12 November 1996 Internal T.I. 9627356 - 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.

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.

								November 12, 1996

	HEADQUARTERS					HEADQUARTERS
	Assessment of Returns			M. Eisner
	  Directorate
	Michel Trehan					(613) 957-2138
	Validation Section
								962735

Medical Expenses

This is in reply to your e-mail messages sent on August 8 and 12, 1996 and your facsimile dated September 26, 1996, concerning the above-noted subject. We also acknowledge our telephone conversation on October 18, 1996 in which we obtained clarification of some of the issues you raised.

Your queries and our comments are set out below.

E-Mail - August 21, 1996

Renovations and Alterations to a Dwelling

1.Paragraph 118.2(2)(l.2) of the Income Tax Act (the Act) refers to reasonable expenses for certain alterations or renovations to a home. With respect to this provision, you are concerned with the situation where a disabled person replaced the existing kitchen cabinets with new ones that are installed at a lower level. The concern is whether the replacement cost of the new cabinets is an eligible medical expense when the new cabinets are better than the old ones. In the event that the cost of the new cabinets is not an eligible expense, you asked whether costs could be allowed to the extent that they are considered to represent the cost of replacing the old cabinets with equivalent cabinets.

Our Comments

Provided the tests in paragraph 118.2(2)(l.2) of the Act are otherwise met, it is our view that the full costs of installing the new kitchen cabinets that enable a patient to be mobile or functional within the dwelling, qualifies as a medical expense to the patient.

The fact that new cabinets are of a higher quality than the existing ones should not matter generally, but the amount spent must be reasonable.

2.In a situation where a disabled person had previously lowered his or her kitchen cabinets and claimed the related expenses under paragraph 118.2(2)(l.2) of the Act, the concern is whether the expenses of installing new upgraded kitchen cabinets (to replace the cabinets that had been previously lowered) are eligible medical expenses.

Our Comments

Generally, it is our view that the cost of upgrading the quality of the kitchen cabinets that were already lowered to accommodate a patient, is not an eligible medical expense under paragraph 118.2(2)(l.2) of the Act. However, if because of further physical deterioration, it becomes necessary for the patient to incur additional renovation costs to continue to be mobile and functional within the dwelling, the disabled taxpayer will likely be able to show that he or she has a valid claim under that provision. Each case must be examined separately.

E-Mail August 23, 1996

1.Cost of Reports

You have referred to amounts paid to medical practitioners for preparing reports or certificates (e.g., form T2201 or a certificate with respect to work absence due to illness) which the patients need for various purposes. This fee is in addition to the cost of the medical services. You query whether the cost of preparing these reports is an eligible medical expense.

Our Comments

It is our view that the costs of preparing the reports can be considered to be amounts paid "in respect of medical or dental services" for the purposes of paragraph 118.2(2)(a) of the Act.

2.Prescription Filling Fees

You have also asked us whether a "prescription filling fee" (which is part of the cost of obtaining prescribed drugs) is an eligible medical expense. This fee is charged by pharmacists with respect to an item prescribed by a medical practitioner.

Our Comments

It is our view that the "prescription filling fee" will qualify as an amount paid for drugs pursuant to paragraph 118.2(2)(2)(n) of the Act.

Facsimile - September 26, 1996

1.You have asked us whether fees paid to a homeopathic clinic are eligible medical expenses.

Our Comments

In our view, fees paid in respect of homeopathic services are only eligible medical expenses under paragraph 118.2(2)(a) of the Act if they are paid to a medical practitioner. A medical practitioner is a person authorized to practice as such under the provincial laws of a province as provided by subsection 118.4(2) of the Act.

2.Your concern is whether the cost of nutritional supplements, botanical remedies, or homeopathic remedies, which are paid to a wellness clinic or a naturopathic clinic, are eligible medical expenses.

Our Comments

While there are a number of requirements set out in paragraph 118.2(2)(n) of the Act, the consideration is whether the remedies and supplements were purchased from a licensed pharmacist who has recorded the prescription in his prescription record. On the basis of the information provided to us, it is our view that the expenses are not eligible medical expenses. It is also possible that the remedies and supplements may not have been prescribed by a medical practitioner which is a further requirement in paragraph 118.2(2)(n) of the Act.

Other Comments

In your E-Mail of August 8, 1996 and your facsimile of September 9, 1996, you requested information on the provinces in which certain individuals could be considered to be medical practitioners. Unfortunately, we are not able to provide you with the information as we do not have a list which provides such details. As suggested in paragraph 4 of IT-519R, it will be necessary for you to determine whether a particular medical practitioner is authorized to practice a health discipline by referring to the applicable provincial law (or the relevant laws in other jurisdictions) in each case.

John F. Oulton
Section Chief
Business, Property and Personal Section
Business and Publications Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch