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Ruling
Subject: Medical expenses tax offset
Question
Are you entitled to include the cost of additional electricity to run the air conditioner in a calculation for a medical expenses tax offset?
Answer
No.
This ruling applies for the following period
Year ended 30 June 2012
The scheme commenced on
1 July 2011
Relevant facts
You have a number of medical conditions which require the extensive use of an air conditioner all year.
Relevant legislative provisions
Income Tax Assessment Act 1936 Section 159P
Income Tax Assessment Act 1936 Subsection 159P(4)
Reasons for decision
Under section 159P of the Income Tax Assessment Act 1936 (ITAA1936) a tax offset is available to a resident taxpayer whose net medical expenses paid in the year of income exceed the relevant threshold.
Net medical expenses are the medical expenses a taxpayer has paid less any refunds they received, or could have received, from Medicare or a private health fund.
A taxpayer may claim a tax offset of 20% of the net medical expenses paid in the year of income in excess the relevant threshold.
The term 'medical expenses' is defined in subsection 159P(4) of the ITAA 1936, and includes such payments made:
· to a legally qualified medical practitioner, nurse or chemist, or a public or private hospital, in respect of an illness or operation
· in respect of a medical or surgical appliance prescribed by a legally qualified medical practitioner.
In your case, we accept that the extensive use of the air conditioner is necessary in assisting with your condition. However, it is not considered to be a medical or surgical appliance. Therefore the cost of running the air conditioner is can not be included in a calculation for the purposes of the medical expenses tax offset.