Revenue Tax Briefing

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Revenue Tax Briefing Issue 33, September 1998

Health Expenses - Guidelines & Procedures on Claims

Qualifying Expenses

Introduction

This article sets out the guidelines and procedures in relation to health expenses claims under Section 469 TCA 1997. It outlines various categories of expenses and addresses many of the issues and queries that arise from time to time. The items included are:

  • Services of a practitioner
  • Diagnostic procedures
  • Physiotherapy or similar treatment
  • Orthoptic or similar treatment
  • Hospitals
  • Drugs and medicines
  • Appliances
  • Home Nursing and Special Nursing
  • Kidney Patients
  • Child Oncology Patients
  • Coeliac Patients
  • In Vitro Fertilisation
  • Travelling and Accommodation
  • Dental Treatment

General information on claims

Claim forms

Form Med 1 (Health Expenses Relief claim form) has been re-designed and contains revised procedures regarding submission of receipts. Receipts need not be submitted to the tax office with the form Med 1. They should be retained for a period of six years and need only be submitted if the claim is chosen for detailed examination and the receipts are specifically requested by the tax office.

If the claim includes dental expenses Form Med 2 should be submitted with the form Med 1.

Processing of health expenses claims

Subject to a “credibility” check, claims for health expenses are accepted and processed on the basis of the figures shown on the form Med 1. However, where it seems from the “credibility” check that the claim is not in accordance with the taxpayer’s circumstances (e.g. a claim for medical insurance relief has been made but there is no deduction for a refund by the insurers in respect of insurable items) the claim will not be processed and the taxpayer will be consulted to clarify the claim. A taxpayer who knowingly makes a false statement for the purpose of obtaining a repayment of tax will be liable to heavy penalties.

Confidential service

If a health expenses claim comes up for examination under an audit programme the taxpayer has the option of having the claim examined by a different tax office. This option only arises where the taxpayer does not want his/her own tax office to know the nature of the medical condition.

Advance allowance of relief in cases of hardship

The statutory requirement that relief is to be given by way of repayment only may be modified in practice in cases of hardship to allow tax relief during the tax year. All such cases will, of course, be subject to lodgment of claim form Med 1 in the normal way, and to review after the end of the tax year.

Treatment of damages

Section 469(3)(c) TCA 1997 provides that expenses are not regarded as having been defrayed by the individual insofar as they are recouped in any way, by the individual or by any dependant of the individual from a public or local authority or under a contract of insurance or by way of compensation or otherwise.

Where a person receives damages for personal injury, the amount awarded may cover a variety of items including medical expenses. The medical expenses involved may comprise:

  • A specific award for known expenses
  • A lump sum award to cover potential expenses.

Generally, a specific award will be vouched amounts incurred before the award is made. A lump sum will not be related to specific expenses but will be given in anticipation of the claimant having to incur medical expenses in the future on account of his/her injury.

In dealing with claims for medical expenses no relief is given in so far as the expenses are covered by a specific award. Usually a lump sum award will be invested and the expenses paid out of the income generated by the investment. Medical expenses other than those covered by a specific award are treated as being paid primarily out of the claimant’s income (from whatever source) and accordingly a medical expenses claim in respect of expenses incurred after the date of the award, and which are not covered by a specific award, would not be restricted on account of a lump sum award.

Items of Expense

Services of a practitioner

The meaning of “practitioner” for the purposes of health expenses relief is set out in Section 469(1). In most cases the question of whether or not a practitioner may be regarded as a qualifying practitioner would not give rise to difficulty. Cases of difficulty should be referred to the tax office.

Diagnostic procedures carried out on the advice of a practitioner
Physiotherapy or similar treatment prescribed by a practitioner
Orthoptic or similar treatment prescribed by a practitioner

Claims for relief in respect of such procedures or treatments, which are carried out by persons who are not to be regarded as “qualifying practitioners” should be accompanied by a medical certificate which outlines the patient’s illness or complaint and confirms that the patient was referred by his/her doctor to the person providing the treatment. Where the expenditure incurred comes within the above headings, relief may be allowed in respect of the procedures or treatments carried out but not for drugs, medicines, lotions or potions etc., prescribed by the person providing the treatment. Examples of allowable treatment under the heading physiotherapy include treatment by chiropractors, osteopaths and bone-setters. Accupuncture treatment is not allowable.

