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Edited version of your written advice
Authorisation Number: 1012735916388
Ruling
Subject: Net medical expenses tax offset
Question
Do amounts paid for travel to attend medical appointments qualify for inclusion in the calculation of the medical expenses tax offset?
Answer
No.
This ruling applies for the following periods
Year ended 30 June 2011
Year ended 30 June 2012
The scheme commences on
1 July 2010
Relevant facts and circumstances
You are an Australian resident for tax purposes.
As a result of an accident you were required to attend ongoing appointments with your legally qualified medical practitioners (specialists) and physiotherapist.
You have out-of-pocket expenses in relation to the travel costs.
You were not reimbursed by Medicare or your private health insurer for your travel costs.
Relevant legislative provisions
Income Tax Assessment Act 1936 Section 159P
Income Tax Assessment Act 1936 Subsection 159P(1)
Income Tax Assessment Act 1936 Subsection 159P(4)
Reasons for decision
A medical expenses tax offset is available under subsection 159P(1) of the Income Tax Assessment Act 1936 (ITAA 1936) where the taxpayer pays eligible medical expenses in an income year for themselves or a dependant who is an Australian resident. The medical expenses tax offset is only available if the amount of medical expenses, after being reduced by any entitlement to reimbursement from a health fund or government authority such as Medicare, exceeds the threshold amount.
Subsection 159P(4) specifically defines medical expenses which are eligible for the medical expenses tax offset as payments:-
(a) to a legally qualified medical practitioner, nurse or chemist, or a public or private hospital, in respect of an illness or operation; or
(b) to a legally qualified dentist for dental services or treatment or the supply, alteration or repair of artificial teeth; or
(c) to a person registered under a law of a State or Territory as a dental mechanic in respect of charges lawfully made by that person for the supply, alteration or repair of artificial teeth; or
(d) for therapeutic treatment administered by direction of a legally qualified medical practitioner; or
(e) in respect of an artificial limb (or part of a limb), artificial eye or hearing aid; or
(f) in respect of a medical or surgical appliance (not otherwise specified in this definition) prescribed by a legally qualified medical practitioner; or
(g) for:
(i) the testing of eyes or the prescribing of spectacles by a person legally qualified to perform those services; or
(ii) the supply of spectacles in accordance with any such prescription; or
(h) as remuneration of a person for services rendered by him or her as an attendant of a person who is blind or permanently confined to a bed or an invalid chair; or
(i) for the maintenance of a dog used for the guidance or assistance of, but not social therapy for, a person with a disability, being a dog that the Commissioner is satisfied is properly trained in the guidance or assistance of persons with disabilities.
The cost of travel does not fall within any of the categories of medical expenses as defined, as the eligible payments are restricted to the cost of the actual treatment provided.
Furthermore, as held by the Administrative Appeals Tribunal in Case R12 84 ATC 165; (1984) 27 CTBR (NS) Case 63, travelling expenses, while necessary to receive treatment, were not in respect of that treatment.
Accordingly, the travel expenses you have paid in order to obtain medical treatment are not a medical expense as defined in subsection 159P(4) of the ITAA 1936 and they cannot be included when calculating the medical expense tax offset.
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