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Ruling
Subject: Medical Tax Offset- School fees
Question
Does the cost of school fees qualify as a medical expense for the purpose of calculating your entitlement to a medical expenses tax offset?
Answer: No.
This ruling applies for the following period
Year ended 30 June 2010
The scheme commenced on
1 July 2009
Relevant facts
Your child has been diagnosed with autism.
Your child is in the first year at a special education private school.
The state department of Education and Training has been unable and is unable in the near future to provide a placement in a suitable public school setting in your region.
You are faced with no option of your child attending a public school in your region and are forced to enrol your child in a small "special-education" private school that would cater for your child's needs.
While your child's educational and management requirements are being met, you are experiencing financial hardship in meeting the school fees.
Relevant legislative provisions
Income Tax Assessment Act 1936 Section 159P.
Income Tax Assessment Act 1936 Subsection 159P(4).
Reasons for decision
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 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.
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.
Therapeutic treatment as a concept is concerned with healing or curing, rather than preventing the need for therapy (Case T67 (1968) 18 TRBD 346; (1967) 14 CTBR (NS) Case 31). 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 the disease or ailment (Case R95 84 ATC 633; (1984) 27 CTBR (NS) Case 148).
In your case, while we acknowledge the heavy burden placed on you by not having public education facilities available, the cost of school fees does not involve any healing or curing, nor is it treatment administered by a person exercising skill in the medical field. The special school is for educational purposes and is not considered to be therapeutic treatment.
Therefore, the expenses you incurred for your child's school fees do not qualify as medical expense for the purposes of the medical expenses tax offset under section 159P of the ITAA 1936.