Hospitals

Only payments in respect of maintenance and treatment in establishments which may be regarded as “hospitals” within the meaning of Section 469 TCA 1997 qualify for relief. A list of approved hospitals is available from any tax office or from the Revenue Forms & Leaflets Service at 01 - 878 0100. It is also available on Revenue’s Internet site - (www.revenue.ie/download/apphos.doc).

If there is any doubt that an institution is a “hospital” then the tax office can be consulted.

Drugs and medicines supplied on the prescription of a practitioner

Only drugs and medicines supplied by a pharmacist, on prescription from a medical practitioner qualify for relief. (However, see paragraph on coeliac patients)

Appliances

Where there is any doubt as to whether or not an appliance is a medical, surgical, dental or nursing appliance, a certificate from a medical practitioner should be submitted which:

  • States the nature of the patient’s illness
  • Confirms that the appliance is being used on the advice of the medical practitioner
  • Outlines how the appliance will help to prevent, diagnose, alleviate or treat the ailment, injury, infirmity, defect or disability from which the patient is suffering.

The claim will be considered in the light of the information submitted and relief given where the Inspector is satisfied that the appliance may be regarded as a medical, surgical, dental or nursing appliance. Examples of decisions already taken in regard to certain appliances are set out on Page 16.

Home nursing

In cases of serious illness where qualified nurses are engaged on the advice of a medical practitioner to provide constant nursing care in the patient’s home, relief under Section 469 TCA 1997 may be allowed where the following conditions are satisfied:

  • A medical certificate is provided which:
    • Shows the nature of the patient’s illness
    • States that constant nursing care by fully-qualified nurses in the patient’s home is required
    • Covers the full period for which home nursing is being claimed.
  • The nurses providing the nursing care are fully qualified and their full names, addresses and qualifications have been supplied
  • Receipts are provided in respect of all payments to the nurses and, where necessary, a breakdown of the payments is provided. This is to ensure that relief is given only in respect of the amounts paid which directly relate to the rendering of nursing care.

Special nursing

Where the claimant is a patient in a hospital or nursing home, relief under Section 469 TCA 1997 may also be allowed in respect of payments made to qualified nurses to provide additional nursing care over and above that ordinarily provided by the institution if:

  • The last two conditions outlined above for “Home Nursing” are satisfied
  • A medical certificate is submitted which:
    • Shows the nature of the patient’s illness
    • States that constant nursing care over and above that ordinarily provided in the institution is required, indicating the necessity for such additional care
    • Covers the full period for which the nursing care is being claimed.

Kidney patients

Relief under Section 469 TCA 1997 is granted under specific headings in respect of certain expenses incurred by kidney patients as follows:

  • Hospital dialysis (where the patient attends hospital for treatment)
  • Home dialysis (where the patient uses a dialysis machine at home)
  • Chronic Ambulatory Peritoneal Dialysis - “CAPD” (where the patient has treatment at home without the use of a dialysis machine).

Hospital dialysis patients

Expenses incurred in travelling to and from hospital for treatment are allowed on the basis of the Civil Service Point-to-Point Rate (reduced mileage rate) for a 10/12 H.P. car. The claimant should specify the number of trips undertaken and the mileage involved. (See Page 15 for rates).

Home dialysis patients

Relief may be allowed under the following headings and at the rates shown on Page 15:

  • Electricity
  • Laundry and Protective Clothing
  • Telephone
  • Travelling

Qualifying mileage at the appropriate rate per mile for each year subject to a maximum of 25 trips per annum. The claimant should specify the number of trips and the mileage involved.

CAPD patients

Relief may be allowed under the following headings and at the rates shown on Page 16:

  • Electricity
  • Telephone
  • Travelling
    Qualifying mileage at the appropriate rate per mile subject to a maximum of 25 trips per annum. The claimant should specify the number of trips and the mileage involved.

When a claim from a kidney patient is being considered, it is necessary to establish the appropriate category. It is, of course, possible for a patient to move from one category to another. Where a change takes place during the course of a year, relief for each category is apportioned as appropriate.

