Medical Tax Offset

If you spend more than a certain amount in one year, on ELIGIBLE medical expenses, you are able to get a Tax Offset from the Australian Tax Office (ATO) of 20% of the amount spent above that threshold figure.

The threshold figure for the 2010-11 tax year is increasing to $2,000.

The threshold figure for the 2008-09 and 2009-10 tax years is $1,500.

Therefore a couple of basic calculation to explain this are as follows:

• Total spend on eligible Medical expenses is $2,000
  2009-10 = That figure is $500 above the $1,500 threshold. You get 20% of that $500 = $100.
  2010-11 = No rebate as the figure is not above the threshold.
  
• Total spend on eligible Medical expenses is $5,000
  2009-10 That figure is $3,500 above the $1,500 threshold. You get 20% of that $3,500 = $700.
  2010-11 That figure is $3,000 above the $2,000 threshold. You get 20% of that $3,000 = $600.
  

Who can claim the Medical Tax Offset

Any person that is Tax resident in Australia can claim for themselves, their spouse and children under 21.

Further details at the ATO page in the Links section below.

What is eligible under the Medical Tax Offset

Any out of pocket medical expenses payable to legally qualifed Doctors, relating to an illness or operation, or associated items such as:

• Dentists
  
• Orthodontists
  
• Opticians
  
• Prescription glasses
  
• Contact lenses
  

These expenses do NOT have to be made in Australia, as you can also claim medical expenses paid whilst travelling overseas.

Expenses for cosmetic operations may not be covered under this scheme.

Some expenses which do not qualify for the tax offset :

• chemist-type items � such as tablets for pain relief � purchased in retail outlets or health food stores
  
• non-prescribed vitamins or health foods
  
• purchases from a chemist that are not related to an illness or operation
  

Further details at the ATO page in the Links section below.

Links

• Medical Tax Offset - Australian Tax Office