14 February 2005 External T.I. 2004-0106351E5 - Medical Expenses - Supplements

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.

Principal Issues: Whether the amounts paid by the taxpayer to a Naturopath for supplements that can be purchased without a prescription qualify as a medical expense for the purposes of calculating the medical expense tax credit.

Position: NO.

Reasons: The amounts paid by the taxpayer to a Naturopath for medicaments were not recorded by a pharmacist as required pursuant to paragraph 118.8(2)(n) of the Act. Jurisprudence on point.

2004-010635
XXXXXXXXXX Luisa A. Majerus, CA
(613) 957-2138
February 14, 2005

Dear XXXXXXXXXX

Re: Medical Expenses - Supplements

This is in reply to your letter dated November 30, 2004, requesting confirmation that certain supplements qualify as medical expenses for the purposes of calculating the medical expense tax credit under section 118.2 of the Income Tax Act (the "Act").

Specifically, you have purchased supplements (potassium orotate, alpha-lipoic acid, pro EPA) from a Naturopath as part of the recommended treatment of your medical condition. The supplements, along with other services provided were included in the total invoice. The supplements can be purchased without a prescription. It is your understanding that these supplements may qualify as a medical expense because a qualifying medical practitioner prescribed the supplements and you paid for the supplements as part of the medical services rendered.

Our Comments

Written confirmation of the tax implications inherent in particular transactions is given by this Directorate only where the transactions are proposed and are the subject matter of an advance income tax ruling request submitted in the manner set out in Information Circular 70-6R5, Advance Income Tax Rulings, dated May 17, 2002. Where the particular transactions are completed, the inquiry should be addressed to the relevant Tax Services Office. However, we offer the following general comments.

Subsection 118.2(2) of the Act includes three provisions describing the types of drugs, medicaments and other preparations that may qualify as medical expenses. These are:

(a) drugs, medicaments or other preparations or substances, that are prescribed by a medical practitioner, and purchased from a pharmacist who records the prescription in a prescription record, pursuant to paragraph 118.2(2)(n);

(b) insulin, oxygen and liver extract injectible for pernicious anaemia and vitamin B12 for pernicious anaemia, that are prescribed by a medical practitioner, but which a pharmacy or any other type of store may sell without a written prescription, pursuant to paragraph 118.2(2)(k); and

(c) the incremental cost of gluten-free food products, as compared to the cost of comparable non-gluten-free food products, if the patient has been certified in writing by a medical practitioner to be a person who, because of celiac disease, requires a gluten-free diet, pursuant to paragraph 118.2(2)(r).

In order for the amounts described in (a) above to qualify as medical expenses they must be manufactured, sold or represented for use in:

(i) the diagnosis, treatment or prevention of a disease, disorder or abnormal physical state, or

(ii) the treatment of the symptoms of a disease, disorder or abnormal physical state, or

(iii) restoring, correcting or modifying an organic function.

The requirements of paragraph 118.2(2)(n) set out above do not necessarily preclude vitamins and minerals, which also happen to be available over the counter without a prescription. However, in our view, the cost of such items generally would only qualify as a medical expense if they were prescribed by a medical practitioner and recorded by a pharmacist. We are unaware of any situation where a licensed pharmacist is required to record the prescription of vitamins and minerals in a prescription record in accordance with the relevant provincial legislation governing such professions.

Since a pharmacist is not required to record the purchase of the supplements from the Naturopath, it is our view that the amounts paid for the supplements will not qualify as a medical expense under paragraph 118.2(2)(n) of the Act.

We trust these comments are helpful.

Yours truly,

John Oulton, CA
For Director
Business and Partnerships Division
Income Tax Rulings Directorate
Policy and Planning Branch