While you can’t claim a tax deduction for your medical expenses you may qualify for a tax rebate if your total medical expenses are over $1500 in each financial year.

A tax deduction reduces your net taxable income used by the Australian Taxation Office to calculate how much tax you have to pay. Tax rebates are deducted from the amount of tax you pay.

Seek advice from an accountant about taxation and make the effort to learn how it applies to you and your circumstances. If you understand your taxation then you can take part in decision making.

Know what is subject to a rebate in your yearly tax return and what thresholds apply to you.

Rebates

If you have paid for medical expenses by a registered and qualified doctor, nurse, pharmacist, dentist, optician or optometrist for an illness or operation and if all expenses aren’t recouped by Medicare, there is a tax rebate on the balance.

The medical expenses rebate

Is available to taxpayers and their dependants whose net medical expenses for the year exceed $1500. The amount of the tax offset rebate is 20% - 20 cents in the dollar- of the excess over $1500 with no limit on the amount you claim.

Claimable expenses also include certain dental services or treatment, para medical professionals for therapeutic treatment, (but not cosmetic surgery unless it carries a Medicare item number) and medical or surgical appliances.

You and your dependants must be Australian residents for tax purposes but you can claim medical expenses paid while travelling overseas. You may also be able to include the medical expenses of certain dependants who are waiting to migrate to Australia.

You can claim expenses relating to an illness or operation paid to legally qualified doctors, nurses or chemists and public or private hospitals. However, expenses for some cosmetic operations are excluded.

If you go overseas for treatment you may qualify for a medical expense rebate relating to illness or an operation for fees paid to legally qualified doctors, nurses or pharmacists and public or private hospitals but not for cosmetic surgery.

Airfares and accommodation associated with the medical treatment are not covered. For more details: http://www.ato.gov.au

Dependents

A dependant tax offset only can be claimed if you are an Australian resident for tax purposes and your dependents are Australian residents.

A dependant is:
• A spouse – married or de facto
• Your parents or spouse’s parents
• A student under 25 studying full time at school, college or university
• A child – including stepchildren and adopted children under 21 not studying
• A child-housekeeper – your child of any age working full time keeping house for you
• An invalid relative – your child, brother or sister – 16 or older receiving a disability support pension or a special needs disability support pension, or who has a certificate from a Commonwealth-approved doctor certifying a continuing inability to work.

For more information on tax deductions and entitlements for dependents see the Australian Tax Office website: www.ato.gov.au