Private ruling: net medical expenses tax offset
Date of advice: 11 September 2017
Published: January 2018
Ruling period: Year ending 30 June 20XX | This scheme commenced on: | 1 July 20XX

Ruling: Questions and answers: | 1. Are you entitled to claim your total out-of-pocket medical expenses incurred in the 2017-18 year under the Net Medical Expenses Tax Offset (NMETO)? | No. | 2. Are your dentures a disability aid in respect to the requirements of the NMETO? | No.

Relevant facts and circumstances: You have had false teeth fitted. The work was performed by a legally qualified dentist. You had out-of-pocket medical expenses relating to your dental expenses. You did not claim the NMETO in the 2013-14 and 2014-15 income years.


Reasons for decision: Summary: Summary You will not be able to claim NMETO for the 2017-18 income period as you do not meet the requirements of section 159P of the Income Tax Assessment Act 1997 (ITAA 1997). Reasoning Section 159P of the ITAA 1997 provides the conditions for claiming the NMETO. As of 1 July 2015 you are only able to claim the NMETO if you have claimed the offset in the 2013-14 and 2014-15 income periods. The exception to this is if the expense relates to an aid for a person with a disability, relates to a service rendered by a person as an attendant of a person with a disability or relates to care provided by an approved provider under the Aged Care Act 1997 . You did not claim the NMETO in the 2013-14 and 2014-15 income periods and thus you do not meet that condition. However, there are still the other three criteria which you can meet. You will not meet the requirement of a service rendered by a person as an attendant of a person with a disability and your expenses are not related to care provided by an approved provider. This means that the expenditure for your dentures would have to meet the definition of a disability aid. The schedule 3 of the explanatory memorandum for the Tax and Superannuation Laws Amendment (2014 Measures No. 1) Act 2014 provides some overview as to what a disability aid is. The act states: Whether an expense is related to disability aids, attendant care or aged care will largely be a matter of fact and circumstance. During the phase-out period, additional guidance will be provided by the Australian Taxation Office to assist people with determining whether their expense is eligible to be claimed under the NMETO. The concept of a disability aid , for the purpose of these amendments, is intended to mean an instrument, apparatus, assistance device or any other item of property that is manufactured as, distributed as, or generally recognised to be, an aid to the function or capacity of a person with a disability. This provides examples of aids such as wheel chairs or maintenance of guide dogs and as such dentures do not meet this definition. Furthermore, example 3.6 states: When completing his tax return for the 2014-15 income year Ross determines that he is unable to claim the NMETO for that year because he did not receive an amount of the NMETO in the 2013-14 income year (as his expenses were under the relevant thresholds for that year) and because his medical expenses for the 2014-15 income year were for major dental work and not related to disability aids , attendant care or aged care. You had false teeth fitted. However, for the purposes of the NMETO your false teeth will not be a disability aid. Therefore your out-of-pocket dental expenses are not eligible medical expenses for the purposes of the NMETO and you are not entitled to make a claim.

Relevant legislative provision: Income Tax Assessment Act 1936 section 159P