See Also
Warnock v. The Queen, 2014 DTC 1176 [at 3658], 2014 TCC 240 (Informal Procedure)
Woods J found that, because "patient" is defined in s. 118.2(2)(a) to include only the individual who is claiming a medical expense tax credit, or the individual's spouse, common-law partner or dependant, the individual cannot claim a medical expense tax credit in respect of a surrogate mother for her child.
Subsection 118.2(1) - Medical expense credit
Administrative Policy
15 November 2012 External T.I. 2012-0456201E5 F - Frais médicaux - calcul et dépenses non admissibles
A taxpayer who incurred eligible medical expenses during the 12-month period beginning on January 1, 2011 wishes to claim a METC for only a portion of the medical expenses incurred in 2011, with the balance claimed for the 2012 taxation year. In this permitted? CRA responded:
[F]or an individual who did not die during the year, Element B of the METC formula in subsection 118.2(1) includes the total of the individual's medical expenses, evidenced by receipts filed with the Minister, if those expenses have not already been included in the calculation of a deduction for medical expenses for a preceding taxation year and if they were paid by the individual during a 12-month period ending during the year. …
[T]o be eligible as medical expenses for the purposes of the METC, the expenses must be incurred, paid for, and evidenced by a receipt within the same 12-month period ending in a taxation year. …[W]here eligible medical expenses have been certified by a receipt, paid for and incurred during the 12-month period beginning on January 1, 2011 and ending on December 31, 2011, they cannot be the subject of a deferral of deduction.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(o) | emergency call service through telemonitoring ineligible | 152 |
| Tax Topics - Income Tax Regulations - Regulation 5700 - Section 5700 - Paragraph 5700(e) | non-custom shoes would not qualify | 118 |
6 December 2016 External T.I. 2015-0589041E5 F - Frais médicaux payés d’avance - prepaid medical expenses
After noting that fees (e.g., to a dentist) will not be recognized as medical expenses until they are incurred (i.e., the related services are performed (so that, for example, fees prepaid in 2015 for services to be performed in 2016 would not qualify as medical expenses in 2015), CRA went on to confirm that:
[A]n individual may choose any 12-month period ending in the year…[but the] individual's medical expenses must have been paid…during the period so chosen. …
For example, where an individual chooses the period from January 1 to December 31, 2016…[i]f the…fees were paid on December 31, 2015, they would not be eligible for the METC computation for the 2016 taxation year…. However, these fees paid on December 31, 2015 could be included in the computation of the METC for a selected period that included December 31, 2015. If this were the case… the individual could if so desired file an application to amend his or her 2015 income tax return to include those expenses in the computation of the METC for the selected period that included December 31, 2015.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(a) | prepaid expenses not recognized before incurred | 290 |
8 June 2015 External T.I. 2014-0529851E5 F - Frais payés à une maison de santé ou de repos
An individual incurs $24,000 from being hospitalized in July 2013. Would the individual be able to claim $10,000 as a 2013 expense and also treat the balance of $14,000 as having been paid in the 12-month period ending in June 2014 and claim the $14,000 in the return for 2014? CRA responded:
The 12-month period chosen by the taxpayer for a taxation year is not required to be retained for subsequent taxation years. Therefore, claims in 2013 may include fees paid between January 1, 2013 and December 31, 2013 and an application in 2014 for the same taxpayer may include fees paid between June 1, 2013 and May 31, 2014 or any other such 12 month period ending in 2014, provided no expenses are taken into account twice in the calculation of the medical expenses tax credit.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(e) | no 2nd credit under s. 118.3 re accommodation expenses in nursing home | 143 |
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(d) | floor of retirement residence servicing those with advanced Alzheimer’s can qualify as “nursing home” | 210 |
Subsection 118.2(2) - Medical expenses
Cases
Weeks v. Canada, 2001 DTC 5035 (FCA)
The Minister allowed some medical expense tax credits in respect of care for a son of the taxpayer who suffered from congenital brain malformation [ultimately] but disallowed credits in respect of such items as books, compact discs, toys, computer equipment, and a van that was used by all family members. The taxpayer unsuccessfully advanced a Charter remedy that would have involved a judicial redrafting of s. 118.2(2) to allow a medical expense tax credit for all disability related expenses, including those incurred in the home rather than in an institution. The taxpayer failed to advance evidence to establish that the differential treatment accorded by s. 118.2(2) to institutional and home care gave families an incentive to choose institutional care for their disabled children over home care, thereby (as it was argued) perpetuating an historic negative stereotyping of disabled people.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Other Legislation/Constitution - Charter (Constitution Act, 1982) - Subsection 15(1) | 139 |
See Also
AB v. The Queen, 2014 DTC 1140 [at 3379], 2014 TCC 157 (Informal Procedure)
Apart from some concessions from the Minister, Campbell J disallowed the taxpayer's claims for medical expense tax credits relating to in vitro fertilization treatments in New York and then in the Ukraine.
Unlike Zieber, which dealt with a fertilized egg, an unfertilized egg does not satisfy the dictionary definition of an "organ" (para. 18) and therefore in vitro fertilization is not an "organ transplant" under s. 118.2(2)(l.1).
Similar in vitro treatments were available in Canada, so the taxpayer's transport, accommodation, and food expenses did not qualify under ss. 118.2(2)(g) or (h). The deduction of wiring and banking fees are not provided for anywhere in s. 118.2.
Greenaway v. The Queen, 2010 DTC 1065 [at 2846], 2010 TCC 42 (Informal Procedure)
The taxpayer , who had progressive multiple sclerosis, claimed a medical expense tax credit under s. 118.2(2)(e) for payments to "Huron Lodge Home for the Aged." The Minister held that the expenses more properly fell under s. 118.2(b) as nursing home expenses, and therefore denied a disability tax credit under s. 118.3(1)(c). Hogan J. granted the taxpayer's appeal. Because the expenses qualified under both s. 118.2(2)(b) and (e), the taxpayer was free to choose the more favourable treatment.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(c) | 81 |
Zieber v. The Queen, 2008 DTC 4175, 2008 TCC 328 (Informal Procedure)
Beaubier D.J. found that the taxpayer's expenses relating to transplanting his and his wife's embryo into a surrogate mother qualified for a medical expense tax credit. He stated (at paras. 7-8):
In the view of the Court, a fertilized egg or embryo such as the one in question, is adapted by its structure to grow into a complete human being.
For these reasons, the Court finds that the embryo transplant in question constituted an organ transplant within the meaning of paragraph 118.2(2)(l.1) of the Act and the expenses allowable are those described therein. They were incurred by the Appellant on behalf of the patient who required the organ transplant with one exception.
Rannelli v. MNR, 91 DTC 816, [1991] 2 CTC 2040 (TCC)
In finding that tuition fees paid to a private school which restricted its enrolment to children suffering from dyslexia were deductible under s. 110(1)(c)(vi), Sobier J. stated that the word "cares" should be interpreted "in a solicitous, nurturing, sympathetic or emphatic sense" (p. 818).
Administrative Policy
25 July 1994 External T.I. 9406905 - MEDICAL EXPENSES - TRAVELLING EXPENSES
An individual who required medical treatment and returned from Florida to Canada to be treated rather than being treated in Florida, would not be entitled to the deduction under s. 118.2(2)(g).
23 March 1994 Internal T.I. 9406816 - COMPUTER COST AS A MEDICAL EXPENSE
The cost of personal computers is not allowable in the computation of the medical expense tax credit.
24 July 1992 External T.I. 7-921677 -
In order for a facility to qualify as a "nursing home" for purposes of paragraph (b) or (d), it must have competent medical personnel in a sufficient number so as to provide medical care to patients on a 24-hour basis. "Full-time care" means required constant care. Personal expenses, such as the cost of a hairdresser, are not eligible as medical expenses.
Expenses paid to a home for the elderly, which provides its residents with meals, social activities, drug control, minimal physical assistance (such as required to take a bath), promotional health programs and a licenced nurse on a 24-hour basis, would likely be considered personal or maintenance expenses.
15 January 1992 T.I. (Tax Window, No. 15, p. 22, ¶1701)
The cost of airfare for a taxpayer and his nurse/companion to Arizona (in order to avoid adverse medical effects of Canadian winters) would not qualify under s. 118.2(2)(g) or (h).
27 August 1991 T.I. (Tax Window, No. 8, p. 17, ¶1417)
The cost of cosmetic surgery that is not undertaken to maintain or restore health and that does not prevent or cure illness is not a medical expense.
28 March 1991 Memorandum (Tax Window, No. 1, p. 17, ¶1179)
The cost of electrolysis treatments prescribed by a medical practitioner for hormone imbalances does not qualify because an esthetician is not a medical practitioner.
6 March 1991 Memorandum (Tax Window, No. 1, p. 16, ¶1149)
Tuition fees paid to private schools catering to children with learning disabilities do not qualify as "medical expenses".
14 December 1989 Memorandum (May 1990 Access Letter, ¶1230)
The cost of a house built to accommodate personnel suffering from a particular disability, including capital cost allowance and property taxes, did not qualify for deduction.
27 July 1989 T.I. (Dec. 89 Access Letter, ¶1055)
"Medical practitioner" refers to a person authorized to practise as such pursuant to the laws of the relevant jurisdiction, and therefore does not include a practitioner of "alternative medicine."
IT-519 "Medical Expenses and Disability Tax Credits"
Paragraph 118.2(2)(a)
Administrative Policy
21 November 2017 CTF Roundtable Q. 16, 2017-0703891C6 - Medical assistance in dying
CRA indicated that the qualifying costs of medically-assisted dying where there is compliance with the detailed procedures set out in the Criminal Code and various provincial rules would qualify for the medical expense tax credit. By implication, the costs of going abroad for the procedure might not qualify.
Neal Armstrong. Summary of 21 November 2017 CTF Annual Conference CRA Roundtable (Official Response), Q.16 under s. 118.2(2)(a).
6 December 2016 External T.I. 2015-0589041E5 F - Frais médicaux payés d’avance - prepaid medical expenses
What impact does the timing of payment of medical expenses have on the computation of the medical expense tax credit ("METC") in s. 118.2(1), e.g., where fees are paid on January 1, 2015 for a dental treatment plan under which the services would be rendered in 2015 and 2016?
CRA responded that “an individual's medical expenses include expenses paid to a dentist which are for dental services provided to the individual in the taxation year in which the expenses were incurred,” so that fees which were prepaid in 2015 for services charges that would not be incurred in 2016, such fee could not qualify as medical expenses until 2016. After stating that it could be considered that “an expense is ‘incurred’…only where there is an obligation to pay a sum of money,” CRA went on to state:
[I]f it is established that that the services are provided and the expenses are incurred in 2016, the expenses paid to a dentist for dental services would be medical expenses under paragraph 118.2(2)(a) as long as the expenses were paid at some time. The time of payment may be before or after 2016.
CRA went on to confirm that for purposes of computing the medical expense tax credit ("MEC") in s. 118.2(1) for a year, an individual may choose any 12-month period ending in the year, but that the medical expenses must have been paid during the period so chosen. For example, if dental fees were paid on December 31, 2015, they would not be eligible for the METC computation for the 2016 taxation year if the individual had selected the calendar year, but such fees could be included in the computation of the METC in the 2016 return if the selected period included December 31, 2015.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(1) | example of the election to claim medical expenses (that are not a prepayment for a future year’s services) on a lagged basis | 183 |
21 January 2016 Roundtable, 2016-0624871C6 F - Colloque CPA- Frais médicaux - medical expenses
Can an orthodontist’s travel expenses qualify as a medical expense? CRA stated (TaxInterpretations translation):
[M]edical services are diagnostic, therapeutic or rehabilitative services that are performed by a medical practitioner acting within the scope of his or her professional training. Thus, in general, the transportation of a medical practitioner (for example, an orthodontist) is not a medical service, and the fees paid for such travel would not be fees paid for medical or dental services.
Are osteopaths and naturopaths practising in Quebec health professionals for the purposes of the medical expenses tax credit? CRA responded:
Osteopaths and naturopaths in Quebec are not included in the health professionals (or "medical practitioners", as defined in subsection 118.4(2) of the ITA) who are recognized for purposes of the Medical Expense Tax Credit.
CRA then referenced the Authorized medical practitioners by province or territory for the purposes of claiming medical expenses list.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(d) | nursing home can be part of a facility | 152 |
13 November 2014 External T.I. 2014-0523911E5 F - Frais médicaux
Medical expenses that are paid for the services provided by an orthotherapist or an osteopath in the province of Quebec are not eligible for purposes of the medical expense tax credit, as there is no legislation in Quebec which authorizes orthotherapists or osteopaths to provide medical services or to exercise medicine in Quebec.
11 September 2014 External T.I. 2014-0529901E5 - Medical Expense - Vasectomy Reversal
Would a vasectomy reversal qualify? CRA stated:
[T]he fact that a service or procedure is elective would not disqualify it from being considered a medical service. … [A]n amount paid for a medical service that relates to an existing medical condition or illness, for example, infertility, would likely qualify as a medical expense… .
5 September 2014 External T.I. 2014-0529101E5 - METC - Hyperbaric Oxygen therapy
Were costs of hyperbaric oxygen therapy administered by a registered respiratory therapist in a private clinic in Alberta eligible? CRA stated that "the Treatment could be considered a medical service when it is offered to an individual for therapeutic or rehabilitative reasons," and that "a respiratory therapist is authorized to practise in the province of Alberta and would be considered a medical practitioner."
2 May 2014 External T.I. 2014-0520551E5 F - Frais médicaux à l'extérieur du Canada
The individual had a worsening medical condition for which his specialist did not recommend surgery given the risks, and the second specialist in the region was too busy to provide a second opinion. He located the "Organization" promoting medical services in Country A, and used its services in accessing lumbar surgery there (accompanied by his spouse). Respecting the costs of his hospitalization, CRA stated:
In general, eligible medical expenses are not limited to expenses paid in Canada or medical services provided in Canada. Thus … the hospitalization expenses … may be eligible medical expenses if the hospital in Country A is a public hospital or a private licensed hospital and the fees were paid for medical services.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(h) | accommodation re surgery abroad could qualify even if surgery available locally | 248 |
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(g) | travel to get surgery abroad could qualify as reasonable even where available locally | 249 |
28 November 2013 External T.I. 2013-0499731E5 - Medical Expense
fees paid to a medical practitioner to obtain Special Authority status for a prescription medication qualified as a medical expense under s. 118.2(2) as "the completion of the form(s) for Special Authority by a medical practitioner would normally be ancillary to the medical service provided by the practitioner."
28 March 2013 External T.I. 2012-0465171E5 F - Frais médicaux - technicien en orthophonie
After a physician’s referral, the taxpayer’s child (with a severe and prolonged impairment entitling the taxpayer to a credit for mental or physical impairment under s. 118.3) has been using the services of a speech-language pathologist in the private sector, who can only provide services to the child once every two weeks – so that for the other weeks, the child is seen by a specialized speech therapy technician to whom the child was referred by the speech-language pathologist.
In the course of finding that the taxpayer would not be entitled to claim the medical expense tax credit (the “METC”) respecting the fees of the technician, CRA stated:
[W]e are not aware of any legislation in Quebec that would authorize speech therapy technicians to provide, as such, medical services in Quebec. Thus, the fees paid to these technicians are not eligible … .
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(l.9) | services of speech therapy technician, who supplemented speech-language pathologist’s services, were ineligible as being unsupervised by a doctor | 170 |
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(o) | services of speech therapy technician did not assist in diagnosis | 162 |
S1-F1-C1 - Medical Expense Tax Credit
As evidence of amounts paid to a licensed private hospital outside of Canada, an individual's METC claim should include records indicating:
[F]ull particulars of the licence under which the facility operates, as well as the details of the professional qualifications of the medical staff in attendance and of the medical or remedial care given to the patient to whom the expense relates.
8 November 2011 Internal T.I. 2011-0416651I7 F - Crédit d'impôt pour frais médicaux
In order to finance the cost of surgery, the taxpayer took out a bank loan. Did the interest expense qualify? CRA responded:
[T]he interest expense incurred by the taxpayer in respect of dental services is not an expense paid to a medical practitioner, dentist or nurse or a public or licensed private hospital … [and] those interest expenses do not qualify for the medical expense tax credit pursuant to paragraph 118.2(2)(a).
12 September 2011 External T.I. 2011-0397731E5 F - Crédit d'impôt pour frais médicaux
Expenditures for aquatherapy classes did not qualify. Although they were prescribed by the taxpayer’s doctor, they were not paid to a medical practitioner, dentist or nurse or a public or licensed private hospital.
Respecting pain management courses, CRA stated:
such expenses will be eligible for the METC if both of the following conditions are satisfied:
- they have been incurred for diagnostic, therapeutic or rehabilitative services for a pre-existing medical condition;
- they have been paid to a medical practitioner or a public or licensed private hospital.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Regulations - Regulation 5700 - Section 5700 - Paragraph 5700(h) | "hospital bed" does not extend to all types of adjustable beds | 93 |
11 February 2011 External T.I. 2010-0386651E5 F - Admissibilité - Frais médicaux
In response to a query of the manager of a health care spending account as to whether an expenditure qualified under s. 118.2(2), CRA stated:
[A]lthough … it is difficult … to comment on the application of [s. 118.2(2)(a)] with respect to costs related to a preliminary report of a genetic counsellor to establish the risk of breast cancer, we would generally be of the opinion that such costs are not incurred for maintaining health, preventing disease and diagnosing or treating an injury, illness or disability. As a result, such costs would not be provided for in subsection 118.2(2).
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(o) | pathology expenses paid to physician would qualify | 89 |
1 February 2011 External T.I. 2010-0386621E5 F - Prélèvement et conservation de cellules souches
In indicating that the expenses associated with harvesting and storing stem cells are ineligible for the credit, CRA stated:
[P]aragraph 118.2(2)(a) applies only to a pre-existing medical condition. … [S]ince the collection and storage of stem cells is not a procedure related to an existing medical condition or injury … the costs associated with this service would not qualify for the medical expense tax credit.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(o) | stem cell harvesting and storage costs ineligible as do not assist in diagnosis etc. | 100 |
29 May 2006 Internal T.I. 2006-0171931I7 F - Medical expense tax credit - XXXXXXXXXX
The taxpayer, who had been incurring medical expenses for his disabled child, made a donation to a charity, which subsequently paid the fees for the treatment.
The Directorate found that the donation did not qualify as a charitable donation, but that the amount qualified for credit under s. 118.2(2)(a), given that the medical services were provided by or under the supervision of a medical doctor.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.1 - Subsection 118.1(1) - Total Charitable Gifts | “donation” to medical clinic which treated taxpayer’s son did not qualify as a charitable gift | 69 |
Paragraph 118.2(2)(b)
Administrative Policy
2 June 2010 External T.I. 2009-0343381E5 F - Frais de préposé aux soins
A mother of an autistic child, who qualifies for the credit for mental impairment in subsection 118.3(1), hired an applied behaviour analysis therapist to intellectually stimulate her child, and who cares for the child 35 hours a week, using an individual analysis teaching methodology to stimulate cognitive skills on a daily basis and increase the child’s autonomy – as well as applying behavioural strategies. CRA stated:
[Such] expenses … cannot be characterized as for "care" within the meaning of paragraph 118.2(2)(b) since what is involved is more a matter of there being a learning endeavour in order to meet the personal needs of the person with an impairment than of assisting that person in daily activities that the person cannot perform on the person’s own because of the person’s impairment.
However … if the therapist's expenses satisfy all the conditions of application of one of paragraphs 118.2(2)(a), (e), (I.9) or (I.91), the therapist's fees could then give rise to an entitlement to the tax credit … .
7 February 2000 External T.I. 2000-0000555 - NURSING HOME FEES-FOOD & ACCOM.
"Generally, all regular fees charged by a nursing home, including any component for accommodation or meals, are normally accepted as being on account of full-time care in a nursing home. On the other hand, an amount charged for meals and accommodation in a place which does not ordinarily provide full-time nursing care to its residents would not be considered an amount paid for full-time care in a nursing home."
30 June 1995 External T.I. 9507885 - MEANING OF "ONE FULL TIME ATTENDANT"
After referring to the Wakelyn case (71 DTC 35) where "the Tax Appeal Board held that the phrase 'one full-time attendant' should not be interpreted to mean one attendant only looking after the patient on a continuous basis without a respite but rather that several attendants could be utilized over a specified period so long as the claim for tax purposes included only one attendant for any given portion of that period", RC stated that more than one attendant could be utilized "provided that the period of care provided by each attendant did not overlap".
Paragraph 118.2(2)(b.1)
See Also
Olney v. The Queen, 2014 DTC 1193 [at 3732], 2014 TCC 262 (Informal Procedure)
The taxpayer had been born under the effects of thalidomide, leaving her with virtually no arms and small hands with just three fingers. The Minister rejected her claims for medical expenses that were based on attendant care. The expenses included a cell phone, CAA membership, clothing alterations, and a personal trainer.
C Miller J allowed the taxpayer's appeal on the basis that the clothing alterations and personal trainer were medical expenses and the cell phone and CAA membership were not. The alterations and trainer were "attendant care" for essentially the same reasons that housekeeping services were in Zaffino. It was irrelevant that the clothing alterations took place outside the home, as it was within the range of what an attendant might be expected to do.
Even taking an expansive, compassionate view (as is required) of s. 118.2(2)(b.1), the cell phone and CAA membership fell outside of it, as there was no "attendant" to provide the alleged attendant care.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(l.9) | "general supervision" included doctor's giving of instructions, via the patient, to a personal trainer | 111 |
| Tax Topics - Income Tax Act - Section 62 - Subsection 62(1) | scouting trip is not a moving expense | 33 |
Zaffino v. The Queen, 2007 DTC 1178, 2007 TCC 388 (Informal Procedure)
In finding for the taxpayer, Woods J. rejected a submission of the Crown that because the only kind of assistance provided by a service provider was housecleaning, such services could not qualify as "attendant care".
