1 November 2002 External T.I. 2002-0168295 - MEDICAL EXPENSE-BACKUP GENERATOR

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: Does the cost of an emergency backup generator to assist in the
operation of a power-operated hydraulic lift qualify as a

medical expense?

Position: The cost does not qualify as a medical expense.

Reasons: The cost of a generator does not fall under any of the categories of qualifying medical expenses and, in particular, is not included in the list of prescribed devices described in Regulation 5700.

Bob Naufal, CMA
XXXXXXXXXX (613) 957-2744
2002-016829
November 1, 2002

Dear XXXXXXXXXX:

Re: Medical Expenses and Emergency Backup Generator

We are writing in response to your letter dated October 8, 2002, wherein you requested our comments as to whether the cost relating to the purchase and installation of an emergency backup generator would qualify as a medical expense for purposes of the medical expense tax credit. You wrote on behalf of your constituent, XXXXXXXXXX, who is permanently disabled and requires the aid of a hydraulic lift to get out of bed or leave his home. You stated that the back-up generator is required to ensure that the hydraulic lift remains operable during a hydro failure, thus allowing XXXXXXXXXX to get out of bed or leave his home.

Our Comments

Section 118.2 of the Income Tax Act (the "Act") provides rules for determining the amount that may be claimed, as a tax credit, in respect of medical expenses. The credit applies to qualifying medical expenses, in excess of defined limits, incurred in any 12-month period ending in the taxation year. Subsection 118.2(2) of the Act contains a list of expenditures that qualify as medical expenses. Included in that list is a payment in respect of prescribed medical devices and equipment. However, the list of prescribed medical devices or equipment does not include a generator. Accordingly, the cost relating to the purchase and installation of XXXXXXXXXX back-up generator does not qualify as a medical expense.

Please note that our conclusions are dictated by the provisions of the Act. As you are aware, the role of the Canada Customs and Revenue Agency is to administer and enforce the Act as passed by Parliament. In our view, a legislative amendment would be required to recognize the cost of a back-up generator as a medical expense. Since the primary responsibility for tax policy and legislation rests with the Department of Finance, we would encourage you to write to the Minister of Finance and advise him of XXXXXXXXXX circumstances. It is our understanding that Department of Finance is continually reviewing the legislation governing medical expenses to ensure that all proper costs incurred in connection with a medical disability are properly recognized for tax purposes.

While we regret that we could not give you a favourable reply, we trust that our comments are of assistance to you.

Yours truly,

D. Boychuk, LL.B
for Director
Business and Partnerships Division
Income Tax Rulings Directorate

- 2 -