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

Ruling: Q1: Do the following expenses qualify as eligible medical expenses for the purposes of the medical expenses tax offset? · wooden wedge for wheel chair access to house · hand held shower installation · non slip coating on tiles in the bathroom | A1: No. | Q2: Do the following expenses qualify as eligible medical expenses for the purposes of the medical expenses tax offset? · perching stall · shower chair · toilet chair · modular grab rail system | A2: Yes.

Relevant facts and circumstances: Your spouse suffers from a medical condition. An occupational therapist visited your home and provided an assessment of items your spouse would require to support him/her living at home. You have purchased and installed the following items: · perching stall with arm · shower chair · toilet chairs · non slip coating on tiles in the bathroom · modular grab rail system · wooden wedge (to allow wheelchair access to the front of the home) · hand held shower installation

Relevant legislative provisions: Income Tax Assessment Act 1936 section 159P, and | Income Tax Assessment Act 1936 section 159P(4).

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 whose net medical expenses exceed $2,060 in the 2011-12 financial year. Before the medical expenses tax offset amount is worked out, the total medical expenses paid in the year of income must be reduced by any entitlement to reimbursement from a health fund or government authority. The tax offset amount is 20 per cent of the net medical expenses paid in the income year in excess of $2,060. Paragraph 159P(4)(f) of the ITAA 1936 defines medical expenses to include 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. | Detailed Reasoning - Question 1:: You have incurred expenses for a wheelchair ramp, hand held shower and non slip floor coating in your bathroom. Although the hand held shower and non slip floor coating are required due to your spouse's medical condition, they have a general domestic or household purpose. These items are not payments for an instrument, apparatus or device recognised as an aid to the function or capacity of a disabled person. As per paragraph 9 of TR 93/34, wheelchair ramps are not considered to be a medical or surgical appliance. Accordingly, the costs you incurred in relation to these expenses are not eligible medical expenses. | Detailed Reasoning - Question 2:: You have incurred expenses for a perching stall, shower chair, toilet chair and modular grab rail system. These items are all manufactured and generally recognised to be an aid to the function or capacity of a person with a disability or illness. Therefore, they are considered medical or surgical appliances for the purposes of the definition of medical expenses in subsection 159P(4) of the ITAA 1936. According, the costs you incurred in relation to these items are eligible medical expenses.

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