Private ruling: Medical expenses tax offset - therapeutic treatment
Published: October 2012
Ruling period: Year ended 30 June 2012
Date scheme commenced: 1 July 2011

Ruling: Q1: Is therapeutic treatment which is not at the direction of a legally qualified medical practitioner considered a medical expense as defined in subsection 159P(4) of the Income Tax Assessment Act 1936 (ITAA 1936)? | A1: No

Relevant facts and circumstances: During the 2011-12 financial year you received therapeutic treatment. You did not obtain a referral from a registered medical practitioner to undertake this therapeutic treatment.

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

Reasons for decision: Summary: Section 159P of the ITAA 1936 provides for a tax offset to a taxpayer whose net medical expenses in the year of income exceed the threshold dollar amount specified in the section. The amount of the tax offset is equal to 20% of the expenditure that exceeds the threshold amount. Subsection 159P(4) of the ITAA 1936 defines 'medical expenses'. Paragraph (d) of the definition of medical expenses includes a payment, 'for therapeutic treatment administered by direction of a legally qualified medical practitioner '. It was held in Case A53 69 ATC 313; (1969) 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. In the context of paragraph (d) of the definition, therapeutic treatment involves the exercise of professional skill in the medical field in a way which normally involves the person administering the treatment using drugs or physical or mental processes of one kind or another for the purpose of curing or managing disease ( Case R95 84 ATC 633; (1984) 27 CTBR (NS) Case 148 ). As your therapeutic treatment was not directly referred by a medical practitioner to a particular person for specific treatment, it is not considered a medical expense eligible for the medical expenses tax offset.

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