Administrative Policy
8 July 2013 Internal T.I. 2012-0472651I7 F - Crédit pour l'embauche par les petites entreprises
A taxpayer who does not carry on a business and who hires and remunerates employees such as a home care worker, a gardener, a maid, a housekeeper and a cleaner as well as other employees. The Directorate stated:
[I]f a person is employed to provide a single service, such as providing household or transportation services, the provision of these services is not considered to be attendant care.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 9 - Exempt Receipts/Business | small business job credit received for payroll of non-business employees, exempt | 109 |
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(3) - Paragraph 118.2(3)(b) | small business job credit received for personal-care workers was “reimbursement” | 131 |
S1-F1-C1 - Medical Expense Tax Credit
Depending on the situation, [attendant care] tasks could include meal preparation, maid and cleaning services, transportation, and personal services such as banking and shopping. Attendant care would also include providing companionship to a patient. However, if a person is employed as a single service provider, such as a provider of only maid and cleaning services, or a provider of only transportation services, the provision of such service would not be viewed as attendant care. Where the expression one full–time attendant is used, it is not intended to mean one attendant only looking after the patient on a continuous basis but rather several attendants could be utilized over a specific period of time so long as there is only one attendant for any given period of time.
S1-F1-C1 - Medical Expense Tax Credit
For the care for a person with a disability, a taxpayer could claim the full amount of the cost of attendant care with no disability tax credit, or claim a limited amount of the cost of attendant care plus a disability tax credit. CRA states:
The CRA Web site provides additional information, including examples, to assist taxpayers in determining which approach is more beneficial to them. This information is found on the CRA Web site under Attendant care or care in an establishment claimed as medical expenses.
S1-F1-C1 - Medical Expense Tax Credit
Amounts that are actually paid to an attendant for salary or remuneration as well as the employer's portion of employment insurance premiums, Canada or Quebec Pension Plan contributions, and workers' compensation insurance premiums will qualify as medical expenses under paragraph 118.2(2)(b). Imputed salary or remuneration will not qualify since no actual payment is made.
Paragraph 118.2(2)(b.2)
Administrative Policy
S1-F1-C1 - Medical Expense Tax Credit
Amounts that are actually paid to a group home for remuneration for care or supervision of the patient, including the employer's portion of employment insurance premiums, Canada or Quebec Pension Plan contributions, and workers' compensation insurance premiums, qualify as medical expenses under paragraph 118.2(2)(b.2). Imputed salary or remuneration will not qualify since no actual payment is made.
Paragraph 118.2(2)(c)
See Also
Greenaway v. The Queen, 2010 DTC 1065 [at 2846], 2010 TCC 42 (Informal Procedure)
The taxpayer , who had progressive multiple sclerosis, claimed a medical expense tax credit under s. 118.2(2)(e) for payments to "Huron Lodge Home for the Aged." The Minister held that the expenses more properly fell under s. 118.2(2)(b) as nursing home expenses, and therefore denied a disability tax credit under s. 118.3(1)(c). Hogan J. granted the taxpayer's appeal. Because the expenses qualified under both s. 118.2(2)(b) and (e), the taxpayer was free to choose the more favourable treatment.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) | 81 |
Paragraph 118.2(2)(d)
Administrative Policy
May 2016 Alberta CPA Roundtable, Q.16
CRA indicated that “in an effort to reduce the delay in completing reviews related to nursing homes, CRA created an internal list of qualifying facilities to keep track of those facilities that had already been contacted,” but that CRA auditors have been instructed “not to disallow a claim because an institution does not appear on this internal list” (which will not be published).
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Regulations - Regulation 5700 - Section 5700 - Paragraph 5700(n) | Segway modifications/tricyle wheelchairs qualify | 192 |
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(i) | geriatric chair with wheels is wheelchair | 56 |
21 January 2016 Roundtable, 2016-0624871C6 F - Colloque CPA- Frais médicaux - medical expenses
Respecting whether a private seniors’ residence was a “nursing home,” CRA stated (TaxInterpretations transalation):
[T]he requirement [in S1-F1-C1, para. 1.33] that a facility "offers 24-hour nursing care" would not be satisfied if the establishment offers limited nursing care. This would be the case, for example, where the only nursing care a facility offers its residents is to make available an on-call nurse or where the number of applicable residents does not permit the staff to provide nursing care around the clock.
It may be that the same institution offers several levels of care so that a floor or part of the facility is reserved for residents who are unable to care for themselves and need nursing care 24 hours a day. In such cases, the establishment may qualify as a nursing home with respect to that floor or part of the facility only.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(a) | expenses of doctor travel and of Quebec naturopaths and osteopaths excluded | 182 |
8 June 2015 External T.I. 2014-0529851E5 F - Frais payés à une maison de santé ou de repos
Can accommodation expenses paid to a retirement home for a patient with advanced Alzheimer's and who is on a floor with other high-need seniors qualify as expenses of full time care in a nursing home for the purposes of s. 118.2(2)(d)? CRA responded:
The fact that a person lives in a retirement residence and has Alzheimer's disease at a stage requiring the help of others for personal needs and care may be an element that helps leads to a determination that the person lives in a nursing home, but this does not automatically qualify the residence as a nursing home. In addition, other criteria such as the number of staff at the facility, their skills and the equipment available in order to provide nursing care to patients 24 hours a day are elements that may be considered to establish if a retirement residence is a nursing home. To the extent that the floor where this person lives meets the above criteria, we believe that the residence can qualify as a nursing home with respect to that floor. Accordingly, the expenses of full-time care in respect of that floor could qualify for the tax credit under subsection 118.2(2)(d) if the other conditions therein provided are satisfied.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(e) | no 2nd credit under s. 118.3 re accommodation expenses in nursing home | 143 |
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(1) | expenses can be claimed based on 12-month period ending in year | 123 |
S1-F1-C1 - Medical Expense Tax Credit
While a particular place need not be a licensed nursing home, it must have the equivalent features and characteristics of a nursing home. For example, a nursing home is normally a facility of a public character which offers 24-hour nursing care to patients who are not related to the facility owner/operator. The use of the expression full–time care in a nursing home is not intended to place a requirement of a minimum time spent caring for a patient but rather implies the constant care and attendance required by the patient by reason of an injury, illness or disability of the patient. The CRA is generally of the view that a retirement home does not provide the care required to be classified as a nursing home. [Emphasis added.]
S1-F1-C1 - Medical Expense Tax Credit
For the care for a person with a disability, a taxpayer could claim the full amount of the cost of attendant care with no disability tax credit, or claim a limited amount of the cost of attendant care plus a disability tax credit. CRA states:
The CRA Web site provides additional information, including examples, to assist taxpayers in determining which approach is more beneficial to them. This information is found on the CRA Web site under Attendant care or care in an establishment claimed as medical expenses.
Paragraph 118.2(2)(e)
Cases
Canada v. Scott, 2008 DTC 6682, 2008 FCA 286
On the advice of her pediatrician, the taxpayer enrolled her son, who was diagnosed with several learning disabilities, in a private school. Her tuition was not creditable given that the school did not specially provide equipment, facilities or personnel for the care of students with particular needs such as those of her son, and also given that the doctor did not express a formal expert opinion to the taxpayer at any time before she filed her income tax return.
Canada v. Title Estate, 2001 DTC 5236, 2001 FCA 106
A certificate stating that "this person requires a supervised setting since January 31, 1995 due to medical illness. This person requires a 24-hour companion", did not satisfy the requirements of s. 118.2(2)(e) because it did not specify a mental or physical handicap from which the patient suffered, and the equipment, facilities or personnel that the patient required in order to obtain the care or training needed to deal with the handicap.
Anka v. Canada, 97 DTC 5290 (FCA)
Given the clear finding of fact made by the Tax Court judge that nothing linked tuition paid for the attendance of the taxpayer's child at nursery and elementary school and for swimming and ballet lessons to the child's speech and language problems, there was no basis for reversing a finding that the medical expense credit under s. 118.2(2)(e) (and under s. 118.2(2)(h)) was not available.
See Also
Leibovich v. The Queen, 2016 DTC 1016 [at 2612], 2016 TCC 6 (Informal Procedure)
The taxpayer’s son (“J”) was diagnosed with “Central Auditory Processing Dysfunction.” The clinical report made several classroom recommendations. The tuition fees paid by the taxpayer to the St. George’s School of Montreal did not qualify as medical expenses under s. 118.2(2)(e), given that the 3rd and 4th tests in Collins were not satisfied. Respecting the 3rd test, Smith J stated (at para. 46):
[T]he school… offers the same school program and curriculum to all students and the adapted academic environment offered to J and other students with learning disabilities…is incidental and ancillary to its primary or dominant purpose of providing a high school education to all its students, including J.
Respecting the 4th test, he stated (para. 48):
[T]he Clinical Reports fail to establish a need for special equipment, facilities or personnel. Although there are practical suggestions such as the use of a personal FM auditory system and visual learning aids, for example, many of the recommendations would apply to the general student population.
Karn v. The Queen, 2013 DTC 1082 [at 452], 2013 TCC 78 (Informal Procedure)
The taxpayer claimed a medical expense tax credit for tuition paid to a specialized private education school for her son. The Minister disputed the claim on the basis that the taxpayer's son was not certified as having a sufficient disability.
Campbell J granted the taxpayer's appeal. Her son was diagnosed over the course of two years by three different doctors, each of whom provided reports. Two of the letters declined to recommend that the son change schools, and on that basis Campbell J found that they were not certifications under s. 118.2(2)(e). The third was a certification - it clearly specified that the son had ADHD and potentially other learning disabilities, explained how they contributed to his learning difficulties, and stated:
An additional component of L's treatment for these learning disabilities is the need for placement in a specialized school which provides specialized teacher training and very specific individual program plans, optimizes the teacher to student ratio and provides a high level of individualized support. L is currently attending Calgary Academy, a school which I strongly recommend as it provides the facilities and personnel described above.
This amounted to a certification.
Bauskin v. The Queen, 2013 DTC 1068 [369], at 2013 TCC 64
On the advice of a doctor, the taxpayer sent his son, who had ADHD, to a specialized program at a private school (the "Crestwood Transitions Program"). By the year in question, the son had completed eighth grade, which was the Transitions Program's highest grade, and had switched into Crestwood's normal program. He still received supplemental assistance such as extra time to write exams and extra help with classwork, at no additional charge to the taxpayer.
Woods J. found that no portion of the tuition could be deducted under s. 118(2)(2)(e) for the year in question. The letter that purportedly certified the taxpayer's son only referred to the facilities provided by the Transition Program. Woods J stated (at para. 12):
Since it does not address equipment, facilities or personnel provided by the mainstream program, I conclude that this letter does not satisfy the certification requirement.
Lucarelli v. The Queen, 2012 DTC 1250 [at 3716], 2012 TCC 301 (Informal Procedure)
Woods J. dismissed the Minister's contention that the taxpayer's school tuition for her dyslexic son did not meet the certification requirements under s. 118.2(2)(e). The son's doctor ("Dr. Johnston") wrote two letters that, in combination, established the son's specialized educational needs. Woods J. stated (at paras. 21-22):
Although neither assessment evaluated particular schools, the evidence of the principal of the TALC Academy made it clear that the methodology of the school was to do precisely what Dr. Johnston had recommended, which was to teach in a way that bypassed the child's problem areas. ...