Oncology units

The Oncology Units in childrens’ hospitals are concerned with the care and treatment of children with cancer or other diseases of the blood/marrow [e.g. severe anaemia].

Child oncology patients

The following expenditure - in respect of child oncology patients only qualifies for relief:

  • Travel
    The cost incurred in travelling [unlimited journeys] to and from hospital oncology units in respect of:
    • The patient and accompanying parents/guardians, and
    • Parents/guardians of the patients where such trips are shown to be essential to the treatment of the child.

If a private car is used, 22.09 pence per mile may be allowed for years up to and including 1996/97 and 25 pence per mile for 1997/98 onwards.

  • Telephone
    Where the child is being treated at home, the telephone costs incurred for purposes directly connected with the treatment of the child.
  • Overnight Accommodation
    Payments made by the parents/guardians to the hospital in which the child is being treated where the cost of such accommodation is necessarily incurred in connection with the treatment of the child.
  • Hygiene products and special clothing
    The cost incurred in respect of these items [subject to a total maximum of ₤300 per annum]

Note

Claims in respect of the cost of minding brothers/sisters of the patient while the parents/guardians attend the hospital are not allowable.

Coeliac patients

Relief in respect of the cost of gluten-free food for coeliacs is an allowable expense for the purposes of a health expenses claim.

As the condition is generally ongoing, a letter [instead of prescriptions] from a doctor stating that the taxpayer is a coeliac sufferer is acceptable.

If receipts are requested such receipts are not confined to those from a chemist - receipts from supermarkets, etc., in respect of such qualifying expenses are also acceptable.

Travelling and accommodation

Relief in respect of transport expenses is restricted to expenses of transport by ambulance. However, see notes earlier on health expenses for kidney patients and child oncology patients.

Travelling and accommodation expenses within the State are not normally allowed. Where, however, regular continuing treatment or consultation is required and the patient has to travel long distances the expenses may be admitted. It is not the intention that minor local travelling expenses or occasional travelling, e.g. to undergo an operation (unless by ambulance) be admitted.

Where qualifying health care is obtainable only outside the State reasonable expenses of travelling and accommodation for the patient may be allowed. In such cases the expenses of one person accompanying the patient may also be allowed where the condition of the patient requires it.

Where the patient is a child the expenses of one parent may generally be allowed and, exceptionally, of both parents where it is clear that both have to be in attendance.

In-Vitro Fertilisation

For the purposes of Section 469 TCA 1997 “In-Vitro Fertilisation” is regarded as treatment in respect of infertility and relief is allowed in respect of the cost of same. However, if the treatment results in a pregnancy, the cost of routine maternity care received by the woman in the course of the pregnancy would not be allowed.

Dental Treatment

The legislation specifically excludes relief for expenditure incurred on the extraction, scaling and filling of teeth and the provision and repairing of artificial teeth or dentures. These items are excluded from relief even if there is an underlying medical condition giving rise to the dental treatment, or if the treatment in a particular case is considered to be of a non-routine nature.

Treatment for which relief is claimed will be considered in the light of the above exclusion i.e. relief for the cost of any work carried out may not be allowed where the treatment is the extraction, scaling or filling of teeth. etc. If, however, the treatment is (for example) of an orthodontic nature, involving the extraction of a tooth as part of that treatment, relief would be allowed for the cost of the orthodontic treatment excluding the cost of the extraction. An exception to this rule is the cost, of the surgical extraction of impacted wisdom teeth undertaken in hospital, which is allowable.

The surgical removal of impacted teeth carried out in a hospital is not regarded as “routine dental treatment” within the meaning of Section 469 TCA 1997. Relief is therefore allowed for the cost of such surgical removals. It is not allowed where the work is carried out by a dentist in a dental surgery.

Note

An impacted tooth is one which is so firmly lodged in its socket that it cannot emerge through the gum in the normal way. The impaction may be caused by an overlying bone, or because the tooth has grown in such a way that it has become wedged in against another tooth.

Claims for non-routine dental treatment

Claims relief on Form MED 1 for non-routine dental treatment must be accompanied by a certificate on Form MED 2 (Dental). The possession of this certificate does not guarantee the availability of tax relief for the costs of all or any of the treatment shown. A list of treatments for which relief may be allowed is included below.

