27 May 1998 External T.I. 9808655 - PERITONEAL DIALYSIS ROOM 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.

Principal Issues: Medical expense tax credit for cost of a room in which peritoneal dialysis occurs?

Position: No.

Reasons: No provision in Act which qualifies such costs for medical expense tax credit.

XXXXXXXXXX 		980865
Wm. P. Guglich

May 27, 1998

Dear XXXXXXXXXX:

Re: Peritoneal Dialysis

This is in reply to your letter of March 25, 1998 concerning a medical expense tax credit for the cost of a room in which peritoneal dialysis treatment occurs.

We understand that peritoneal dialysis uses the peritoneal membrane as a filter device. To gain access, a catheter is surgically inserted through the wall of the peritoneal cavity. Dialysis solution is infused into the peritoneal cavity. By the process of diffusion and osmosis, toxins and excess fluids move across the membrane into the solution. After a predetermined dwell period, the solution is drained from the cavity through the catheter. Continuous ambulatory peritoneal dialysis ("CAPD") is a manual process using gravity to fill and drain the solution. Automated peritoneal dialysis ("APD") uses a machine to exchange the dialysis fluid several times during the night while the patient sleeps.

In the case of APD, expenses for or in respect of an artificial kidney machine could qualify as medical expenses under paragraph 118.2(2)(i) of the Income Tax Act (the "Act"). However, there is no provision in the Act which qualifies expenses, related to the premises or room where the CAPD or APD is performed, for the medical expense tax credit.

We trust our comments will be of assistance to you.

Yours truly,

P. Spice
for Director
Business and Publications Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislation Branch