Edited version of your private ruling

Authorisation Number: 1012300107940

This edited version of your ruling will be published in the public register of private binding rulings after 28 days from the issue date of the ruling. The attached private rulings fact sheet has more information.

Please check this edited version to be sure that there are no details remaining that you think may allow you to be identified. If you have any concerns about this ruling you wish to discuss, you will find our contact details in the fact sheet.

Ruling

Subject: Medical expenses tax offset

Question 1:

Are you entitled to include the cost of special food when calculating your medical expenses tax offset?

Answer:

No.

Question 2:

Are you entitled to include the cost of vitamin supplements when calculating your medical expenses tax offset?

Answer:

Yes.

This ruling applies for the following periods:

Year ending 30 June 2013

Year ending 30 June 2014

Year ending 30 June 2015

Year ending 30 June 2016

The scheme commenced on:

1 July 2012

Relevant facts and circumstances

You have a medical condition and are on a lifelong special diet.

Your doctor referred you to a dietician for management of your medical condition.

Your dietician advises and prescribes you the dietary supplements that you require.

Your dietician prescribes you dietary supplements; including vitamins to keep your essential mineral and vitamin levels in check as your condition prevents you from absorbing these naturally.

Your doctor monitors your therapeutic treatment provided by the dietician. You have blood tests taken and analyses provided by your doctor in regards to your levels of essential vitamins and minerals within your system.

You purchase special foods that you require from the supermarket.

You purchase your vitamin supplements from your dietician.

Relevant legislative provisions:

Income Tax Assessment Act 1936 Section 159P

Reasons for decision

A medical expense tax offset is available to a taxpayer under section 159P 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. The medical expenses tax offset is 20% of the amount by which the net medical expenses exceeds $1,500 for that income year.

Medical expenses are defined in subsection 159P(4) of the ITAA 1936 to include:

· payments to a legally qualified medical practitioner, nurse or chemist, or a

· public or private hospital, in respect of an illness or operation

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

· payments in respect of a medical or surgical appliance prescribed by a legally qualified medical practitioner.

Therapeutic treatment

For treatment to be regarded as being administered by direction of a legally qualified medical practitioner, the treatment needs to be advised, prescribed or ordered by a legally qualified medical practitioner. It also requires monitoring to some extent by the medical practitioner. 

A second requirement is that the treatment is therapeutic. Therapeutic treatment is concerned with healing or curing, rather than preventing the need for therapy.

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.

In your case it is considered that the treatment being used to manage your medical condition is a therapeutic treatment as you were referred by your doctor to a dietician for therapeutic treatment. The intention of the treatment you receive from your dietician is to manage your condition.

Special food products purchased from non-specialist retail outlets and health food stores

Where special foods are purchased from a supermarket or specialist health food stores, they are not considered eligible medical expenses. They are not purchased from a chemist and cannot be considered therapeutic treatment. 

The longstanding view affirmed in Taxation Ruling IT 2146 is that the cost of foods for special dietary purposes does not qualify as therapeutic treatment. This is affirmed by case law involving a taxpayer who suffered allergic reactions to gluten and purchased special gluten-free products from a health food store. The Boards of Review found that the cost of foods for special dietary purposes did not qualify as therapeutic treatment and rejected the claim.

You can not include the cost of purchasing gluten free products as a medical expense under section 159P of the ITAA 1936.

Vitamin supplements

The dietary vitamin supplements that you take are prescribed and supplied by your dietician.

The vitamin supplements you purchase are considered to be part of your therapeutic treatment as your medical practitioner has specifically advised you see a dietician to monitor your nutrition and to provide the treatment to manage your medical condition. 

You are prescribed vitamin supplements as part of your therapeutic treatment; therefore expenses that you incur for the vitamin supplements that are prescribed and supplied to you by your dietician may be included as a medical expense under section 159P of the ITAA 1936.