It is almost June again, and time to think about maximising your tax deductions. This can be a tedious process! However, we at Transitions want to help out a little by letting you know how you can save money on your medical hair loss solution, in addition to any help you may be receiving from your health insurance provider. Did you know that your wig may be considered as a medical expense for the purposes of your tax claims? Under this definition, you may be able to save 20% of the cost of your hair replacement system. Check out the details below.
According to the Taxation Ruling TR93/34 you should be able to add the cost of your wig to your medical claims. Below are some quotes from the ATO website relating to the Income Tax: Medical Expense Rebate (Taxation Ruling TR93/34):
Net medical expenses includes: payments for a ‘medical or surgical appliance’ prescribed by a legally qualified medical practitioner.
A ‘medical or surgical appliance’ for the purposes of paragraph (f) of the definition of ‘medical expenses’ in subsection 159P (4) is an instrument, apparatus or device which is:
a) Manufactured as; or
b) Distributed as; or
c) Generally recognised to be an aid to the function or capacity of a person with a disability or illness.
Examples of a ‘medical or surgical appliance’ include:
(m) Medical or surgical wigs for use by a person which is necessitated by loss of hair through sickness or disease (other than naturally occurring baldness) or the effects of the treatment of sickness or disease
Click here for full details on this ruling.
According to the Australian Taxation Office Supplementary Tax Return Subsection T9, if your medical appliances cost $2060.00 or more, you are eligible to claim 20% of the cost back on your tax return. That is a huge saving!
What does all of this mean?
If you buy your new hair before June 30th 2013, you will increase the amount you are able to claim and save more. Due to a $2060.00 threshold (minimum spending requirement) before the tax saving kicks in, it make sense update your hair prior to June 30th 2013. This way you maximise the amount you can claim. Essentially, the more you spend this financial year, the more you can claim and the more you save. If you wait till after June 30th, the amount you can claim will be diluted and you will have to wait a whole year until you can claim the benefit. Call us today to get your next order started Ph: 02- 9212 4950.
Please check with your tax advisor to make sure you are getting the most current information on medical claims in Australia. There are also government subsidies available for medical wigs which differ from state to state. For example, in NSW the government department to speak to is the Program of Appliances for Disabled People (PADP). It is worth doing your homework to make sure that you are getting all the help available to you to pay for your new wig, topette, or hair replacement system.
