17 January 2001 External T.I. 2000-0060755 - 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.

Principal Issues: An individual has had three operations as a result of cancer. In March of 2000, he was amputated at the torso and now relies on crutches for movement. As part of his physiotherapy program, he purchased a "hand-cycle" which is a special bicycle that is pedalled by hand instead of by foot. The hand-cycle will be used to strengthen the upper part of his body so he will be capable of manoeuvring his crutches. The issue is whether the cost of the hand-cycle qualifies for the medical expense tax credit.

Position: No

Reasons: It is not described within paragraph 118.2(2)(m) of the Income Tax Act and section 5700 of the Income Tax Regulations (or any other provision within subsection 118.2(2) of the Act).

XXXXXXXXXX 2000-006075
M. Eisner, CA
January 17, 2001

Dear XXXXXXXXXX:

Re: Medical Expenses - Hand-cycle for Physiotherapy

This is in reply to your letter of October 16, 2000, concerning the above subject.

In the situation outlined, an individual had three operations as a result of cancer. In March 2000, he was amputated at the torso and now relies on crutches for movement. As part of his physiotherapy program, he purchased a "hand-cycle," which is a special bicycle that is pedalled by hand instead of by foot. The hand-cycle will be used to strengthen the upper part of his body so that he will be capable of manoeuvring his crutches.

The issue is whether the cost of the hand-cycle qualifies for the medical expense tax credit under subsection 118.2(2) of the Income Tax Act (the "the Act").

Our Comments

Written confirmation of the tax implications inherent in particular transactions is given by this Directorate only where the transactions are proposed and are the subject matter of an advance ruling request. However, we are prepared to provide the following comments.

In order for the cost of a hand-cycle to qualify for the medical expense tax credit, it must be a medical expense under subsection 118.2(2) of the Act or be prescribed under section 5700 of the Income Tax Regulations (see paragraph 57 and the Appendix of IT-519R2 (enclosed)). Since a hand-cycle is not included thereunder, it is our view that the cost of such a device does not qualify for the medical expense tax credit.

Please note that the role of the Canada Customs and Revenue Agency is to administer and enforce the Act as passed by Parliament. Tax policy and amendments to the Act are 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 regret that we could not give you a favourable reply.

Yours truly,

John Oulton, CA
for Director
Business and Partnerships Division
Income Tax Rulings Directorate
Policy and Legislation Branch

??

- 2 -