Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the Department.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle du ministère.
February 11, 2000
XXXXXXXXXX
Dear XXXXXXXXXX:
Thank you for your letters of November 18, 1999, and January 10, 2000, on behalf of XXXXXXXXXX, concerning the medical expenses of a senior living in a retirement home. As you know, on November 1, 1999, Revenue Canada became the Canada Customs and Revenue Agency (CCRA).
XXXXXXXXXX is particularly concerned about comments made in a newspaper article on the Tax Court of Canada decision in the case of The Estate of Freeman Miles V The Queen. In that case, Judge Margeson concluded that the amounts paid by Mr. Miles to a particular retirement home in 1995 did not qualify as medical expenses for purposes of the Income Tax Act as they were not payments for full-time care in a nursing home.
Individuals, who meet certain criteria set out in the Act, can claim the cost of full-time care in a nursing home as a medical expense. It is the CCRA's position that a particular place does not necessarily need to be licensed as a nursing home in order to be considered as such, but it must have sufficient staff to operate as a nursing home. In other words, the facility must have the equivalent features and characteristics of a nursing home in order to qualify as a nursing home for purposes of the medical tax credit. Therefore, it must provide sufficient qualified medical personnel to provide nursing care to its residents on a 24-hour basis. In the case of a facility that provides multiple levels of care, the portion of the facility that provides regular nursing care similar to that of a nursing home will qualify as a nursing home, and the portion of the facility that does not provide such care will not qualify.
Any changes to the rules governing medical expenses would require a change in policy and an amendment to the Act. Since tax policy issues and recommendations to amend the legislation are the responsibility of the Department of Finance, they would have to be considered by that department. In this regard, I have forwarded a copy of our correspondence to the Honourable Paul Martin, Minister of Finance, for his consideration.
I trust this is of assistance.
Yours sincerely,
Martin Cauchon
C.C. The Honourable Paul Martin, P.C., M.P.
Minister of Finance