It seems to me that the legislative requirements are satisfied in circumstances where Dr. Johnston's report specifies the nature of the disability and the type of training that is required, and the evidence establishes that the TALC Academy specializes in providing this type of training for children with this disability.
Piper v. The Queen, 2010 DTC 1343 [at 4311], 2010 TCC 492 (Informal Procedure)
The taxpayer's child had a severe learning disability. The taxpayer enrolled her at a private school, where she received special attention from one teacher, who she started and ended each day with, quiet rooms for studying when she was not in class, computer equipment, and a special education plan based on her doctor's report.
Nevertheless, Bowie J. found that the taxpayer's expenses for tuition and course materials could not be deducted from income. As per Scott, the expense of the child attending the institution must be inextricably tied to the specific needs of that child. He stated (at para 9):
In plain English, GNS is not a special school for handicapped or learning disability children. It is an academic institution that prepares its students for the rigour of a university education. It is, however, capable of accommodating those children who meet its admission standards, but have physical or learning disabilities.
Collins v. The Queen, [1998] 3 C.T.C. 2981 (TCC)
The taxpayer, whose son suffered from a mental handicap, satisfied the requirements of s. 118.2(e), so that a credit was available. Rowe J noted (at para. 20) that the following critieria must be satisfied:
- The taxpayer must pay an amount for the care or care and training at a school, institution or other place.
- The patient must suffer from a mental handicap.
- The school, institution or other place must specially provide to the patient suffering from the handicap, equipment, facilities or personnel for the care or the care and training of other persons suffering from the same handicap.
- An appropriately qualified person must certify the mental or physical handicap is the reason the patient requires that the school specially provide the equipment, facilities or personnel for the care or the care and training of individuals suffering from the same handicap.
Having concluded that the taxpayer’s son suffered from a mental handicap, Rowe J. found (at paras. 36, 38):
…Choice was a school that had personnel who were specially trained and provided to deal with gifted children who were also suffering from learning disorders sufficiently serious to constitute a mental handicap. No special equipment is needed but the key is small class size with a great deal of individualising attention in accordance with the appropriate program designed for a particular student… .
Choice was a school which specially provided…both facilities and personnel for the care or for the care and training of persons suffering from the same mental handicap – ADHD – although only one or the other is required to meet the language of the provision.
Respecting the issue of certification, he stated (at para. 40) that the medical practitioner had concluded that the child:
should be educated at a school which could provide proper care or care and training for someone suffering from ADHD… . Choice was an appropriate school to assist in treating that disorder and otherwise dealing with the mental handicap… .
Administrative Policy
8 June 2015 External T.I. 2014-0529851E5 F - Frais payés à une maison de santé ou de repos
IT-519R2, paras. 29-30 indicated that the fees paid to a nursing home could qualify as eligible medical expenses under s. 118.2(2)(e), whereas this reference is dropped in Folio S1-F1-C1. Does this position remain valid? CRA responded:
The 2005-0155731E5 and 2008-0293121I7 technical interpretations no longer represent the position of the CRA to the extent that both tax credits could simultaneously be claimed if the costs referred to in those letters were living expenses for stays in a nursing home. Indeed, the tax credit described in section 118.3 may not be claimed where accommodation expenses for a nursing home are claimed as medical expenses, regardless of under which paragraph in subsection 118.2(2) the medical expenses tax credit has been claimed, with the exception of paragraph 118.2(2)(b.1) in respect of remuneration for attendant care for an individual.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(d) | floor of retirement residence servicing those with advanced Alzheimer’s can qualify as “nursing home” | 210 |
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(1) | expenses can be claimed based on 12-month period ending in year | 123 |
12 February 2008 Internal T.I. 2007-0240721I7 F - Crédit d'impôt pour frais médicaux
Regarding the ineligibility of fees paid for therapeutic riding sessions (recommended by a physiatrist for a child with encephalopathy with quadriparesis) under s. 118.2(2)(e), the Directorate stated:
Under the ejusdem generis rule of interpretation, the term "other place", which is part of the enumeration "in a school, institution or other place", should derive its meaning from the terms preceding it. It is our view that a therapeutic riding school cannot be considered an "other place" for the purposes of paragraph 118.2(2)(e) since it is not a place sufficiently similar to a school or institution. Consequently, in this situation, the taxpayer is not entitled to the medical expense tax credit for the expenses incurred for the therapeutic riding sessions for the taxpayer’s son.
S1-F1-C1 - Medical Expense Tax Credit
CRA provides a detailed opinion on the kind of expenses that it will consider to be eligible medical expenses under s. 118.2(2)(e).
- School tuition is generally an eligible medical expense in its entirety notwithstanding that a portion of the fees could be construed as tuition unrelated to the student's disability (para. 1.59).
- "Where the cost of care or care and training in respect of an eligible person with a disability is claimed as an eligible medical expense under paragraph 118.2(2)(e), a claim for the disability tax credit would not generally be denied underparagraph 118.3(1)(c)" (para. 1.61.).
- The cost of care or training for a patient with a drug or alcohol addiction can qualify under s. 118.2(2)(e). There is no requirement that a detoxification clinic be a public or licensed private hospital, but the requirements in paragraph (e) must be met (paras. 1.62-1.63).
Paragraph 118.2(2)(g)
Cases
Canada v. Tallon, 2015 DTC 5082 [at 6023], 2015 FCA 156
The taxpayer, who resided in Thunder Bay, suffered from temporomandibular joint dysfunction, requiring prosthetic joints that were sensitive to cold. She spent the six coldest months of the year in warmer climates in Southeast Asia or Latin America.
Ryer JA allowed the Minister's appeal and denied the taxpayer's claim of a medical expense tax credit for $17,531 of airfare, accommodations and meals expenses incurred by her and her husband for a trip in 2009 to Thailand and Indonesia. Under a purposive interpretation of ss. 118.2(2)(g) and (h), "the medical services contemplated by this provision must be provided to the patient by a person or hospital," and the textual limitation of s. 118.2(2)(a) to "a medical service…obtained from a person or hospital who or which provides such services… should carry over and become the correct interpretation of the term "medical services" in paragraph 118.2(2)(g) [or (h)]" (para. 38). Accordingly, "because the salutary effects of the warm Thai and Indonesian climates were not provided to the Taxpayer by a person or hospital, those effects cannot constitute a medical service" (para. 43).
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Statutory Interpretation - Consistency | stipulation on "medical services" in one paragraph carried over to another paragraph in same subsection that did not include that stipulation | 93 |
| Tax Topics - Statutory Interpretation - Hansard, explanatory notes, etc. | Hansard referred to in purposive interpretation | 57 |
See Also
Tokarski v. The Queen, 2012 DTC 1138 [at 3213], 2012 TCC 115 (Informal Procedure)
The taxpayer's transportation expenses in respect of dental procedures in Poland were not deductible even though the cost of the procedure in her locality exceeded her means. The costs in Poland and Canada were approximately $10,000 and $30,000. Hershfield J. stated (at para. 31):
The language "substantially equivalent medical services are not available in that locality", does not speak of whether the service is available to the particular taxpayer.
Sienema v. The Queen, 2010 DTC 1320 [at 4215], 2010 TCC 468 (Informal Procedure)
The taxpayer, diagnosed with psioriasis and psioratic arthritis, needed a hot tub and UVB phototherapy unit. Unable to install the equipment in his condo, he drove regularly to his parents house, 50 kilometers away, where the equipment was installed. Little J. found that the taxpayer's resulting transportation and meal expenses were deductible under paragraph 118.2(2)(g). The use of a hot tub and UVB unit was medical treatment even though it was self-administered. Little J., applying Patton v. The Queen, 2005 DTC 1786, therefore concluded that the taxpayer was recieving "medical services" as per clause 118.2(2)(g)(v).
Travel and meal expenses for the taxpayer's attendant were not deductible. The attendant was not "engaged in the business of providing transportation services." Moreover, claiming transportation expenses for both the taxpayer and attendant was excessive given that they travelled in the same car.
Johnson v. The Queen, 2010 DTC 1213 [at 3568], 2010 TCC 321 (Informal Procedure)
Frequent flyer points applied by the taxpayer to purchase air tickets to Chicago for medical treatment there constituted "an amount paid" for purposes of s. 118.2(2)(g).
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - General Concepts - Payment & Receipt | frequent flyer points | 28 |
Patton v. The Queen, 2005 DTC 1786, 2005 TCC 704 (Informal Procedure)
The taxpayer's daughter, who had learning disabilities, attended at a special school where a portion of the day was devoted to specific exercises to improve cognitive processing. Paris J. found that the taxpayer was entitled to claim the expenses of driving her daughter to and from the school as being in respect of obtaining "medical services" given that this term included "any services relating to the scientific diagnosis, treatment and prevention of disease, not just those provided by a medical practitioner or a medically trained person" (p. 1789), and the activities undertaken at the school represented a "form of neurological therapy designed to treat a medical condition".
Administrative Policy
2 May 2014 External T.I. 2014-0520551E5 F - Frais médicaux à l'extérieur du Canada
The individual had a worsening medical condition for which his specialist did not recommend surgery given the risks, and the second specialist in the region was too busy to provide a second opinion. He located the "Organization" promoting medical services in Country A, and used its services in accessing lumbar surgery there (accompanied by his spouse).
Respecting the eligibility of the related airline ticket expenses, and after referencing the 40-kilometre test, CRA stated:
For these expenses to qualify under paragraph 118.2(2)(g), the following conditions must also be met:
(a) substantially equivalent medical services are not available in that locality;
b) the route travelled is, having regard to the circumstances, a reasonably direct route
c) it is reasonable, having regard to the circumstances, for the patient to travel to that place to obtain those services.…[T]he condition listed in (a) could be met even if medical services are available at a location closer to the patient's place of residence, provided that it was reasonable in the circumstances that the patient moved to the locality where the medical services were received.
Paragraph 118.2(2)(g) also allows a taxpayer to claim the same type of transportation expenses described above for one individual who accompanied the patient, where the patient was, and has been certified in writing by a medical practitioner to be, incapable of travelling without the assistance of an attendant.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(a) | hospitalization expenses at a foreign public hospital or a private licensed hospital could qualify | 121 |
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(h) | accommodation re surgery abroad could qualify even if surgery available locally | 248 |
5 April 2013 External T.I. 2013-0478271E5 F - Frais médicaux- déplacements- pénurie de médecins
A patient (the taxpayer) moved from Locality A to Locality B but, due to a shortage of family doctors in Locality B, could not be taken on as a patient there and, therefore, would travel approximately 330 kilometers to get medical care from the patient’s family doctor in Locality A. After referencing the requirement in s. 118.2 (2)(g) that substantially equivalent medical services are not available in the patient’s current locality, CRA stated that this condition:
could be satisfied even if medical services are available at a locality closer to the patient's place of residence, provided that it was reasonable in the circumstances that the patient moved to the locality where the medical services were received.
5 April 2013 External T.I. 2012-0463351E5 F - Frais médicaux - déplacements hors du pays
The taxpayer was treated for a rare type of cancer in the U.S. Subsequently, a drug which the taxpayer had been taking became available in Canada. However, but the taxpayer’s doctors in Canada and the U.S. that the taxpayer should continue to be followed by the doctor in the U.S., and the taxpayer considers that the U.S. doctor has more expertise and seems able to offer alternative treatments that are not available in Canada in the event that the taxpayer stops responding to this medication.
