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Ruling

Subject: Medical expenses tax offset

Question 1:

Does the cost of attending physiotherapy sessions qualify as a medical expense for the purposes of the medical expenses tax offset?

Answer: Yes.

Question 2:

Does the cost of attending chiropractor sessions qualify as a medical expense for the purposes of the medical expenses tax offset?

Answer: No.

This ruling applies for the following period:

Year ended 30 June 2011

The scheme commenced on

1 July 2010

Relevant facts

You suffered an injury a number of years ago.

Your doctor has referred you to a physiotherapist to have treatment to manage the condition.

Your physiotherapist provided a report back to your doctor in relation to your treatment. 

Your doctor oversees your treatment.

Your doctor did not refer you to a chiropractor for treatment.

You attended a number of chiropractor sessions for treatments during the financial year when you could not get an appointment with the physiotherapist.

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 section 159P of the Income Tax Assessment Act 1936 (ITAA 1936), where the taxpayer pays medical expenses for themselves or a dependant who is an Australian resident.

The medical expenses tax offset is only available if the amount of medical expenses (reduced by any entitlement to reimbursement from a health fund or government authority) exceeds $2,000 in the income year. The tax offset is 20% of the amount by which the net medical expenses exceeds the relevant amount mentioned for each income year.

Subsection 159P(4) of the ITAA 1936 defines which medical expenses are allowable in the calculation of the offset. Relevant to your situation are payments:

· for therapeutic treatment administered by direction of a legally qualified medical practitioner

The term 'therapeutic treatment' contemplates that the treatment administered by the medical practitioner is directed towards the cure of the ill patient or management of the patient's illness. A mere suggestion or recommendation by a doctor to a patient that the patient undergo therapeutic treatment is not enough for the associated expenses to qualify as medical expenses. The patient must be referred to a particular person for the administered therapeutic treatment (Case A53 69 ATC 313).

In your case, a doctor referred you to a physiotherapist to undertake physiotherapy sessions to treat your medical condition. The physiotherapist provided a written report to your doctor regarding your progress. Your doctor monitored your treatment.

Because you have been referred to a particular physiotherapist by a qualified medical practitioner, and because the treatment under the direction of the physiotherapist is a continuation of the treatment conducted by your doctor, we consider that the expenses in relation to visiting the physiotherapist are medical expenses which can be used to calculate your eligibility to a medical expenses tax offset.

However, you were not referred to a particular chiropractor by your doctor to have treatment for your medical condition. The expenses in relation to visiting the chiropractor are not medical expenses for medical expenses tax offset purposes.