18 May 1998 Internal T.I. 9809050 - MEDICAL EXPENSES- TRAVEL 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:

Travel expenses and the medical expense credit

Position:

Amount claimed must be reasonable - normally .10c per kilometre is reasonable.

Reasons:

118.2(2)(h) wording and Deptment’s position that reasonable travel expenses only include fuel (gas and oil) consumption.

XXXXXXXXXX 980905
C. Tremblay

May 19, 1998

DearXXXXXXXXXX,

Re: Medical Expenses- Travel Expenses

This is in reply to your letter of March 24, 1998, concerning claiming reasonable travel expenses under paragraph 118.2 (2)(h) of the Income Tax Act.

Paragraphs 32 to 35 of Interpretation Bulletin IT-519R2 (copy enclosed for your information) explain the circumstances under which travel costs may qualify as a medical expense for the purpose of the medical expense tax credit. In determining whether travel expenses incurred to obtain medical services qualify, the patient must travel at least 80 kilometers away from the locality where he or she dwells to get the medical services and meet the conditions that substantially equivalent medical services are unavailable within the patient’s locality, that the patient takes a reasonably direct travel route and that it is reasonable in the circumstances for the patient to travel to that place for the medical services. Proper receipts must support all amounts claimed as qualifying medical expenses including travel expenses.

Where receipts are not available, the Department is prepared to allow a reasonable estimate of the actual automobile costs incurred in relation to the distance traveled to obtain medical services. In the Department’s view, $.10 per kilometer is a reasonable amount that estimates the fuel consumption costs incurred for such travel. A higher per kilometer rate reflecting other operating expenses (e.g. regular maintenance, licenses and insurance) may be accepted where repeated use of the vehicle is required; however, no portion of the fixed costs or ownership costs, such as interest, capital cost allowance or lease cost are allowable. You may wish to contact the Regina Taxation Services Office to assist you in determining whether a higher per kilometer rate is reasonable in your particular situation.

We trust our comments are of assistance

for Director,
Business and Publications Division
Income Tax Rulings and
Interpretations Directorate
Policy and Legislative Branch