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Edited version of private ruling
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Ruling
Subject: Medical expenses tax offset
Question 1
Can you include the amount you paid for using a wheelchair taxi to attend exercise classes when calculating the medical expenses tax offset?
Answer: No.
Question 2
Can you include the amount you paid for the cost of a home carer to put you to bed and shower when calculating the medical expenses tax offset?
Answer: Yes.
Question 3
Can you include the amount you paid for your wheelchair when calculating the medical expenses tax offset?
Answer: Yes.
Question 4
Can you include the amount you paid for a podiatrist when calculating the medical expenses tax offset?
Answer: No.
This ruling applies for the following period
Year ended 30 June 2009
The scheme commenced on
1 July 2008
Relevant facts and circumstances
You suffer from an illness.
You are permanently confined to a wheelchair.
You use a wheelchair taxi to attend exercise classes required by your physiotherapist.
You sought home care to assist in putting you to bed and to shower.
You receive home care from an Australian government agency.
Home care was approved as a result of a referral from your doctor.
Home care is provided as a long term service to you.
Home care attendants are properly trained staff but they are not nurses.
You paid a total of $X for the 2008-09 income year to home care for services rendered to you.
You use the services of a podiatrist.
You have not incurred any expenses from the podiatrists as yet as Medicare covers this service.
Relevant legislative provisions
Income Tax Assessment Act 1936 section 159P
Reasons for decision
A medical expenses tax offset is available to a taxpayer under subsection 159(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 income year.
Wheelchair taxi expenses
The definition of medical expenses does not include the costs of food, travel or accommodation to obtain medical treatment. This was confirmed by the decision of the Administrative Appeals Tribunal in Case R12 84 ATC 165;27 CTBR (NS) Case 63. In that case, travelling expenses whilst necessary in order to receive medical treatment were held not to be a payment for the medical treatment.
Accordingly, the wheelchair taxi expenses that you paid to travel to exercise classes are not medical expenses as defined in subsection 159P(4) of the ITAA 1936.
Therefore you are not entitled to include the cost of the wheelchair taxi in your claim for a medical expenses tax offset.
Home care expenses
Medical expenses are defined in subsection 159P(4) of the ITAA 1936 to include payments made to a person providing services, as an attendant, of a person who is blind or permanently confined to a bed or an invalid chair (paragraph (h) of the definition).
In your case, the un-reimbursed costs you have incurred in relation to the personal services provided by home care services, such as putting you to bed and showering you meet the definition of medical expenses. Therefore these expenses can be included when calculating the medical expenses tax offset.
Please note, where any portion of your payments relate to administrative costs, this portion is not regarded as a medical expense. Only the payments for providing services as an attendant qualify as a medical expense.
Wheelchair expenses
Medical expenses are defined in subsection 159P(4) of the ITAA 1936 to include payments made in respect of a medical or surgical appliance prescribed by a legally qualified medical practitioner (paragraph (f) of the definition).
Taxation Ruling TR 93/34 explains the meaning of a 'medical or surgical appliance' as an instrument, apparatus or device which is manufactured as, distributed as, or generally recognised to be an aid to the function or capacity of a person with a disability or illness.
Paragraph 8 of TR 93/34 includes wheelchairs as an example of a 'medical or surgical appliance'.
Therefore, the cost of your wheelchair will qualify as an eligible medical expense where it has been prescribed by a legally qualified medical practitioner.
Podiatry expenses
Medical expenses are defined in subsection 159P(4) of the ITAA 1936 to include payments for therapeutic treatment administered by direction of a legally qualified medical practitioner (paragraph (d) of the definition).
Podiatry is categorised as therapeutic treatment and must be administered by the direction of a legally qualified medical practitioner.
In your case, you do not have any net medical expenses in relation to the services provided by your podiatrist. Therefore no medical expenses tax offset applies.