Kidney Patients

Hospital dialysis patients (where the patient attends hospital for treatment)

Relief in respect of expenditure incurred travelling to and from hospital (unlimited journeys) may be allowed at the following rates:

1990/91 to 1996/97

22.09p per mile

1997/98

25p per mile

Home dialysis patients (where the patient uses a dialysis machine at home)

Relief may be allowed in respect of expenditure up to the following amounts:

94/95

95/96

96/97

97/98

Electricity

₤800

₤800

₤820

₤830

Laundry/Protective Clothing

₤900

₤925

₤935

₤950

Telephone

₤70

₤70

₤70

₤70

Travelling [pence per mile]

24.9

24.9

24.9

25.0

[subject to a max. 25 trips per annum.]

Chronic Ambulatory Peritoneal Dialysis (CAPD) patients (where the patient has treatment at home without the use of a dialysis machine)

Relief may be allowed in respect of expenditure incurred up to the following amounts:

94/95

95/96

96/97

97/98

Electricity

₤630

₤630

₤650

₤660

Telephone

₤70

₤70

₤70

₤70

Travelling [pence per mile]

22.09

22.09

22.09

25.0

[subject to a max. 25 trips per annum.]

Note: It is possible for a patient to move from one category to another. Where this happens, relief for each category may be apportioned as appropriate.

Appliances for which tax relief is allowable

Gluocmeter Machine

The cost of the provision of a glucometer machine on the advice of a medical practitioner for a diabetic.

Hearing Aid

The cost of the provision of a hearing aid on the advice of a medical practitioner.

Orthopaedic Bed/Chair

Where the patient is suffering from a specific illness or disability the cost of the provision of an orthopaedic bed or chair, on the advice of a medical practitioner, is allowed.

Wheelchair/Wheelchair Lift

Expenses incurred in the provision of a wheelchair or wheelchair lift for a disabled person, on the advice of a medical practitioner, are allowable, but no relief is due for alteration to the building to facilitate a lift.

Exercise Bicycle

Where medical evidence indicates that same is necessary the cost may be allowed.

Computer

Where medical evidence is produced that same is necessary to alleviate communication problems of a severely handicapped person, the cost may be allowed.

False Eye

The cost of a false eye is regarded as an expense incurred on the purchase of a medical appliance.

Appliances for which tax relief is not allowable

Car (for disabled person)

The provision of a specially adapted car for a disabled person is not allowable.

Construction Work

The cost of structural alterations or improvements to a private residence to facilitate an incapacitated person is not allowable.

Telephone

The installation of a telephone, the rental of same or the cost of calls, (except in the case of certain categories of kidney patients), is not allowable.

Dental Treatments for which tax relief is allowable

Crowns

These are restorations fabricated outside the mouth and are permanently cemented to existing tooth tissue.

Veneers/Rembrant Type Etched Fillings

These are a form of crown.

Tip Replacing

This is regarded as a crown where a large part of the tooth needs to be replaced and the replacement is made outside the mouth.

Gold Posts

These are inserts in the nerve canal of a tooth, to hold a crown.

Gold Inlays

These are a smaller version of a gold crown. (Only allowable if fabricated outside of the mouth).

Endodontics - Root Canal Treatment

This involves the filling of the nerve canal and not the filling of teeth.

Periodontal Treatment

  • Root Planing is a treatment of periodontal (gum) disease
  • Currettage and Debridement is part of root planing.
  • Gum Flaps is a gum treatment.
  • Chrome Cobalt Splint if used in connection with periodontal treatment. (If it contains teeth, relief is not allowable).

Orthodontic Treatment

This involves the provision of braces and similar treatments.

Surgical Extraction of Impacted Wisdom Teeth

When undertaken in a hospital relief is allowable. Certification from the hospital will be required to obtain tax relief.

Bridgework

Dental Treatment consisting of an enamel-retained bridge or a tooth-supported bridge is allowable.

Note

Tax relief is not available for the cost of scaling, extraction and filling of teeth or the provision of artificial teeth or dentures.