, from a government or public authority or a society, association or fund.
The medical expenses tax offset is 20% of the amount by which the net medical expenses exceed $1,500 for the 2009-10 year of income. Please note that the threshold amount may change in future financial years.
The term medical expenses is defined in subsection 159P(4) of the ITAA 1936 to include payments made for therapeutic treatment administered by direction of a legally qualified medical practitioner.
It was held in Case A53 69 ATC 313; 15 CTBR (NS) Case 30 that the mere suggestion or recommendation by a medical practitioner that the patient undergoes therapeutic treatment is not sufficient for the payment to qualify as medical expenses. The patient would have to be referred by a medical practitioner to a particular person for specific treatment.
In the context of subsection 159P(4) of the ITAA 1936, therapeutic treatment involves the exercise of professional skill in the medical field in a way which normally involves the person administering the treatment using drugs or physical or mental processes of one kind or another for the purpose of curing or managing disease ( Case R95 84 ATC 633; (1984) 27 CTBR (NS) Case 148 ).
Furthermore, therapeutic treatment as a concept is concerned with healing or curing, rather than preventing the need for therapy (Case T67 (1967) 18 TBRD 346;(1967) 14 CTBR (NS) Case 31 ). Although the treatment must be administered by direction of a legally qualified medical practitioner, the treatment need not be administered by such a practitioner.
In your case, your dependant was referred through a General Practitioner to attend a conductive education program run by a specific rehabilitation consultant. The program assists your dependant with co-ordination, speech, comprehension, body control, social skills as well as support for education and learning and is regarded as therapeutic.
Therefore, the out of pocket expenses that you have paid for your dependant attending the conductive education program qualifies as an eligible medical expense within the meaning of subsection 159P(4) of the ITAA 1936 and you are entitled to include the cost in your calculation of the medical expenses tax offset.
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