Private ruling: Medical expenses tax offset
Published: August 2013
Ruling period: Year ended 30 June 2012 | Year ended 30 June 2013
Date scheme commenced: 1 July 2011

Ruling: Q1: Are you entitled to a medical expenses tax offset for a cosmetic procedure? | A1: No.

Relevant facts and circumstances: You underwent a cosmetic procedure at a plastic surgery clinic. The procedure and cost was not claimed at all through Medicare or your private health fund. The procedure was undertaken as you felt it may help your self confidence.

Relevant legislative provisions: Income Tax Assessment Act 1936 Section 159P

Reasons for decision: Summary: Under section 159P of the Income Tax Assessment Act 1936 (ITAA 1936) a tax offset is available to a resident taxpayer for certain net medical expenses. Subsection 159P(4) of the ITAA 1936 defines 'ineligible medical expenses' as payments: (a) to a legally qualified practitioner, nurse or chemist, or a public or private hospital, in respect of a cosmetic operation that is not a professional service for which a Medicare benefit is payable under Part II of the Health Insurance Act 1973 ;. Your operation was performed by a legally qualified medical practitioner at a private hospital. In determining whether an operation is cosmetic in nature, the ordinary definition of 'cosmetic' applies. The Macquarie Dictionary 4 th ed (2005) defines 'cosmetic' as, relevantly: 2. serving to beautify; imparting or improving beauty, especially of the complexion. 3. designed to effect a superficial alteration while keeping the basis unchanged… 4. intended for show; superficial." Therefore, a cosmetic operation is one which beautifies or changes a person's appearance. The surgery was undertaken in order to boost your self-confidence. Your operation is considered to be cosmetic in nature. Additionally, you have not received any Medicare benefit or claim through your private health fund in respect of your surgery. Your expenses are ineligible medical expenses because they were for a cosmetic operation which did not attract a Medicare payment. Therefore, you are unable to include these expenses when calculating your eligibility to a medical expenses tax offset.