Tax Relief on Medical Expenses

We examine what medical expenses qualify for tax relief and how an individual can claim the different types of medical expenses.

Eligibility

An individual can claim tax relief for medical expenses they incur and for costs incurred on behalf of any other individual (providing that they pay for these expenses).

Qualifying Medical Expenses

Relief can be claimed on the following expenses:

  • Doctors and consultant’s fees,
  • Diagnostic procedures recommended by a practitioner,
  • Drugs and medicines prescribed by a doctor,
  • Orthoptic or similar treatment,
  • Physiotherapy or similar treatment,
  • Podiatry or chiropody costs,
  • In-vitro fertilisation costs,
  • Nursing home expenses,
  • Cost of purchasing, maintaining and repairing medical, surgical, dental or nursing appliances (including hearing aids), and
  • Non-routine dental care – A MED2 form must be completed by your dentist to determine the quantum of tax relief available.

Healthcare received outside Ireland is eligible once the practitioner providing the healthcare is registered under that country’s laws.

Other Qualifying Medical Expenses

Prescription Costs

Tax relief is currently available for amounts up to €124 per calendar month for prescribed medication. Expenditure more than €124 per month is recoverable from the HSE under the Drugs Payment Scheme.

Over the last few years, the monthly allowable amount has reduced from €144 to the current rate of €124. In budget 2020 it was announced that this monthly amount would be reduced to €114 with effect from September 2020.

The monthly limit applies to an individual, his or her spouse/partner, and any children aged under 18 (or under 23 if in full-time education).

Diet expenses for coeliacs and diabetics

For individuals with specific dietary requirements due to a medical condition, tax relief is available for the cost of certain food products.

The relief applies if you are:

  • a coeliac and you must purchase gluten-free foods specifically manufactured to be gluten-free
  • diabetic and you must buy diabetic products if your doctor recommends that you include these in your diet.

To qualify for relief, you must also provide a letter from your doctor stating that you are coeliac or diabetic and that you have special dietary needs.

The purchase of such foods from supermarkets is allowable provided that the food products are specifically manufactured for coeliac or diabetic patients.

Educational Psychologist Assessments

Tax relief is available for such expenses providing that an assessment was carried out by a qualified educational psychologist for a qualifying child.

A qualifying child is someone under 18 years of age or a child that is in full-time education (i.e. attending university, college, school or another educational establishment).

Speech and Language Therapy

Speech and language therapy costs incurred for a qualifying child (see definition above) also qualify for relief. To be eligible for relief, a qualified speech and language therapist must carry out the therapy.

Non-Qualifying Expenses

The following health expenses are specifically excluded for relief purposes:

  • Routine dental care
  • Routine ophthalmic (eye) care
  • Cosmetic surgery/procedure (unless surgery necessary to correct a health issue)
  • Guide and assistance dog costs (other allowances available).

Expenses Reimbursed

Certain medical or dental expenses may be reimbursed by a medical insurance provider. In such cases, no relief is available for the element reimbursed by the medical insurance provider.

However, tax relief is available for any element that is not reimbursed by the medical insurance provider.

For example, if Adam incurred qualifying medical expenses of €500 during the year of which €200 was reimbursed by his medical insurance provider, tax relief can be claimed on the unreimbursed amount of €300. Adam will be entitled to claim a medical expenses credit of €60 (i.e. €300 x 20%).

How to Claim Tax Relief

  • Tax relief for health expenses is available after the year-end. In exceptional cases, relief may be granted during the tax year.
  • Claims must now be made online using Revenue’s MyAccount facility or when submitting your annual income tax return.

Timeline

You can claim tax relief on qualifying medical expenses incurred in the last four years.

Records

Health expense receipts and supporting documentation must be kept for a period of six years. It is essential to keep these records on file should they be requested by Revenue.

Revenue’s MyAccount service now includes a receipts tracker service which gives taxpayers the option to store their receipt details online.

If you have any questions in relation to the above, or would like for us to make a medical expense claim on your behalf, please contact a member of the Mazars private client team below:

Staff Member

Position

Email

Telephone

Alan Murray

Tax Partner

amurray@mazars.ie

01 449 6480

Siobhán O’Moore

Senior Tax Manager

somoore@mazars.ie

01 449 6418

 

February 2020

Want to know more?

Related Articles

ET-People-Report.jpg

Annual employer reporting for share incentives

Employers who operate share-based reward plans have an obligation to submit an annual return to Revenue providing details of certain share awards in the previous year. Failure to submit the appropriate form can result in a penalty for the employer.

ET-globe.jpg

The Reshaping of Ireland’s Transfer Pricing Regime

The Irish Finance Act 2019 (‘the Finance Act 2019’) was signed on 22 December 2019 and has introduced new laws that will reshape Ireland’s Transfer Pricing Regime. The Finance Act has embraced the latest international tax standards which have resulted in a dramatic change in Irish tax law from 1 January 2020.

Download pdf 921.57 kB

ET-Legislation.jpg

Legislation changes and Revenue clarifications

There have been recent changes to Ireland’s dividend withholding regime, with the rate of withholding having increased to 25% with effect from 1 January 2020. The rate of dividend withholding tax is to be brought into line with the individual shareholder’s marginal tax rate from 1 January 2021. Revenue have also released updated guidance on the tax treatment of accruals and provisions made for financial statement purposes.

ET-RnD.jpg

R&D Subcontractors

Changes brought about under Finance Act 2019 to the new upfront notification requirement is likely to cause administrative challenges. Companies should keep records of notifications sent in the event of a Revenue audit.