15 May 2002 External T.I. 2002-0120255 - MEDICAL PRACTITIONER

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 CCRA.

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

Principal Issues: whether counsellors in Nova Scotia are medical practitioners

Position: no, unless a specific law authorizes them to provide counselling

Reasons: 118.4(2)

XXXXXXXXXX 2002-012025

Denise Dalphy, LL.B.

(613) 941-1722
May 15, 2002

Dear XXXXXXXXXX:

Re: Meaning of "Medical Practitioners"

This is in reply to your correspondence of January 17, 2002 wherein you enquired whether a fee paid for counselling to a counsellor in Nova Scotia who is listed in the Registry of the Nova Scotia Association of Professional Counsellors will qualify for a medical expense tax credit.

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. Where 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.

The answer to your question is not clear-cut. The primary provision in the Income Tax Act (the "Act") that deals with the deductibility of medical expenses is paragraph 118.2(2)(a) of the Act. Pursuant to this paragraph, in order for an amount to be deductible as a "medical expense", the amount must be in respect of a medical or dental service and it must be paid to "a medical practitioner, dentist or nurse or a public or licensed private hospital".

Subsection 118.4(2) of the Act provides a definition of medical practitioners for the purposes of the medical expense provisions of the Act. We enclose a copy of the exact wording for your reference. (Please see Appendix I). Services are considered performed by a medical practitioner if, in general terms, those services are authorized by the laws of the jurisdiction where the services are provided to perform those services. A person is authorized by a province or other jurisdiction to act as a medical practitioner if there is specific legislation that enables, allows, permits, or empowers a person to practice assuch. Although the legislation does not have to use the words "medical practitioner", it would have to specifically allow a person to perform certain medical services. While a particular law may not indicate that a person can't perform specific services, it does not mean that the jurisdiction has authorized that person to perform medical services.

The Canada Customs and Revenue Agency (the "CCRA") is not aware of any specific legislation in Nova Scotia specifically or in Canada generally that regulates persons whose names have been listed on the registry of your Association. As such, counselling services provided by these individuals will not automatically be considered to be services provided by "medical practitioners" within the meaning of the Act. However, where counselling is provided by an individual who is authorized by specific legislation to provide counselling services (for example, perhaps pursuant to the Medical Act of Nova Scotia or the Psychologists Act of Nova Scotia) as a medical practitioner, the counselling would be a service provided by a "medical practitioner" within the meaning of the Act and the fees paid to such an individual may qualify as medical expenses for purposes of the Act.

In addition to paragraph 118.2(2)(a) of the Act discussed above, there are other provisions in the Act that permit the deduction of certain medical expenses. The list is lengthy, and so we have enclosed a copy of Interpretation Bulletin IT-519R2 (Consolidated) entitled, Medical Expense and Disability Tax Credits and Attendant Care Expense Deduction, for your reference. You have advised that you are aware of clients who have been referred by medical doctors for professional counselling services to counsellors who were neither social workers, nor psychologists as defined under the laws in Nova Scotia. The confidentiality provisions of the Act would preclude us from discussing the income tax affairs of any particular taxpayer's situation unless that person provided us with an authorization to do so in writing. However, it is possible that the amounts paid may have been deductible as therapy or tutoring services deductible pursuant to paragraph 118.2(2)(l.9) or 118.2 (2)(l.91) of the Act. The text of these deductions, which may be of particular interest to your Association is included in Appendix II.

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 CCRA. Our practice is to make this specific disclaimer in all instances in which we provide an opinion.

Yours truly,

Steve Tevlin
for Director
Business and Partnerships Division
Income Tax Rulings Directorate

APPENDIX I

"118.4 (2) Reference to medical practitioners, etc. - For the purposes of sections 63, 118.2, 118.3 and 118.6, a reference to an audiologist, dentist, medical doctor, medical practitioner, nurse, occupational therapist, optometrist, pharmacist, psychologist or speech-language pathologist is a reference to a person authorized to practise as such,

(a) where the reference is used in respect of a service rendered to a taxpayer pursuant to the laws of the jurisdiction in which the service is rendered;

(b) where the reference is used in respect of a certificate issued by the person in respect of a taxpayer, pursuant to the laws of the jurisdiction in which the taxpayer resides or of a province; and

(c) where the reference is used in respect of a prescription issued by the person for property to be provided to or for the use of a taxpayer, pursuant to the laws of the jurisdiction in which the taxpayer resides, of a province or of the jurisdiction in which the property is provided."

APPENDIX II

118.2 (l.9) as remuneration for therapy provided to the patient because of the patient's severe and prolonged impairment, if

(i) because of the patient's impairment, an amount may be deducted under section 118.3 in computing a taxpayer's tax payable under this Part for the taxation year in which the remuneration is paid,

(ii) the therapy is prescribed by, and administered under the general supervision of,

(A) a medical doctor or a psychologist, in the case of mental impairment, and

(B) a medical doctor or an occupational therapist, in the case of a physical impairment,

(iii) at the time the remuneration is paid, the payee is neither the individual's spouse nor an individual who is under 18 years of age, and

(iv) each receipt filed with the Minister to prove payment of the remuneration was issued by the payee and contains, where the payee is an individual, that individual's Social Insurance Number;

(l.91) as remuneration for tutoring services that are rendered to, and are supplementary to the primary education of, the patient who

(i) has a learning disability or a mental impairment, and

(ii) has been certified in writing by a medical practitioner to be a person who, because of that disability or impairment, requires those services,

if the payment is made to a person ordinarily engaged in the business of providing such services to individuals who are not related to the payee.