After summarizing ss. 118.2(2)(a), (g) and (h), and noting that one of the rquirements in s. 118.2(2)(g) was that substantially equivalent medical services are not available in [the patient's] locality CRA stated that such condition:
could be satisfied even if medical services are available at a location closer to the patient's place of residence, provided that it was reasonable in the circumstances that the patient moved to the locality where the medical services were received.
Subparagraph 118.2(2)(g)(iii)
Administrative Policy
23 January 2008 Internal T.I. 2007-0255351I7 F - Frais médicaux - déplacement
Do travel expenses incurred by the taxpayer to receive specific medical treatment qualify under ss. 118.2(2)(g) and (h), where similar medical treatment with higher risks and permanent sequelae is available in the taxpayer's region? The Directorate responded:
[Per] E2002-0121825 … if the taxpayer provides a written certification from the taxpayer's physician that, in his or her opinion, on the basis of the taxpayer's medical condition, the taxpayer is unable to obtain substantially equivalent medical treatment … the travel expenses would be eligible. … This certificate should state the reasons why the physician is of the opinion that there are no adequate and appropriate medical services in the venue where the patient resides.
Paragraph 118.2(2)(h)
See Also
Jordan v. The Queen, 2013 DTC 1015 [at 77], 2012 TCC 394 (Informal Procedure)
Woods J allowed the deduction under s. 118.2(2)(h) of travel expenses for the taxpayer's almost daily trips between Weyburn and Regina to assist with his spouse's recovery from brain damage, which required extensive therapy. There was solid evidence that the taxpayer's daily presence contributed significantly to her recovery.
Bell (2009 DTC 1342, 2009 TCC 523) concluded that 118.2(2)(h) includes travel costs of a spouse who accompanied the patient and lived away from home during the period of treatment. Woods J stated that this interpretation was "a very reasonable one in the context of a broadly-worded and ambiguous provision" (para. 12).
Administrative Policy
12 July 2018 Ministerial Correspondence 2018-0761301M4 - Method used to establish mileage rates
In response to a query on the methodology used to establish the kilometric rate for travel for medical expense tax credit purposes, CRA stated:
The CRA uses these kilometric rates according to guidelines from the Treasury Board of Canada Secretariat (TBS). These guidelines are based on the rates set by the National Joint Council (NJC) of the Public Service of Canada. The CRA has always accepted the NJC rates as fair and reasonable. The NJC determines the rates by analyzing new vehicle prices, depreciation and financing rates, current fuel prices, insurance premium rates, and operating costs in each province or territory. When these costs increase or decrease, the kilometric rates change accordingly.
…at njc-cnm.gc.ca/doc.php?did=117&lang=eng#tc-tm_4_1 … includes a link to the kilometric rates for each Canadian province and territory.
2 May 2014 External T.I. 2014-0520551E5 F - Frais médicaux à l'extérieur du Canada
The individual had a worsening medical condition for which his specialist did not recommend surgery given the risks, and the second specialist in the region was too busy to provide a second opinion. He located the "Organization" promoting medical services in Country A, and used its services in accessing lumbar surgery there (accompanied by his spouse).
Respecting the eligibility of the related airline ticket expenses, and after referencing the 40-kilometre test and the three tests in subparas. (g)(iii) to (v) and stating re (g)(iii) that its “could be met even if medical services are available at a location closer to the patient's place of residence, provided that it was reasonable in the circumstances that the patient moved to the locality where the medical services were received,” CRA then referred to the 80-kilometer test in s. 118.2(2)(h), and stated respecting their accommodation and meal expenses in Country A (including during convalescence):
In general, we are of the view that paragraph 118.2(2)(h) applies under the same conditions as set out above, whether the expenses were incurred and paid in Canada or elsewhere.
CRA also noted:
In addition, the medical expenses described in paragraph 118.2(2)(h) may include reasonable accommodation and meal expenses in respect of one individual who accompanied the patient, provided that the patient has been certified in writing by a medical practitioner to be incapable of travelling without the assistance of an attendant.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(a) | hospitalization expenses at a foreign public hospital or a private licensed hospital could qualify | 121 |
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(g) | travel to get surgery abroad could qualify as reasonable even where available locally | 249 |
28 November 2010 Annual CTF Roundtable, 2013-0507301C6 - Cost of Travel as Medical Expense - 2010 CTF
Travel expenses may include expenses for meals, accommodations, and public transportation or, where public transportation is not readily available, vehicle expenses. An individual can choose the detailed method or the simplified method for calculating vehicle and meal expenses.
If a medical practitioner certifies that an individual is incapable of travelling alone to obtain medical services, the individual can also claim the travel expenses of an accompanying attendant.
For more information, see "Meal and Vehicle Rates Used To Calculate Travel Expenses for 2010".
Paragraph 118.2(2)(i)
Administrative Policy
May 2016 Alberta CPA Roundtable, Q.16
Respecting the eligibility of tricycles and bicycles, CRA stated:
Paragraph 118.2(2)(i)...allows an amount paid for a wheelchair as an eligible medical expense. While this provision would not encompass a standard bicycle or tricycle in the definition of wheelchair, we have previously opined that a wheelchair could include a tricycle wheelchair or geriatric chair with wheels.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(d) | CRA internal nursing home list | 63 |
| Tax Topics - Income Tax Regulations - Regulation 5700 - Section 5700 - Paragraph 5700(n) | Segway modifications/tricyle wheelchairs qualify | 192 |
S1-F1-C1 - Medical Expense Tax Credit
CRA provides comments on the terms:
- "iron lung" (para. 1.75);
- "wheelchair" (para. 1.76);
- "brace for a limb" (para. 1.77);
- "ileostomy or colostomy pads" (para. 1.78);
- "laryngeal speaking aid" (para. 1.79);
- "aid to hearing" (paras. 1.80-1.81); and
- "artificial kidney machine" (paras. 1.82-1.86).
2 March 2011 External T.I. 2010-0378071E5 F - CIFM - Quadriporteur
Is a taxpayer entitled to the medical expense tax credit ("METC") under s. 118.2(2)(i) for the cost of a scooter where, even if he can walk, he cannot drive a car or walk long distances because of partial vision loss?
CRA indicated that the purchase of a scooter will qualify for the medical expense tax credit where it is acquired in place of and instead of a conventional wheelchair, that is, where the taxpayer has difficulty in walking, or cannot walk.
17 December 2009 External T.I. 2009-0351781E5 F - MAP - Fauteuil roulant
CRA stated:
[T]he term "wheelchair" in paragraph 118.2(2)(i) is not restricted to the conventional arm-powered or battery-powered wheelchairs but also includes scooters and wheel-mounted geriatric chairs. This term also includes both manual wheelchairs and power wheelchairs.
Paragraph 118.2(2)(i.1)
Administrative Policy
S1-F1-C1 - Medical Expense Tax Credit
To the extent that items such as bed clothing, disposable gloves for caregivers, body ointments and baby wipes are generic and not designed for use by incontinent persons, the expenses would not be considered medical expenses under paragraph 118.2(2)(i.1).
Paragraph 118.2(2)(j)
Administrative Policy
S1-F1-C1 - Medical Expense Tax Credit
The phrase, "other devices for the treatment or correction of a defect of vision" includes contact lenses. To be eligible, the item must be prescribed by a medical practitioner (oculist or ophthalmologist) or an optometrist. Fees paid to a medical practitioner for eye exams and treatments, such as laser eye surgery, are generally considered eligible medical expenses under paragraph 118.2(2)(a) ... .
Paragraph 118.2(2)(k)
Administrative Policy
S1-F1-C1 - Medical Expense Tax Credit
Although insulin substitutes are not covered under paragraph 118.2(2)(k), they are generally considered drugs, medicaments and other preparations or substances, the cost of which is an eligible medical expense under paragraph 118.2(2)(n) provided the requirements under that provision are otherwise met. Furthermore, when a patient with diabetes has to take sugar-content tests using test-tapes or test tablets and a medical practitioner has prescribed this diagnostic procedure, the tapes or tablets qualify as devices or equipment under paragraph 118.2(2)(m) and section 5700 of the Regulations (see Devices and equipment prescribed by regulation [at para. 1.118]). An amount paid by patients with diabetes for a scale to weigh themselves or their food is not an eligible medical expense under any provision of subsection 118.2(2).
Paragraph 118.2(2)(l.1)
Administrative Policy
31 July 2007 Internal T.I. 2007-0237541I7 F - Frais de déplacement, de pension et de logement
Parents and their twin babies must travel to another region in order for the twins to receive a spinal cord transplant. A preparatory period and then, following the transplant, a period of isolation would require a hospital stay of up to four and a half months. On the recommendation of a doctor, in order to give the parents an occasional break, two other attendants are also present in the hospital. Regarding the availability of a credit under s. 118.2(2)(l.1), CRA stated:
[E]ach parent may claim the METC for travel, board and lodging expenses under paragraph 118.2(2)(l.1). In particular, expenses that will be incurred both at the transplant stage (including the preparatory and isolation stages) and for the follow-up visits for the year following the transplant will be eligible for the METC.
However, we are of the view that the attendants will not be able to claim an METC for expenses under paragraph 118.2(2)(l.1) since that paragraph states that only one person accompanying the patient may claim such expenses.
Paragraph 118.2(2)(l.2)
Cases
Canada v. Gibson, 2002 DTC 6724, 2001 FCA 356
In dismissing the Crown's application, Rothstein J.A. stated (at p. 6724):
"We agree with the applicant that the availability of a tax credit under paragraph 118.2(2)(l.2) is not predicated on an individual's difficulty in working, but rather on the ability of an individual to be mobile or functional within a dwelling. However, we are satisfied that there was evidence before the Tax Court judge that the respondent had a severe and prolonged mobility impairment and that the alterations to her dwelling enabled her to be functional within the dwelling."
See Also
Shallhorn v. Agence du revenu du Québec, 2019 QCCQ 449
S. 752.0.11.1(r) of the Quebec Taxation Act provided a credit (on the satisfaction of further conditions):
for reasonable expenses relating to renovations or alterations to a dwelling of a person who lacks normal physical development or has a severe and prolonged mobility impairment, to enable the person to gain access to, or to be mobile or functional within, the dwelling, provided that those expenses
- are not of a type that would typically be expected to increase the value of the dwelling, and
- are of a type that would not normally be incurred by a person who has normal physical development or who does not have a severe and prolonged mobility impairment;
The taxpayer, who was paraplegic, incurred approximately $80,000 to install an elevator ("élévateur mécanique") in his home, which thereby gave him access to both floors. He was the sole occupant. His doctor had completed forms supporting other medical expenses of the taxpayer relating to his paraplegic condition in the past (e.g., adapting his vehicle), and following denial of the credit by the ARQ, issued a “to whom it may concern” letter stating “Patient requires elevator in house for medical reasons.”
After noting the position of the ARQ that the credit was unavailable because the elevator was not designed solely for use by those who were handicapped, Laurin J stated (at para. 24, TaxInterpretations translation) and before allowing the appeal:
In the eyes of the Court, it is impossible to conceive of a lift or elevator which would prevent a non-handicapped person from using the device. It is well known that a handicapped person, before moving around in a wheelchair, needs a larger platform than a non-handicapped person. In applying the ARQ interpretation, no lift or elevator could give rise to an expense for medical expense purposes. Such an interpretation goes against the purpose of the Act … .
Sotski v. The Queen, 2013 DTC 1229 [at 1257], 2013 TCC 286 (Informal Procedure)
The taxpayer's husband had Parkinson's disease, and was at risk of falling on the carpeted floors. Accordingly, the taxpayer replaced the carpeting with laminate flooring.
Pizzitelli J found that s. (l.2) did not apply to make the related expenses non-creditable. The laminated floors do not generally represent an increase in value over carpeted floors. As to (l.2)(ii), he found it would be more consistent with Parliament's intention to find that the floor installation would not normally be incurred by persons with normal physical development. He stated (at para. 11):
The Budget Papers and explanatory notes make it clear the two conditions were inserted to ensure the taxpayer was not subsidizing personal consumption and personal choices. I agree with the Appellant that if her only choice was to install low-cost laminate floors to deal with her husband's condition, then there is no element of personal consumption or choice here that the taxpayer is being asked to fund.
Anthony v. The Queen, 2012 DTC 1275 [at 3808], 2012 TCC 334 (Informal Procedure)
The taxpayer's METC claim for a hot tub was denied on the same reasoning as in Johnston.
Johnston v. The Queen, 2012 DTC 1175 [at 3437], 2012 TCC 177 (Informal Procedure)
The taxpayer installed a hot tub to be used as a hydrotherapy pool for her daughter, who had cerebral palsy-related spastic quadriplegia and other conditions. Boyle J. found that the installation was excluded under s. 118.2(2)(l.2) from qualifying for a medical expense tax credit. Although subparagraph (i) did not apply (it was generally accepted that a hot tub, like a pool, will tend to limit the available market for a property and therefore not increase the value of the dwelling), subparagraph (ii) did. Boyle J. stated (at para. 12):
I must take judicial notice that many fully able bodied Canadians put similar hot tubs in their homes and yards. In my opinion, a typical hot tub generally available in the retail market such as the Johnstons' is not able to satisfy this final requirement.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Other Legislation/Constitution - Charter (Constitution Act, 1982) - Subsection 15(1) | 155 |
Barnes v. The Queen, 2009 DTC 1554, 2009 TCC 429 (Informal Procedure)
A swimming pool which the taxpayer built in his backyard for the purposes of permitting essential physiotherapy to be conducted for the benefit of his disabled daughter did not qualify given that many fully able bodied Canadians installed pools such as this in their backyards.
Sokolowski v. The Queen, 2003 DTC 2150, 2003 TCC 730 (Informal Procedure)
Additional costs incurred by the taxpayer, who was suffering from multiple sclerosis but not yet confined to a wheelchair, in constructing his principal residence in order to make it easier for him to navigate the home including by wheelchair, were found to qualify. The lesions on his brain indicated a lack of normal physical development of his brain; and the costs were incurred to enable him to have mobility. There was no requirement that he be required to wait until the disease totally crippled him before the costs of an elevator shaft would qualify. Miller J. stated (at p. 2153) that "in dealing with medical expenses generally, the Court should give the most equitable and large interpretation compatible with the attainment of the legislation's object".
Hillier v. The Queen, 2000 DTC 2145 (TCC) (Informal Procedure)
In finding that the additional cost of constructing a new home that were attributable to the need to establish a contaminant-free environment for the daughter of the taxpayer (who is suffering from pervasive developmental disorder) qualified for credit, Bowman TCJ. stated (at p. 2147):
"All alterations or renovations involve in some degree the creation of something new. I see no reason why this should not, in the context of this legislation, involve the creation of a new structure where there must be changes and additions to conventional plans to incorporate special features necessary to accommodate the medical needs of a particular person."
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Statutory Interpretation - Interpretation Act - Section 12 | 46 |
Administrative Policy
31 July 2014 External T.I. 2014-0535011E5 - Medical expenses - Generator and vehicle expenses
A disabled child requires breathing equipment. Would the cost of purchasing and installing an emergency, whole-house generator to power the breathing equipment (in case of a power outage) qualify? CRA stated:
[I]t is not clear to us that the installation of a whole-house generator meets all of the requirements.
S1-F1-C1 - Medical Expense Tax Credit
Examples of expenses that would be ineligible (because they increase home value or would be normally incurred by people without impairments) include the installation of hardwood flooring, a hot tub, or a pool.
2 November 2009 External T.I. 2009-0345491E5 F - Crédit d'impôt pour frais médicaux
CRA noted that example of expenses (if reasonable in amount) falling within s. 118.2(2)(l.2) included:
(a) the purchase and installation of interior or exterior ramps where stairs impede the mobility of a person with a disability;
(b) enlarging hallways and doors to allow the person with a disability access to different rooms in the dwelling
(c) lowering kitchen or bathroom counters to allow access by a person with a disability.
Respecting the expenses incurred by the taxpayer, CRA stated:
[W]e do not believe that expenses relating to the renovation of part of the existing roof, the addition of beams and the installation of asphalt shingles can give rise to the medical expense tax credit. With respect to the replacement and lowering of windows with sliding openings, such expenditures could potentially qualify … if the requirements set forth above are satisfied.
12 September 1995 External T.I. 9520655 - HOME RENOVATIONS AS A MEDICAL EXPENSE
Amounts paid in respect of the installation of a wheelchair lift to the second floor of an older home for the benefit of a disabled son, of extending the driveway in the back of the house where the lift is to be located, and dismantling the system of ramps currently in use (to the extent that such costs are necessary and integral to the other modifications), and of installing a bathroom suitable for his needs, would qualify.
6 June 1995 Internal T.I. 9502287 - HOME RENOVATIONS AS MEDICAL EXPENSES
The reasonable costs of constructing an addition to a house to accommodate the needs of a wheelchair-bound spouse are creditable.
20 April 1995 Internal T.I. 9509397 - MEDICAL EXPENSES
A proposed ground level addition to the taxpayer's residence necessitated by the second storey no longer being accessible to the taxpayer's disabled spouse, together with a related entrance and access ramp, would qualify for the credit.
5 June 1991 T.I. (Tax Window, No. 4, p. 27, ¶1280)
An air filtration system may qualify for a medical expense credit if it is prescribed by a qualified medical practitioner for a patient suffering from a chronic respiratory ailment, and a water purification device may so qualify if it is prescribed by a qualified medical practitioner for a patient suffering from severe chronic immune system disregulation.
Given the clear finding of fact made by the Tax Court judge that nothing linked tuition paid for the attendance of the taxpayer's child at nursery and elementary school and for swimming and ballet lessons to the child's speech and language problems, there was no basis for reversing a finding that the medical expense credit under s. 118.2(2)(e) (and under s. 118.2(2)(h)) was not available.
Paragraph 118.2(2)(l.21)
Administrative Policy
S1-F1-C1 - Medical Expense Tax Credit
An example of an eligible expense under the incremental cost approach is the amount by which the cost of a wide doorway exceeds what it would have cost to install an ordinary standard doorway (para. 1.98). CRA also states (at para. 1.99) that, although a patient's principal residence is a question of fact :
...CRA would not generally consider the dwelling of a patient's parents to be a dwelling of the patient or the patient's principal place of residence, for purposes of this provision, where the patient has year round use of his or her own apartment or house.
Paragraph 118.2(2)(l.7)
Administrative Policy
6 February 2008 Internal T.I. 2007-0249001I7 F - Crédit d'impôt-frais médicaux-Fourgonnette adaptée
A taxpayer has acquired a van-type recreational vehicle, equipped with sink, bed, toilet, shower and appliances, and a small trailer to transport his spouse's four-wheeler when travelling. The trailer in question was equipped with various devices to facilitate access, such as a motorized ramp, an anti-slip floor, and electric tilt, whose costs were reimbursed by a Quebec agency, and the taxpayer also claimed a medical expense credit for the cost of equipment installed in the van that was not so reimbursed, including a bed, an adapted toilet, a supplementary heating system, a solar panel and a battery. After finding that these items were not covered by Reg. 5700, the Directorate then concluded that they also did not generate a credit under s. 118.2(2)(l.7), stating:
[T]he provision does not apply to this situation because the van was not adapted for the purposes intended by the legislator. Indeed, the intention was to provide tax relief through the METC for the purchase and adaptation of a vehicle large enough - a van - to allow for the transportation of the patient, the patient’s wheelchair and patient’s family; something that a normal family vehicle would not have allowed. In this situation the trailer, rather than the van, was adapted with devices that are covered by the Act to allow the taxpayer's spouse to use a wheelchair.
Paragraph 118.2(2)(l.9)
See Also
Olney v. The Queen, 2014 DTC 1193 [at 3732], 2014 TCC 262 (Informal Procedure)
The taxpayer had been born under the effects of thalidomide, leaving her with virtually no arms and small hands with just three fingers. On the advice of her doctor, the taxpayer had a personal trainer to help her strengthen her core and leg muscles.
After finding that this qualified as "attendant care" (see summary under para. (b.1)) C Miller J found that the trainer was also therapy under s. 118.2(2)(l.9). The doctor would advise the taxpayer of appropriate treatment, which she would then relay to the trainer. Taking an expansive, compassionate view of para. (l.9), this could reasonably be construed as "general supervision."
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(b.1) | "attendant care" needs an "attendant" but otherwise is broadly construed | 170 |
| Tax Topics - Income Tax Act - Section 62 - Subsection 62(1) | scouting trip is not a moving expense | 33 |
Administrative Policy
28 March 2013 External T.I. 2012-0465171E5 F - Frais médicaux - technicien en orthophonie
After a physician’s referral, the taxpayer’s child (with a severe and prolonged impairment entitling the taxpayer to a credit for mental or physical impairment under s. 118.3) has been using the services of a speech-language pathologist in the private sector, who can only provide services to the child once every two weeks – so that for the other weeks, the child is seen by a specialized speech therapy technician to whom the child was referred by the speech-language pathologist.
In the course of finding that the taxpayer would not be entitled to claim the medical expense tax credit (the “METC”) respecting the fees of the technician, CRA stated:
Although the individual, in the particular situation, is entitled to claim an amount for persons with disabilities because of the individual’s child's disability, there is no indication that the services rendered by the speech therapy technician constitute a treatment that is both prescribed and administered under the general supervision of a medical doctor.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(a) | services of speech therapy technician ineligible | 150 |
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(o) | services of speech therapy technician did not assist in diagnosis | 162 |
S1-F1-C1 - Medical Expense Tax Credit
The requirement that the therapy be administered under the general supervision of a medical doctor, psychologist or occupational therapist is not considered to be met where the medical practitioner is merely monitoring a patient who is undergoing therapy.
Paragraph 118.2(2)(l.91)
Administrative Policy
29 February 2012 Internal T.I. 2011-0429701I7 F - Frais médicaux- services de tutorat
The taxpayer’s a daughter is permanently eligible for the disability tax credit because of her mental functioning. If the parent hires a full-time or part-time specialized educator with a mandate to stimulate the child in a structured setting and according to her needs in accordance with a specified educational program, would the educator’s salary qualify for purposes of the medical expense tax credit, and would a written statement from the doctor be required to certify that such child needs those services because of learning difficulties or mental impairment? CRA responded:
Although … the child appears to be eligible for the disability tax credit …we cannot confirm whether the services that would be offered by a specialized educator (by following the XXXXXXXXXX program or other program) would be tutoring services supplementary to primary education pursuant to paragraph 118.2(2)(1.91) and if a medical practitioner would certify that the child requires such services because of the child’s learning difficulties or mental impairment … based on the information received.
Paragraph 118.2(2)(m)
Administrative Policy
S1-F1-C1 - Medical Expense Tax Credit
Reasonable servicing and repair costs related to a device or piece of equipment listed under Reg. 5700 will generally be eligible for an METC.
Paragraph 118.2(2)(n)
Cases
Ali v. Canada, 2008 DTC 6446, 2008 FCA 190
The Court denied the taxpayers' claim for medical expense tax credits from the purchase of herbs, vitamins and supplements, given that s. 118.2(2)(n) clearly does not include "over the counter" drugs. Ryer J.A. stated (at para. 17):
With respect to the legislative scheme at issue in this case, the definition of "medical expense" in subsection 118.2(2) of the ITA contains an enumeration of the specific types of costs that are eligible for the METC. This indicates a legislative purpose of limiting the availability of the METC to a specific list of items. Paragraph 118.2(2)(n) of the ITA exemplifies this purpose by drawing a line between items that meet the "recorded by a pharmacist" requirement and those that do not.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Other Legislation/Constitution - Charter (Constitution Act, 1982) - Subsection 15(1) | no discrimination denying tax credits for drugs that were obtainable without a prescription | 126 |
Ray v. Canada, 2004 DTC 6028, 2004 FCA 1
The Tax Court had erred in finding that vitamins, herbs and organic foods that had been prescribed by a physician and purchased off the shelf by the taxpayer qualified and that the words "recorded by a pharmacist" should be ignored. Sharlow J.A. stated (at p. 6031) that "it is reasonable to infer that the recording requirement in paragraph 118.2(2)(n) is intended to ensure that tax relief is not available for the cost of medications purchased off the shelf" and that she could not "accept the suggestion that, in the case of a medication that is prescribed by a physician but is purchased at a pharmacy off the shelf, a sales slip or invoice from the pharmacist would be a sufficient 'recording' to meet the statutory requirement".
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Statutory Interpretation - Redundancy/reading in words | 48 | |
| Tax Topics - Other Legislation/Constitution - Federal - Tax Court of Canada Act - Section 18.24 | 66 |
Dunn v. Canada, 2003 DTC 5030, 2002 FCA 506
The taxpayer was not entitled to a credit for drugs that were prescribed by her physician, dentist and naturopath and that were not available through regular pharmacies or other medical supply sources (so that they did not qualify as being "recorded by a pharmacist").
See Also
Leeper v. The Queen, 2015 DTC 1115 [at 733], 2015 TCC 82 (Informal Procedure)
Paris J denied the taxpayer's claim for a medical expense tax credit relating to the purchase of natural health products including vitamins, minerals, herbs and naturopathic supplements to treat his wife's cancer. None of these items were available only by perscription, as required in s. 118(2)(n).
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Other Legislation/Constitution - Charter (Constitution Act, 1982) - Subsection 15(1) | non-creditability of natural cancer remedies not discriminatory | 59 |
| Tax Topics - Other Legislation/Constitution - Charter (Constitution Act, 1982) - Section 7 | unavailability of tax credit for natural cancer remedies did not infringe the taxpayer's s. 7 rights | 54 |
Berg v. The Queen, 2012 DTC 1017 [at 2564], 2011 TCC 528 (Informal Procedure)
The taxpayer was not allowed to deduct the cost of over-the-counter supplements to alleviate her fibromyalgia, chronic fatigue syndrome, and polymyalgia rheumatica, because the supplements were not prescribed. She was also unable to deduct supplements bought before the 2008 amendment to paragraph (n) (which established the requirement prescriptions had to be made by a medical professional or dentist or pursuant to regulation) because there was not a prescription recorded by a pharmacist.
Tall v. The Queen, 2009 DTC 187, 2008 TCC 677 (Informal Procedure)
V.A. Miller, J. followed the decision in Ali v. The Queen, 2008 DTC 6446, 2008 FCA 190 in finding that the "recorded by a pharmacist" requirement in s. 118.2(2)(n) did not violate the equality rights guaranteed by s. 15 of the Charter as this paragraph did not make a distinction based on personal characteristics.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Other Legislation/Constitution - Charter (Constitution Act, 1982) - Subsection 15(1) | 54 |
Breger v. The Queen, 2007 DTC 1156, 2007 TCC 254 (Informal Procedure)
The taxpayer was a qualified medical doctor who prescribed various vitamins and herbs for his wife to take, who had severe ailments, with such prescriptions being filled by a licensed pharmacist who then issued official receipts. Such expenditures qualified under s. 118.2(2)(n), notwithstanding that the vitamins and herbs could have been purchased over the counter without the participation of the pharmacist, given that the Quebec Pharmacy Act regime required that any prescriptions that were filled by a pharmacist were to be recorded. McArthur J. stated (at para. 18):
"From my reading of the provision, eligibility under paragraph 118.2(2)(n) of the Act is determined not by the classification of the medication but by the execution of certain actions by the authorized professionals who control the access to that medication."
Administrative Policy
2 December 2010 External T.I. 2010-0386581E5 F - CIFM - Traitement pour problème de peau
Regarding a drug prescribed by a dermatologist and recorded by a pharmacist, CRA stated:
[T]he expenses incurred by the taxpayer to purchase a drug to treat a rare form of skin condition and itching of the scalp would fall within paragraph 118.2(2)(n) and consequently qualify for the METC.
Paragraph 118.2(2)(o)
See Also
CHEN v. The Queen, 2019 TCC 192 (Informal Procedure)
The taxpayer had stem cells harvested from the umbilical cord when she was delivered of her second son, which she claimed occurred on the verbal advice of the obstetrician that this was advisable due to the father’s Type 1 diabetes and the correspondingly higher risk of the child contracting diabetes than the general population. The Minister disallowed the taxpayer’s medical expense tax credit of $5,720 for the procedure. The family doctor provided a very brief letter 17 months after the delivery of the child that noted that the stem cells were being stored for future use, and stating “All patients are advised to do this, if possible, from birth." The obstetrician did not testify or provide clinical notes.
Bocock J stated (at para 7) that for s. 118.2(2)(o) to apply, the expense must be:
(a) for a laboratory, radiology or diagnostic activity;
(b) undertaken to maintain health, prevent disease or diagnose or treat injury, illness or disability;
(c) for the patient; and
(d) all as prescribed by a medical practitioner.
After finding that, consistently with Shapiro, that the harvesting and storage of stem cell blood from a newborn satisfies the first three elements, Bocock J dismissed the appeal, finding that the fourth element was not satisfied, stating (at paras 13 and 14):
… The letter suggests something akin to good standard health practices. It does not reference or connect the procedure as a treatment of the illness through a prescribed course of action by that medical practitioner, but endorses after the fact, the taxpayer’s decision.
From the perspective of common sense and Shapiro, best practices are not captured within the ambit of paragraph 118.2(2)(o). The provision creates a deduction for … present and future ailments. It is not intended to create a deduction for generic and undiagnosed population-wide illness and disease. The 2017 letter …, some 17 months after the procedure and its language, descriptive rather than directive, cannot provide evidence of a medical prescription undertaken by the Appellant in 2016.
Shapiro v. The Queen, 2014 DTC 1080 [at 3080], 2014 TCC 74 (Informal Procedure)
The Minister denied the taxpayer's claim for medical expense tax credits for storing her child's cord blood. Based on the wording of s. 118.2(2)(o), such expenses must be:
(a) in respect of a laboratory, radiological or other diagnostic procedure or service together with necessary in interpretations;
(b) for maintaining health, preventing disease or assisting in the diagnosis or treatment of any injury, illness or disability;
(c) for the patient; and
(d) as prescribed by a medical practitioner.
Hogan J dismissed the taxpayer's appeal, as the last requirement had not been met; he noted, however, that the first three had. In particular, the taxpayer and her child were "patients" for the purpose of the third requirement, as the French version does not suggest that the patient need suffer from any illness during the years in question (para. 14).
Administrative Policy
28 March 2013 External T.I. 2012-0465171E5 F - Frais médicaux - technicien en orthophonie
After a physician’s referral, the taxpayer’s child (with a severe and prolonged impairment entitling the taxpayer to a credit for mental or physical impairment under s. 118.3) has been using the services of a speech-language pathologist in the private sector, who can only provide services to the child once every two weeks – so that for the other weeks, the child is seen by a specialized speech therapy technician to whom the child was referred by the speech-language pathologist.
In the course of finding that the taxpayer would not be entitled to claim the medical expense tax credit (the “METC”) respecting the fees of the technician on other grounds as well, CRA stated:
[T]he fees paid to a speech therapy technician are not eligible for the purposes of the METC because their actions do not assist the medical doctor (or the speech-language pathologist, in this case) to diagnose or to establish medical treatment.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(a) | services of speech therapy technician ineligible | 150 |
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(l.9) | services of speech therapy technician, who supplemented speech-language pathologist’s services, were ineligible as being unsupervised by a doctor | 170 |
S1-F1-C1 - Medical Expense Tax Credit
CRA provides examples of expenses involved with artificial insemination that may fall under s. 118.2(2)(o) (para. 1.130).
Some costs associated with procedures are treatments are ineligible because they are not laboratory, radiological or other diagnostic procedures or services, but may fall under another paragraph. CRA provides examples (para. 1.131).
15 November 2012 External T.I. 2012-0456201E5 F - Frais médicaux - calcul et dépenses non admissibles
In finding that the expenses of telemonitoring individuals in order to provide an emergency call service that is activated by a bracelet or a pendant – as well as the related expenses of purchasing or renting a tracking device and the associated user fees - were not eligible for the medical expenses tax credit ("METC") under s. 118.2(2)(m) or (o) or any other provision, CRA stated:
[O]nly expenses paid for a specific laboratory, radiology or other diagnostic procedure may qualify as medical expenses, if that procedure was done on the order of a physician. We are of the view that the expenses paid for the goods or services described in your first question are not directly attributable to a specific medical service rendered to an individual, but rather are paid for the availability of those services. whether or not they are actually used by the individual.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Regulations - Regulation 5700 - Section 5700 - Paragraph 5700(e) | non-custom shoes would not qualify | 118 |
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(1) | expenses that were incurred, paid for and receipted within same 12-month period cannot be deferred | 193 |
11 February 2011 External T.I. 2010-0386651E5 F - Admissibilité - Frais médicaux
In response to a query of the manager of a health care spending account as to whether an expenditure qualified under s. 118.2(2), CRA stated:
[T]he procedures set out in paragraph 118.2(2)(o) must assist the health professional in diagnosing or establishing medical treatment. Consequently, we are of the view that the pathology expenses paid to a physician were incurred for the purpose of maintaining health, preventing disease and diagnosing or treating an injury, illness or disability and are, as such, come within subsection 118.2(2).
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(a) | preliminary report of genetic counsellor would not qualify | 102 |
1 February 2011 External T.I. 2010-0386621E5 F - Prélèvement et conservation de cellules souches
In indicating that the expenses associated with harvesting and storing stem cells are ineligible for the credit, CRA stated:
[T]he services referred to in paragraph 118.2(2)(o) must assist the health professional in diagnosing or establishing medical treatment. In your situation, the collection and storage of stem cells can be used to treat a number of diseases. Therefore, we do not consider the collection and storage of these stem cells to be an act for the maintaining of health, preventing disease or assisting in the diagnosis or treatment of any injury, illness or disability.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(a) | stem cell harvesting and storage costs ineligible as not relating to an existing medical condition | 71 |
Paragraph 118.2(2)(q)
Administrative Policy
30 July 2014 Internal T.I. 2014-0524321I7 - New Brunswick Drug Plan- Premiums
"[P]remiums paid to the NBDP [New Brunswick Drug Plan] are qualifying medical expenses pursuant to paragraph 118.2(2)(q)… ."
6 October 2006 Roundtable, 2006-0197131C6 F - Police soins de longue durée
Insurers offer long term care policies which provide binding coverage for residential care (under which a daily benefit is provided in the event of a prolonged stay in a long-term care facility that is in a fixed amount, irrespective of the actual costs paid to the facility) and optional coverage (under which the cost of medically necessary health care recommended by a doctor and provided by a nurse is reimbursed). Are the premiums deductible under s. 118.2(2)(q)? CRA responded:
IT-339R2 [para. 4) … states that coverage under a plan must be in respect of hospital care or expense or medical care or expense which normally would otherwise have qualified as a medical expense under the provisions of subsection 118.2(2) … . Secondly, the premium paid by a taxpayer pursuant to a private health insurance plan must have been paid in respect of the taxpayer or a person related to the taxpayer and living in the taxpayer's home.
Consequently, we are of the view that a premium paid by an individual for a long-term care policy of the "Optional coverage: Home care" type may qualify as a medical expense if all the conditions of paragraph 118.2(2)(q) are satisfied. That qualification is a question of fact.
However ... premiums paid by an individual for a long-term care policy under a "Binding coverage: Residential care" would not be considered premiums paid under a private health services plan and would not qualify as medical expenses giving rise to a non-refundable tax credit.
Finally … where the policy includes both coverages, it is our view that the policy would not be a private health services plan and therefore the premiums would not qualify as medical expenses giving rise to a non-refundable tax credit.
Subsection 118.2(2.1) - Cosmetic purposes
Administrative Policy
17 November 2011 External T.I. 2011-0414811E5 F - Frais médicaux- fins esthétiques
The correspondent, who underwent mammoplasty to reduce her right breast, that was covered by her provincial health care plan, at the same time incurred personally the cost of mammoplasty of her left breast. In the course of a general discussion, CRA indicated that examples of eligible expenses included those of surgery to address a deformity related to a congenital abnormality, a personal injury resulting from an accident or trauma, or a disfiguring disease, and breast implants and related reconstructive procedures after mastectomy and breast reduction to reduce back and shoulder pain.
S1-F1-C1 - Medical Expense Tax Credit
Procedures that would generally be considered to have a medical or reconstructive purpose include those that would ameliorate a deformity arising from, or directly related to, a congenital abnormality, a personal injury resulting from an accident or trauma, or a disfiguring disease. Some common procedures, which are not disallowed by subsection 118.2(2.1) are:
- breast implant and related procedures for reconstructive purposes after a mastectomy;
- hair removal, in limited circumstances, such as for persons with polycystic ovarian syndrome; and
- removal of excess skin after rapid weight loss due to a risk of infection.
Common procedures the costs of which are generally not considered to be eligible medical expenses because of the application of subsection 118.2(2.1) include:
- augmentations (such as chin, cheek, lips);
- filler injections (for removal of wrinkles);
- liposuction; and
- teeth whitening.
16 April 2013 External T.I. 2013-0480831E5 F - Frais médicaux - chirurgie esthétique
Following bariatric surgery and resulting significant weight loss, would costs incurred for cosmetic surgery to remove excess skin qualify? CRA responded:
[C]osts incurred for skin removal after rapid weight loss may be eligible for the purposes of the METC to the extent that such costs are medically required.
25 September 2012 External T.I. 2012-0463201E5 - medical expenses - sex reassignment surgery
In response to a question as to whether the costs of sex change surgery and related transportation costs would qualify for the medical expense credit, CRA stated:
the cost of the Sexual Reassignment surgery, Chondrolaryngoplasty, facial feminization surgery, recovery clinic and laser hair removal would likely qualify as medical expenses for purposes of the METC if the requirements of paragraph 118.2(2)(a) are met. In addition, it is also our view that travel costs would also likely qualify as medical expenses for purposes of the METC as long as the requirements set out above for paragraphs 118.2(2)(g) and (h) are met.
13 March 2012 External T.I. 2012-0433661E5 F - Notion de dépense engagée
Cosmetic surgery is ineligible for the medical expense tax credit where the expense was “incurred” after March 4, 2010. In commenting on the meaning of “incurred,” CRA stated:
… Wawang … stated:
[T]he correct question to ask, in determining whether a legal obligation is contingent at a particular point in time, is whether the legal obligation has come into existence at that time, or whether no obligation will come into existence until the occurrence of an event that may not occur.
We believe that the comments made on the concepts of "outlay or expense incurred" under paragraph 18(1)(a) can apply to expenses incurred for the purposes of the medical expense tax credit.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 18 - Subsection 18(1) - Paragraph 18(1)(a) - Incurring of Expense | expense not incurred if obligation therefor dependent on future contingency | 97 |
Subsection 118.2(3) - Deemed medical expense
Paragraph 118.2(3)(b)
Administrative Policy
11 August 2015 External T.I. 2014-0527291E5 F - Remboursement de frais médicaux-CIMAD
2013-0490901I7 reversed 2001-0113237 in finding that the Ontario Healthy Homes Renovation Tax Credit would not be considered a "reimbursement" for purposes of s. 118.2(3)(b). What about the Québec refundable tax credits could be considered as a "reimbursement" of medical expenses for purposes of paragraph 118.2(3)(b), in particular, the Tax Credit for Home-Support Services for Seniors ("CIMAD"), the Independent Living Tax Credit for Seniors ("CIALB") and the Rehabilitation Centre Tax Credit ("CISUT") – and may an individual who has treated a CIMAD as a medical expense for such purposes amend their tax returns for the last 10 years to adjust the calculation of the Medical Expenses Tax Credit ("METC")?
CRA stated:
[T]he CIMAD, CIALB and CISUT would not generally be considered a "reimbursement" for purposes of paragraph 118.2(3)(b) in a situation where an expense that is eligible for any of these credits is also an eligible expense for the METC. These credits would not reduce the amount of eligible medical expenses for the METC. …
[A]n individual who has already filed tax returns for the tax years 2013 and 2014 and treated a CIMAD as a medical expense reimbursement for purposes of paragraph 118.2(3)(b), may obtain, within the normal reassessment period, a correction for a tax return already filed for those years.
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 152 - Subsection 152(1) | correction in CRA position not applied on a retroactive basis | 138 |
2014 Ruling 2013-0514561R3 - Payment in lieu of continued PHSP coverage
Before ruling that lump sum payments, made under a CCAA plan to former employees in settlement of their claims respecting private health services plans of which they had been beneficiaries, were non-taxable to them, CRA noted that the plan beneficiaries would be advised by the court-appointed counsel acting on their behalf that "that for purposes of calculating the non-refundable medical expense tax credit under section 118.2, neither [they] nor their spouse or common-law partner can include any amounts that would otherwise be qualifying medical expenses until such time as their cumulative medical expenses incurred since the termination of the Plans exceed the amount of the Payment received."
See summary under s. 6(1)(a).
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 6 - Subsection 6(1) - Paragraph 6(1)(a) | lump sum settlements of CCAA claims under private health services plans were non-taxable | 279 |
19 August 2013 Internal T.I. 2013-0490901I7 - medical expense tax credit
CRA indicated that upon review it had concluded that the refundable Ontario Healthy Homes Renovation Tax Credit (OHHRTC):
will not be considered to be a reimbursement for the purpose of paragraph 118.2(3)(b) of the Act. Consequently, medical expenses eligible for the medical expense tax credit will not be reduced by the OHHRTC
8 July 2013 Internal T.I. 2012-0472651I7 F - Crédit pour l'embauche par les petites entreprises
A taxpayer who does not carry on a business and who hires and remunerates employees including a home care worker, and deducts source deductions and files T4 slips as required thereby generates the small business job credit ("SBJC"). The Directorate stated:
[P]aragraph 118.2(3)(b) generally provides that an individual must not treat as eligible medical expenses the expenses for which the individual is entitled to be reimbursed. An exception to this rule is where the amount of the reimbursement is required to be included in computing income and is not deductible in computing taxable income. Considering that the Act does not define the term "reimbursement", we are of the view that the SBJC amount could be considered a reimbursement for the purposes of paragraph 118.2(3)(b).
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 9 - Exempt Receipts/Business | small business job credit received for payroll of non-business employees, exempt | 109 |
| Tax Topics - Income Tax Act - Section 118.2 - Subsection 118.2(2) - Paragraph 118.2(2)(b.1) | single service does not qualify as attendant care | 74 |
May 2013 ICAA Roundtable, Q. 18 (reported in April 2014 Member Advisory)
Will CRA disallow expenses which are reimbursable but which have not been reimbursed? CRA responded:
By using "entitled" to be reimbursed for the expense, the Act precludes the inclusion of amounts that could be reimbursed through an insurance plan and not only the ones that have been reimbursed. … For this reason, one is to assume that the expenses would need to be submitted to the insurance company before the amount can be considered by the Canada Revenue Agency….
27 January 2012 Internal T.I. 2011-0428831I7 F - Crédit d'impôt pour frais médicaux
The taxpayer was reimbursed by the Régie de l'assurance-maladie du Québec ("RAMQ") for drug costs incurred in 2007 through 2011, but in 2011, was required to reimburse the amounts paid by the RAMQ for those years since the taxpayer was also covered under a private plan. The taxpayer was only reimbursed by the private insurer for 2010 and 2011 because the deadlines for submitting claims had passed. CRA stated:
Paragraph 118.2(3)(b) provides that qualifying medical expenses of an individual do not include any expense for which the individual, the patient or the legal representative of either such person has been, or is entitled to be, reimbursed except to the extent that the amount is required to be included in income and cannot be deducted in computing taxable income. …
[T]he taxpayer could claim the METC for the medical expenses incurred in 2007, 2008 and 2009 in that the taxpayer no longer has the right to be reimbursed for these expenses as part of the group drug insurance plan. Since the METC must be claimed for medical expenses paid in the year, the taxpayer should make an application to the Minister of National Revenue pursuant to subsection 152(4.2).
| Locations of other summaries | Wordcount | |
|---|---|---|
| Tax Topics - Income Tax Act - Section 152 - Subsection 152(4.2) | application under s. 152(4.2) for drug claim deductions that later emerged | 137 |