17 March 2010 External T.I. 2010-0355211E5 - Costs for Skating as Eligible Medical Expenses

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 costs of skating (costs for ice time and individual coach) incurred as therapy are eligible medical expenses for the purposes of the medical expense tax credit.

Position: No

Reasons: One of the conditions in subsection 118.2(2)(l.9) is that the therapy must be "administered under the general supervision of" a medical doctor, psychologist or occupational therapist. This condition is not met on the basis that a skating coach would not be considered to be administering therapy under the general supervision of a medical doctor, psychologist or occupational therapist.

								2010-035521
XXXXXXXXXX 							Chrys Tzortzis, CA
(613) 957-2082
March 17, 2010

Dear XXXXXXXXXX :

Re: Costs for Skating as Eligible Medical Expenses

This is in response to your letter of January 22, 2010, inquiring about whether the costs of skating incurred as therapy are eligible medical expenses for the purposes of the medical expense tax credit ("METC"). The skating costs include costs for ice time and for an individual coach. You stated that your daughter is eligible for the disability tax credit.

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 a request for an advance income tax ruling submitted in the manner set out in Information Circular 70-6R5, "Advanced Income Tax Rulings", dated May 17, 2002. This Information Circular and other Canada Revenue Agency publications can be accessed on the internet at http://www.cra-arc.gc.ca. Since your inquiry concerns an actual situation involving questions of fact, it should be dealt with by your local Tax Services Office. If you wish to have the CRA review your actual situation, you should submit all of the relevant information and documentation to the particular Tax Services Office serving your area, a list of which is available on the "Contact Us" page of the CRA website. Although we cannot comment on your specific situation, we are prepared to provide the following general comments, which may be of assistance.

Medical expenses which are eligible for the METC are limited to those described in subsection 118.2(2) of the Income Tax Act (the "Act"). If a particular expenditure is not described as an eligible medical expense in subsection 118.2(2) of the Act, or if the conditions under which the expenditure would qualify are not met, the expenditure does not qualify for purposes of the METC, even though the expenditure may have been incurred for medical reasons.

Subsection 118.2(2)(l.9) of the Act provides that an amount paid as remuneration for therapy provided to a patient because of the patient's severe and prolonged impairment qualifies as a medical expense provided certain conditions are met. The therapy must be prescribed by, and administered under the general supervision of, a medical doctor or a psychologist, in the case of mental impairment and a medical doctor or an occupational therapist, in the case of a physical impairment. At the time the remuneration is paid, the payee must be neither the individual's spouse nor an individual who is under 18 years of age. Each receipt filed with the Minister to prove payment of the remuneration must be issued by the payee and must contain, where the payee is an individual, that individual's Social Insurance Number. Finally, for the year the remuneration is paid, the patient must qualify for the disability tax credit under section 118.3 of the Act because of his or her impairment.

In the particular situation described in your letter, in our view, the condition that the therapy be "administered under the general supervision" of a medical doctor, psychologist or occupational therapist is not met. We also reviewed the other provisions in subsection 118.2(2) and, in our view, there is no provision that would allow such costs to qualify as medical expenses for the purposes of the METC. Further information on medical expenses may be found in Interpretation Bulletin IT-519 (Consolidated) -"Medical Expense and Disability Tax Credits and Attendant Care Expense Deduction" and the Guide RC4064, "Medical and Disability-Related Information" which are posted on the CRA website at www.cra-arc.gc.ca.

If all the conditions are met, such skating costs may qualify for the child fitness tax credit to a maximum of $500 of eligible fitness expenses which is supplemented by an additional amount of $500 for a child with a disability. Information on the child fitness tax credit is available on the CRA website.

We trust that these comments will be of assistance.

Yours truly,

G. Moore
For Director
Business and Partnerships Division
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch