Principal Issues: Whether an amount paid by the taxpayer for a vaporization system designed to allow smoke free inhalation of medical marihuana qualifies as a medical expense for purposes of calculating the medical expense tax credit.
Position: No.
Reasons: Based on the interpretation of the particular provisions.
XXXXXXXXXX 2012-043279 André Gallant
January 30, 2012
Dear XXXXXXXXXX :
Re: Medical expenses
We are writing in reply to your letter, which we received on January 11, 2012, wherein you enquire whether the cost of a medical marihuana vaporization system (Volcano MEDIC Vaporization system or "MEDIC") would qualify as an eligible medical expense for the purposes of the medical expense tax credit ("METC").
Based on the information you provided, it is our understanding that the MEDIC allows for the smoke free inhalation of medical marihuana in order to avoid the production of irritating toxic and carcinogenic by-products, and that a medical device licence was obtained from Health Canada for the MEDIC in 2010.
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), 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.
Under paragraph 118.2(2)(m) of the Act, an amount paid for a device or equipment may also qualify as an eligible medical expense if certain conditions are met. Generally, to qualify, the device or equipment must be prescribed by a medical practitioner, must be included in the list of qualifying devices or equipment described in section 5700 of the Income Tax Regulations (the "Regulations") and must meet such conditions as are prescribed by the Regulations as to its use or the reason for its acquisition.
Paragraph 5700(c), for example, refers to a "device or equipment, ... designed exclusively for use by an individual suffering from a severe chronic respiratory ailment...".
It is a question of fact whether a patient is suffering from a "severe chronic respiratory ailment" and whether a device was "designed exclusively for use by" such a patient.
However, based on the information provided, it would appear that the MEDIC was not designed "exclusively" for use by an individual already suffering from a severe chronic respiratory disease. Even if the MEDIC was in part designed to benefit patients who already suffer from different severe chronic respiratory ailments, it is our understanding that it was also designed for use by individuals currently suffering with non-respiratory ailments.
We trust our comments will be of assistance to you.
Yours truly,
G. Moore
for Director
Business and Trusts Division
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch