Medical Expenses Tax Offset

If you reach a prescribed level of expenses for medical treatment for the year, you can claim a tax offset in that years tax return.

For the 2002/03 and subsequent financial years, the medical expenses tax offset is calculated as 20% of your net medical expenses over the threshold of $1,500.

Net medical expenses are the medical expenses you have paid less any refunds from Medicare or a private health fund.

Medical expenses relating to the following people qualify:

1. You
2. Your spouse [including de facto]
3. Your children
4. Any other child under 16 - not a student - who you maintained (subject to income tests)
5. A student under 25 years who you maintained (subject to income tests)
6. A child-housekeeper
7. An invalid relative, parent or spouse's parent.

Claimable medical expenses include payments relating to:

1. Illnesses or operations - paid to legally qualified doctors, nurses or chemists
2. Hospitals and nursing homes
3. Dental treatment
4. Optical treatment
5. Therapeutic treatment - at the direction of a doctor
6. Medical or surgical wigs
7. Guide dogs
8. Artificial limbs, surgical appliances, etc
9. Carers
10. Medical aids - prescribed by a doctor

Non-claimable medical expenses include:

1. Ambulance charges and subscriptions
2. Private health fund subscriptions
3. Funeral expenses
4. Non-prescribed vitamins and health foods
5. Inoculations and vaccinations.

If you are unsure if this affects you, please contact your accountant.