19 September 2001 External T.I. 2001-0093005 - MEDICAL EXPENSE

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.

Principal Issues: Whether amounts paid to attend XXXXXXXXXX to control obesity, qualifies as medical expense, tuition credit, and/or education credit.

Position: - no for education and tuition credit
- possible in extraordinary cases, if provisions of Act are met, to be
considered a medical expense

Reasons: ITA 118.5, ITA 118.6(1) (def. of "qualifying educational program" and "designated educational institution"), and ITA 118.2(2)(e),

XXXXXXXXXX 				2001-009300
					Shaun Harkin, CMA
September 19, 2001

Dear XXXXXXXXXX:

Re: Technical Interpretation Request: Medical or Education Tax Credit

This is in reply to your letter of July 12, 2001 wherein you enquired as to whether the amount paid to XXXXXXXXXX qualifies as a medical expense or for the education/tuition credit for the purposes of the Income Tax Act (the "Act").

You state that you have been diagnosed as being morbidly obese, suffering from high blood pressure, and having several types of arthritis. You attended XXXXXXXXXX at a cost of $XXXXXXXXXX Canadian. In addition to accommodation and meals, you had physical examinations done by Nurses and Medical Doctors and were provided services pertaining to nutrition, psychology and exercise in an effort to lose weight. Dieticians, Psychologists, Social Workers and Registered Personnel Trainers provided these services. You are a Canadian resident.

Written confirmation of the consequences inherent in particular transactions are given by this directorate only where the transactions are proposed and are the subject matter of an advance ruling request submitted in the manner set out in Information Circular 70-6R4. If, however, the particular transactions are partially completed or completed, the enquiry should be addressed to the relevant Tax Services Office. Notwithstanding the foregoing, we are providing the following comments.

Paragraph 118.2(2)(e) of the Act describes a medical expense to include an amount paid:

"for the care, or the care and training, at a school, institution or other place of the patient, who has been certified by an appropriately qualified person to be a person who, by reason of a physical or mental handicap, requires the equipment, facilities or personnel specially provided by that school, institution or other place for the care, or the care and training, of individuals suffering from the handicap suffered by the patient;"

Thus, in order for the fees paid to XXXXXXXXXX to qualify, as medical expenses for a particular individual three basic requirements must be met:

1. An appropriately qualified person must certify the individual. This certification is usually done by a medical practitioner or psychologist but is not restricted to such professionals.

2. The individual must be suffering from a physical or mental handicap.

3. The individual requires the equipment, facilities or personnel specially provided by the institution to treat the individual's particular physical or mental handicap and the determination of the individual's requirements must be made by the qualified person making the certification

You do not state in your letter whether an appropriately qualified person has certified your medical condition to be a physical or mental handicap. You also do not state if a qualified person has certified that you require the equipment, facilities or personnel specially provided by XXXXXXXXXX.

An "appropriately qualified person" includes a medical practitioner as well as any other person who has been given the required certification powers under a provincial or federal law.

In general, payments to a school, institution or other place for the care, or care and training of an individual will qualify as a medical expense if an appropriately qualified person has certified that the patient requires the care or training of that institution because of a physical or mental handicap. However, fees paid for a weight-loss program or course are not considered to qualify as medical expenses under paragraph 118.2(2)(e) of the Act unless, in an exceptional case, such a program or course is part of a patient's medical treatment that is required because of a serious health deterioration problem and that is both prescribed and monitored by a medical practitioner.

In summary, given the information you have provided, we are not in a position to provide you with a definitive answer as to whether amounts paid to XXXXXXXXXX qualify as a medical expense for the purpose of paragraph 118.2(2)(e) of the Act.

The tuition credit is described in subsection 118.5(1) of the Act. In order for you to be eligible for the tuition credit, the requirements of paragraph 118.5(1)(b) of the Act must be met. This paragraph states in part:

"(b) ..... the individual was during the year a student in full-time attendance at a university outside Canada in a course leading to a degree..."

Since XXXXXXXXXX is not a university, the amounts paid to XXXXXXXXXX do not quality for the tuition credit.

In order to be eligible for the education credit, described in subsection 118.6(2) of the Act, the program must be in respect of a program at a "designated educational institution". Subsection 118.6(1) of the Act defines an "designated educational institution" to be:

"(a) an educational institution in Canada that is

(i) a university, college or other educational institution designated by the Lieutenant Governor in Council of a province as a specified educational institution under the Canada Student Loans Act, designated by an appropriate authority under the Canada Student Financial Assistance Act, or designated by the Minister of Higher Education and Science of the Province of Quebec for the purposes of An Act respecting financial assistance for students of the Province of Quebec, or

(ii) certified by the Minister of Human Resources Development to be an educational institution providing courses, other than courses designed for university credit, that furnish a person with skills for, or improve a person's skills in, an occupation,

(b) a university outside Canada at which the individual ...... was enrolled in a course, of not less than 13 consecutive weeks duration, leading to a degree, or

(c) if the individual ...... resided, throughout the year referred to in that subsection, in Canada near the boundary between Canada and the United States, an educational institution in the United States to which the individual commuted that is a university, college or other educational institution providing courses at a post-secondary school level;"

XXXXXXXXXX does not meet the definition of a "designated educational institution" and, therefore, attendance at XXXXXXXXXX would not qualify for the education credit.

For your information, we have enclosed a copy of Interpretation Bulletin IT-519R2 (Consolidated), Medical Expenses and Disability Tax Credits and Attendant Care Expense Deduction, and we have highlighted some of the sections that may be of particular interest to you.

The foregoing comments represent our general views with respect to the subject matter. As indicated in paragraph 22 of Information Circular 70-6R4, the above comments do not constitute an income tax ruling and accordingly are not binding on the Canada Customs and Revenue Agency. Our practice is to make this disclaimer in all instances in which we provide an opinion.

We trust the above comments are of assistance.

Yours truly,

Steve Tevlin
for Director
Partnerships Section
Business and Partnerships Division
Income Tax Rulings Directorate
Policy and Legislation Branch