Private ruling: medical expenses tax offset
Published: January 2012
Ruling period: Year ended 30 June 2011
Date scheme commenced: 01 July 2010

Ruling: Q1: Are you able to claim a tax offset for the cost of bathroom modifications and an access ramp? | A1: No.

Relevant facts and circumstances: You suffered an injury which resulted in surgery in 2011. Following the surgery your mobility has become restricted and to enable you to continue to live at home you required modifications to your bathroom and shower facilities. The modifications to your bathroom were extensive and were carried out by a construction company. Additionally you also arranged for the construction of a ramp at your back door.

Relevant legislative provisions: Income Tax Assessment Act 1936 section 159P.

Reasons for decision: Summary: A medical expenses tax offset is available to a taxpayer under subsection 159P(1) of the Income Tax Assessment Act 1936 (ITAA 1936) where the taxpayer pays medical expenses in an income year for themselves or a dependant who is an Australian resident, to the extent that they are not reimbursed, or are eligible to be reimbursed, from a government or public authority or a society, association or fund. Subsection 159P(4) of the ITAA 1936 defines medical expenses which are eligible for the medical expenses tax offset. Paragraph (f) of the definition of medical expenses in subsection 159P(4) of the ITAA 1936 includes payments made in respect of a medical or surgical appliance prescribed by a legally qualified medical practitioner. Taxation Ruling TR 93/34 explains the meaning of a 'medical or surgical appliance' as being an instrument, apparatus or device which is manufactured, distributed or generally recognised as an aid to the function or capacity of a person with a disability or an illness. This definition looks to the character of the appliance, not the purpose for which it is prescribed or used. It is not sufficient that a medical practitioner prescribes an appliance for medical or surgical ends. You have incurred expenses for bathroom modifications and for an access ramp to assist with your ability to access and use your bathroom and to improve your ease of mobility to the rear entrance to your house. Although these bathroom modifications and access ramp are required due to your medical condition, they have a general domestic or household purpose. Building alteration expenses are not payments for an instrument, apparatus or device recognised as an aid to the function or capacity of a disabled person. Therefore, the modifications to your bathroom and the access ramp are not considered medical or surgical appliances for the purposes of paragraph (f) of the definition of medical expenses in subsection 159P(4) of the ITAA 1936. Accordingly the costs you incurred in relation to the bathroom modifications and access ramp are not eligible medical expenses.

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