13 December 2001 External T.I. 2001-0099245 - PHARMACIST PROGRAM & SERVICES

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 CCRA.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ADRC.

Principal Issues:

Do services and programs provided by a pharmacist that are not associated with "dispensing" of medication qualify as a medical expense?

Position TAKEN
No
REASON FOR POSITION TAKEN

Services and programs described would not qualify as medical expenses under paragraph 118.2(2)(n).

XXXXXXXXXX 2001-009924
C. Tremblay, CMA
December 13, 2001

Dear XXXXXXXXXX:

This is in reply to your letter of August 21, 2001, requesting whether certain services and programs would be considered medical expenses under subsection 118.2(2) of the Income Tax Act (the "Act"). Specifically, you enquire whether health programs and services not related to the dispensing of a prescription product are medical expenses for the purposes of the medical expense credit.

Our Comments

Under paragraph 118.2(2)(n) of the Act, an amount paid to a pharmacist as a dispensing fee, qualifies as a medical expense. Paragraph 118.2(2)(n) of the Act includes an amount paid for drugs, medicaments or other preparations or substances manufactured, sold or represented for use in the diagnosis, treatment or prevention of a disease, disorder, abnormal physical state, or the symptoms thereof or in restoring, correcting or modifying an organic function, purchased for use by the patient as prescribed by a medical practitioner or dentist and as recorded by a pharmacist. For purposes of the medical expense tax credit, a reference to a "pharmacist" means a person who is authorized to practice as such, according to the laws of the jurisdiction in which the pharmacist's services are offered. In our view, a dispensing fee includes charges for providing professional services such as patient counselling, monitoring drug therapy, providing drug information to physicians and dispensing drug products. It also covers maintaining patient medication records.

In order to be recognized as medical expenses, the cost of the proposed health programs and services would have to be considered dispensing fees in respect of an eligible medical expense under paragraph 118.2(2)(n) of the Act. You state that the proposed programs and services such as structured medication reviews, cholesterol screening/management program and smoking cessation counselling are not linked to the dispensing of medication. Accordingly, in our view the proposed programs and services would not qualify as medical expenses under paragraph 118.2(2)(n) of the Act.

The Canada Customs and Revenue Agency is responsible only for the administration of the Income Tax Act and not for any changes to the tax policy or for any amendment to the legislation. This is the responsibility of the Department of Finance. Should you wish to pursue your concern further, you may contact the Tax Policy Branch of the Department of Finance by writing to L'Esplanade Laurier, 140 O'Connor Street, Ottawa, Ontario K1A 0G5.

We trust our comments are of assistance.

Yours truly,

Steve Tevlin
for Director,
Business and Partnerships Division
Income Tax Rulings Directorate
Policy and Legislation Branch