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Edited version of your written advice
Authorisation Number: 1012991983318
Date of advice: 4 April 2016
Ruling
Subject: Medical expenses
Question
Are you entitled to a medical expenses tax offset in relation to the payments made by the Trust?
Answer
No.
This ruling applies for the following periods
Year ended 30 June 2014
Year ended 30 June 2015
Year ended 30 June 2016
Year ended 30 June 2017
Year ended 30 June 2018
Year ended 30 June 2019
The scheme commences on:
1 July 20XX
Relevant facts
You are an Australian resident for income tax purposes.
Wages and superannuation are paid to person A. The wages and compulsory superannuation guarantee contributions are paid by a Trust. You are a trustee of, the Trust however you are not a beneficiary of the Trust.
The payment of wages and superannuation is treated as a loan from the Trust to you. You are not required to repay the loan, however it may come out of your estate. You are not reimbursed by any entity for the amounts.
Person A is not a legally qualified medical practitioner or nurse and nor were they referred to you by one.
Person A is employed as a personal assistant for you. You are unable to live independently without assistance owing to restrictions and impairments. You use a walking stick are restricted in physical activities and in doing physical work.
You are not confined to a bed or invalid chair and are not blind.
You did not receive a medical expenses tax offset in the 2012-13 or 2013-14 financial years.
Relevant legislative provisions
Income Tax Assessment Act 1997 Section 159P
Reasons for decision
A medical expenses tax offset is available under subsection 159P(1) of the Income Tax Assessment Act 1936 (ITAA 1936) where you pay certain medical expenses in an income year for yourself or a dependant who is an Australian resident, to the extent that you are not reimbursed, or are eligible to be reimbursed, from a government or public authority or a society, association or fund.
Under section 159P(3) of the ITAA 1936, medical expenses paid by a trustee out of trust income on behalf of a resident beneficiary may be eligible for the medical expenses tax offset.
In your case the expenses in relation to your attendant are not paid by you. The Trust is paying the expenses on your behalf, however as you are not a beneficiary of the Trust section 159P(3) of the ITAA 1997 does not apply.
Therefore as you have not paid for the expenses you are not entitled to a medical expenses tax offset.