|
When it comes to tax deductions, there are some areas like medical expenses that can be confusing about what you can claim and what you cannot. Take a minute to read over this article to help clear up the confusion. Changes announced in the last Federal Budget indicated that from July 1, 2012 the Net Medical Expenses Tax Offset has two income-based thresholds (an upper and lower), both indexed annually. Net medical expenses are the total amount spent on medical expenses minus any reimbursements paid by private health insurance or Medicare. You and your dependants must be Australian residents for tax purposes, but you can claim medical expenses paid while travelling overseas. Once net medical expenses are more than the thresholds, a taxpayer is eligible to claim the offset. Those with a threshold based on the lower income amount are able to claim 20% of expenses over the threshold, but those required to pass the higher threshold can only claim 10% of the excess. In fact when you combine some other health-related financial factors, it will certainly pay to stay healthy going forward. Apart from already increased private health insurance premiums, anyone with a situation that sees them incurring higher medical costs plus exceeding certain income levels has the potential to be hit three ways: 1. A reduced and means-tested private health insurance rebate 2. A higher threshold to pass before being able to claim medical expenses 3. A halving of the amount that can be claimed once that threshold is reached Who is covered for claims? The tax offset can only be claimed for: • You, your spouse or de facto • Children up to age 21, including adopted and stepchildren • Child-housekeeper, invalid relative, parent or spouse’s parent The medical expenses that are covered include those made: • To a medical practitioner, nurse or chemist, or a public or private hospital, in respect of an illness or operation • For dental services or treatment • For therapeutic treatment by referral from a medical practitioner • For the purchase or repair of an artificial limb, artificial eye or hearing aid • For purchase or repair of prescribed medical aids • For the testing of eyes, the prescribing of lenses, for the supply or repair of spectacles • To a person who looks after someone who is blind, or confined to bed or a wheelchair • To keep a trained guide dog to assist a blind person, the hearing impaired or other disabled individuals. There are also many expenses that are not eligible, so before you begin making your medical expense plans, check the legislation thoroughly and if you still have questions, seek the advice of a tax agent. While medical expenses can be overwhelming, it can be downright hopeless to realize that expenses that you thought were going to be covered are, in fact, not. The best plan is to focus on keeping you and your family healthy to prevent having to worry about these measures, keep impeccable records and consult a professional in time. For more information about Medical Indemnity Insurance Australia and Tax Deductions in Australia please visit our website http://www.taxforhealthprofessionals.com.au/
Related Articles -
Health Medical Insurance, Tax Deductions in Australia,
|
