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Tax Relief On Medical Expenses

Unfortunately, I have been quite unwell this year and have incurred significant medical expenses as a result. A friend of mine believes tax relief may be available on these medical expenses. Can you please confirm if this is the case?

Firstly, I am very sorry to hear you have been unwell and wish you a full and speedy recovery. Your friend is correct; tax relief is available with respect to certain qualifying  medical expenses. You may claim tax relief on certain unreimbursed medical expenses incurred by you for yourself and/or your qualifying dependants. Qualifying health expenses for the purposes of this relief include but are not limited to doctors' and consultants' fees, diagnostic procedures carried out on the advice of a practitioner, drugs or medicines prescribed by a doctor, dentist, or consultant, physiotherapy or similar treatment prescribed by a practitioner. Basically, most medical expenses, with the exception of routine dental and ophthalmic care, qualify for relief. Unreimbursed, nursing home expenditure will also qualify for the relief.

It is important to note, however, that you cannot claim tax relief for any expenditure which has been, or will be, reimbursed by another body such as the VHI, has been, or will be the subject of a compensation payment or relates to routine dental and ophthalmic care.

As mentioned above, you may claim tax relief in respect of any qualifying health expenses paid by you in respect of any individual. This tax relief is available at the standard rate of Income tax, currently 20%.  How you claim the relief available is dependent on your own taxable status. Individuals operating under the self assessment system for income tax purposes can claim the relief as part of their annual income tax return. You should therefore make your accountant or tax advisor aware of any medical expenses incurred during the year. A claim for tax relief must be made within 4 years after the end of the tax year to which the claim relates.

It is important to note, relief is also available with regards to certain expenditure incurred outside the state. Where the relevant qualifying health care is only available outside of the State, then the cost of reasonable travelling and accommodation expenses are also allowable. 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.

With the Income tax deadline for the tax year 2011 now fast approaching, this presents an opportunity for you to review any qualifying expenditure you may have had throughout 2011 and make a claim in respect of same. If you are unsure as to whether certain expenses qualify for this relief, I would advise that you contact a qualified tax advisor in relation to same.