Private ruling: medical expenses
Ruling period: Year ended 30 June 2009 | Year ended 30 June 2010 | Year ending 30 June 2011 | Year ending 30 June 2012 | Year ending 30 June 2013 | Year ending 30 June 2014
Date scheme commenced: 1 July 2008

Ruling: Q1: Does the cost of your child's particular therapy qualify as a medical expense for the purposes of the medical expenses tax offset? | A1: Yes. | Q2: Does the cost of hiring a machine to assist with your child's particular therapy qualify as medical expenses for the purposes of the medical expenses tax offset? | A2: Yes.


Relevant legislative provisions: Income Tax Assessment Act 1936 Subsection 159P(3A). | Income Tax Assessment Act 1936 Subsection 159P(4).

Reasons for decision: Summary: Subsection 159P(3A) of the Income Tax Assessment Act 1936 (ITAA 1936) provides that a tax offset is allowable to a taxpayer whose net medical expenses in the year of income exceed $1,500. The claim threshold has increased from $1,500 to $2,000 with effect from 1 July 2010. Subsection 159P(4) of the ITAA 1936 defines which medical expenses are allowable in the calculation of the offset. Paragraph (d) includes payments for therapeutic treatment administered by direction of a legally qualified medical practitioner It was held in Case A53 69 ATC 313; 15 CTBR (NS) Case 30 that the mere suggestion or recommendation by a medical practitioner that the patient undergoes therapeutic treatment is not sufficient for the payment to qualify as medical expenses. The patient would have to be referred by a medical practitioner to a particular person for specific treatment. Therapeutic treatment as a concept is concerned with healing or curing, rather than preventing the need for therapy (18 TBRD Case T67 ; 14 CTBR (NS) Case 31 ). Although the treatment must be administered by direction of a legally qualified medical practitioner, the treatment need not be administered by such a practitioner. In addition, the Administrative Appeals Tribunal found in Case R95 84 ATC 633; Case 148 27 CTBR (NS) 1154 that therapeutic treatment necessitated the exercise of professional skill in the medical field. This would normally involve the person administering the treatment using chemical agents or drugs or some physical and mental processes which are directed towards the cure or management of a disease or ailment. In your case you were referred by your legally qualified medical practitioner for your child to undergo treatment. The costs incurred for this specific therapeutic treatment qualifies as a medical expense under subsection 159P(4) of the ITAA 1936 and can be included when calculating the medical expenses tax offset.

Please check this edited version to be sure that there are no details remaining that you think may allow you to be identified. Contact us at the address given in the fact sheet if you have any concerns. | Relevant facts: Your child was diagnosed with a medical condition from birth. | The treatment for your child's illness was commenced as soon as your child was released from hospital. | Your child underwent therapy at the hospital's early intervention program. | Your family doctor recommended and prescribed a treatment for your child. | This treatment needs to be done on a daily basis and during the night the child is on a machine. | You have incurred expenses in relation to this treatment.