Principal Issues: Whether the costs relating to 1) the services provided by a naturopath in Ontario and 2) remedies purchased through a naturopath, such as injectable vitamin C and mistletoe, would qualify as medical expenses for purposes of the METC.
Position: 1) Yes. 2) Generally no, unless the remedies qualify under 118.2(2)(k) which allows the cost of insulin, oxygen, liver extract injectible for pernicious anaemia or vitamin B12 for pernicious anaemia as prescribed by a medical practitioner. Only drugs that can lawfully be purchased only by prescription (or only with the intervention of a medical practitioner) will qualify under 118.2(2)(n). However, it is a question of fact whether a particular drug may lawfully be acquired only by prescription (or only with the intervention of a medical practitioner).
Reasons: 1) As indicated on the CRA web site, naturopaths are recognized as medical practitioners in Ontario. 2) Wording of 118.2(2)(k), 118.2(2)(n) and Regulation 5701.
XXXXXXXXXX 2011-042603
January 24, 2012
Dear XXXXXXXXXX :
Re: Medical Expense Tax Credit
This is in response to your email of October 26, 2011.
You enquired whether payments you made for services provided to you by a Doctor of Naturopathic Medicine in Ontario, and the costs of intravenous vitamin C (ascorbic acid) treatments, mistletoe injections and other products that you have purchased through your naturopath to help treat cancer, would be eligible as medical expenses for purposes of the medical expense tax credit ("METC").
Our Comments
Medical expenses which are eligible for the METC are limited to those described in subsection 118.2(2) of the Income Tax Act (the "Act"). If a particular expenditure is not described as an eligible medical expense in subsection 118.2(2) of the Act, or if the conditions under which the expenditure would qualify are not met, the expenditure does not qualify for purposes of the METC, even though the expenditure may have been incurred for medical reasons.
Services provided by a naturopath in Ontario
Under paragraph 118.2(2)(a) of the Act, qualifying medical expenses include payments made to a medical practitioner, dentist or nurse or a public or licensed private hospital when the payments are made in respect of medical or dental services provided to the individual, the individual's spouse or a dependant of the individual. Paragraph 118.4(2)(a) of the Act provides that where the reference to a medical practitioner is used in respect of a service rendered to an individual, that reference is to a person authorized to practice as such pursuant to the laws of the jurisdiction in which the service is rendered. Therefore, in order to determine whether a particular medical practitioner qualifies as such under the Act, one must look to the relevant provincial legislation to determine whether the particular practitioner is authorized under the laws of that province.
In our view, a person is authorized by the laws of the jurisdiction to act as a medical practitioner if there is specific legislation that enables, permits or empowers a person to perform medical services. Generally, such specific legislation would provide for the licensing or certification of the practitioner as well as for the establishment of a governing body (e.g., a college or board) with the authority to determine competency, enforce discipline and set basic standards of conduct.
The Canada Revenue Agency Web site provides a summary chart identifying those health care professionals authorized to practice as medical practitioners by province or territory for the purposes of claiming medical expenses. It appears that naturopaths are authorized as medical practitioners in the province of Ontario and the cost of services they provide would qualify for the METC if they are medical services.
Injectable vitamins and other products
Paragraph 118.2(2)(k) of the Act allows as a medical expense amounts paid "for insulin, oxygen, liver extract injectible for pernicious anaemia or vitamin B12 for pernicious anaemia" that are prescribed by a medical practitioner.
Subparagraph 118.2(2)(n)(i) of the Act allows the costs paid for drugs, medicaments or other preparations or substances (hereinafter referred to as "drugs"):
A. that are manufactured, sold or represented for use in the diagnosis, treatment or prevention of a disease, disorder, abnormal physical state, or the symptoms thereof or in restoring, correcting or modifying an organic function,
B. that can lawfully be acquired for use by the patient only if prescribed by a medical practitioner or dentist, and
C. the purchase of which is recorded by a pharmacist.
Based on the foregoing, only drugs that can lawfully be purchased only with a prescription qualify under this provision.
Drugs that may lawfully be acquired without a prescription may qualify for the METC under subparagraph 118.2(2)(n)(ii) of the Act as prescribed under section 5701 of the Income Tax Regulations (the "Regulations") which allows the cost of a drug if the drug:
(a) is manufactured, sold or represented for use in the diagnosis, treatment or prevention of a disease, disorder or abnormal physical state, or its symptoms, or in restoring, correcting or modifying an organic function;
(b) is prescribed for a patient by a medical practitioner; and
(c) may, in the jurisdiction in which it is acquired, be lawfully acquired for use by the patient only with the intervention of a medical practitioner.
Thus, a drug that may only be acquired through the intervention of a medical practitioner (a pharmacist, for example) may qualify under section 5701 of the Regulations even if it does not lawfully require a prescription. However, pursuant to this provision, the patient must still obtain a prescription for the particular use of the drug.
It is a question of fact whether a particular drug may lawfully be acquired only by prescription (or only with the intervention of a medical practitioner). Therefore, it would be necessary to examine the applicable federal and provincial/territorial legislation and regulations in order to make that determination for a particular drug.
Natural health products that are available for self-selection as over-the-counter products would not generally meet the requirements of any of the above noted provisions, and therefore such products would not qualify for the METC unless paragraphs 118.2(2)(k) or 118.2(2)(n) of the Act apply.
For information on how to claim eligible medical expenses, you can visit our Web site at www.cra.gc.ca/medical.
We trust that these comments will be of assistance.
Yours truly,
G. Moore
for Director
Business and Partnerships Division
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch