Edited version of private ruling

Authorisation Number: 1011588259826

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Ruling

Subject: Medical expenses tax offset

1. Are the costs of food, vet expenses and grooming expenses for an assistance dog medical expenses for the purposes of claiming the medical expenses tax offset?

Yes.

2. Are the costs of training, behavioural rehabilitation and pet insurance for an assistance dog, and your transport and accommodation expenses for collecting or taking a dog to training medical expenses for the purposes of claiming the medical expenses tax offset?

No.

Relevant facts

You have two trained and accredited assistance dogs which mitigate the effects of your medical condition. The first of your assistance dogs, dog A, you have had since 2007. Your doctor verified in writing in September 2007 that it is their professional opinion that dog A assists you to manage your medical condition.

The new training accreditation provider you use provided a second assistance dog, dog B, following a situation where dog A cannot assist you to the same degree when out of the house. Dog A continues to be of great assistance to you inside the house.

Each dog has to pass accreditation checks annually, and the assistance dog provider has stated that in your case there is a real benefit in you retaining both dogs, as each provides unique assistance to you in different situations. The assistance dog provider continues to assess both dogs for accreditation purposes.

Reasons for decision

Medical expenses tax offset

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 incurs 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 the 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 the threshold for the income year. The threshold for the 2009-10 income year is $1,500. Thresholds for the 2011 and 2012 years have not yet been determined.

Medical expenses are defined in subsection 159P(4) of the ITAA 1936 to include payments for the maintenance of a properly trained dog used for the guidance or assistance of a person with a disability (but not for social therapy).

The costs of maintaining an assistance dog are a medical expense for the purposes of claiming the medical expenses tax offset.

Costs of food, vet expenses and grooming expenses are expenses incurred in respect of maintaining an assistance dog, and therefore they qualify for inclusion in the calculation of the medical expenses tax offset.

Costs of training, behavioural rehabilitation, pet insurance, and your transport and accommodation when collecting a dog or taking a dog to training would not be eligible for the medical expenses tax offset as they are not considered to be expenses of maintaining a dog. As such these expenses cannot be included in a claim for a medical expenses tax offset

It is considered that the costs of vet insurance are incurred in order to protect against loss or injury of the assistance dog rather than maintaining the dog.