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Ruling
Subject: Medical expenses tax offset - home care
Question
Do your payments for personal care services rendered qualify as medical expenses for the purpose of claiming the medical expenses tax offset?
Answer
No.
This ruling applies for the following periods
Year ended 30 June 2013
Year ended 30 June 2014
Year ended 30 June 2015
Year ended 30 June 2016
The scheme commenced on
1 July 2012
Relevant facts and circumstances
You are aged and suffer from a medical condition.
You are under medication, and were receiving care in your home from a one carer.
You are not blind or permanently confined to an invalid bed or wheelchair.
Your doctor has recommended that you receive full time care at home as soon as possible, because of your medical condition.
The additional care has been secured at an additional cost.
Your carers have aged care qualifications, but not to the level of a registered nurse or other healthcare professional.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 159P and
Income Tax Assessment Act 1997 Subsection 159P(4).
Reasons for decision
Pursuant to section 159P of the Income Tax Assessment Act 1936 (ITAA 1936) a tax offset is available to a taxpayer whose net medical expenses in a year of income exceed the medical expenses tax offset threshold. The amount of the offset is 20% of the excess over the threshold amount. To qualify for the tax offset, the medical expenses must be paid by a resident taxpayer in respect of themselves or a resident dependant.
For the payments for home care to qualify as medical expenses for the purposes of the medical expenses tax offset, the expense must fall within the definition of 'medical expenses' as contained in subsection 159P(4) of the ITAA 1936.
Paragraph (a) of the definitions of medical expenses in subsection 159P(4) of the ITAA 1936 includes, payments to a legally qualified medical practitioner, nurse or chemist, or a public or private hospital, in respect of an illness or operation.
Paragraph (h) of the definitions of medical expenses in subsection 159P(4) of the ITAA 1936 includes payments as remuneration of a person for services rendered by them as an attendant of a person who is blind or permanently confined to a bed or an invalid chair.
The need to employ a person to provide assistance to enable you to live at home is necessitated by your illness and aged care needs.
In your circumstances, the payments were not made to a legally qualified medical practitioner, nurse or chemist, or a public or private hospital. Furthermore, you are neither blind nor permanently confined to a bed or an invalid chair.
Therefore, payments for your home care do not qualify as medical expenses for the purposes of the medical expenses tax offset.