2 February 2012 External T.I. 2011-0423231E5 - METC - Yoga Fees & 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.

Principal Issues: 1- Whether yoga fees qualify as eligible medical expenses for the purposes of the medical expense tax credit ("METC") if recommended by a doctor. 2- Whether an individual can claim the travel expenses of more than one accompanying individual as eligible medical expenses for the purposes of the METC.

Position: 1- No 2- No

Reasons: 1- There is no provision in the Act that allows yoga fees to be claimed as eligible medical expenses even if recommended by a doctor. 2- Wording of paragraphs 118.2(2)(g) and (h) of the Act state "one individual who accompanied the patient".

XXXXXXXXXX
					2011-042323
					Chrys Tzortzis, CA

February 2, 2011

Dear XXXXXXXXXX :

Re: Eligible Medical Expenses

We are writing in reply to your email dated October 3, 2011, wherein you inquire whether yoga fees qualify as eligible medical expenses for the purposes of the medical expense tax credit ("METC") if recommended by a doctor. In addition, you inquire whether an individual can claim the travel expenses of more than one accompanying individual as eligible medical expenses for the purposes of the METC.

Written confirmation of the tax consequences that apply to a particular fact situation is given by this Directorate only in the context of an advanced income tax ruling request 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 CRA Web site at www.cra-arc.gc.ca. However, we are prepared to provide the following general comments, which may be of assistance.

In general, an individual may claim the METC in respect of eligible medical expenses incurred in respect of the individual, the individual's spouse, the individual's common-law partner, a child of the individual who is under 18 years of age, or a dependant of the individual (referred to below as the "patient"). For the purposes of the METC, a "dependant" of an individual for a taxation year means a person who at any time in the year is dependent on the individual for support and is (a) the child (who is 18 years of age or older) or grandchild of the individual or of the individual's spouse or common-law partner or (b) the parent, grandparent, brother, sister, uncle, aunt, niece or nephew, if resident in Canada at any time in the year, of the individual or of the individual's spouse or common-law partner. The individual may only claim the eligible medical expenses in respect of the dependant that exceed the lesser of 3 per cent of the dependant's income for the year and an indexed dollar threshold.

Medical expenses which are eligible for the METC are limited to those described in subsection 118.2(2) of the Income Tax Act ("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. In our view, there is no provision in the Act that would allow yoga fees to qualify as eligible medical expenses for the purposes of the METC even if recommended by a doctor.

Under paragraph 118.2(2)(g) of the Act, an individual may claim as an eligible medical expense an amount paid to a person engaged in the business of providing transportation services, to the extent that the payment is made for the transportation of

(i) the patient, and

(ii) one individual who accompanied the patient, where the patient was, and has been certified by a medical practitioner to be, incapable of travelling without the assistance of an attendant

from the locality where the patient dwells to a place, not less than 40 kilometres from that locality, where medical services are normally provided, or from that place to that locality, if

(iii) substantially equivalent medical services are not available in that locality,

(iv) the route travelled by the patient is, having regard to the circumstances, a reasonably direct route, and

(v) the patient travels to that place to obtain medical services for himself or herself and it is reasonable, having regard to the circumstances, for the patient to travel to that place to obtain those services.

In addition, under paragraph 118.2(2)(h) of the Act, an individual may claim an amount paid for reasonable travel expenses (for example, accommodation and meals) incurred in respect of the patient and, where the patient was, and has been certified by a medical practitioner to be, incapable of travelling without the assistance of an attendant, in respect of one individual who accompanied the patient, to obtain medical services in a place that is not less than 80 kilometres from the locality where the patient dwells if the circumstances described in subparagraphs (g)(iii), (iv) and (v) above apply.

Accordingly, in our view, an individual may claim the transportation and travel expenses incurred for only one accompanying individual as eligible medical expenses for the purposes of the METC (if all the above conditions are met) even if more than one individual accompanied the patient.

We trust that these comments will be of assistance.

Yours truly,

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