Canada Taxes: Travel Medical Expenses

The rules related to transportation and travel expenses eligible for a medical tax credit are often misunderstood. As per Income Tax Folio S1-F1-C1, Medical Expense Tax Credit “an amount paid to a person engaged in the business of providing transportation services is an eligible medical expense to the extent that the payment relates to transporting a patient to and from a locality, under the following circumstances:

• The patient travels to a place that is at least 40 kilometres away from the locality where he or she dwells to receive medical services;
• Substantially equivalent medical services are unavailable within the patient’s locality;
• The patient takes a reasonably direct travel route having regards to the circumstances; and
• It is reasonable, in the circumstances, for the patient to travel to that place for the medical services.”

If there isn’t a person who is in the business of providing transportation services readily available, a claim is allowed for reasonable expenses for operating a vehicle for the purposes of travelling to obtain medical expenses as long as the criteria mentioned above are met.

If the patient must travel at least 80 kilometres away and the other criteria mentioned above are met, additional expenses (including meals, accommodation and parking) are also considered eligible medical expenditures.

While the rules haven’t changed, we have noticed stricter documentation requirements in order to support a claim for travel expenses required to obtain medical services. The required documentation must include a letter from your local medical practitioner confirming that the medical services were not available locally and therefore the client had to travel to receive such services, as well as confirmation from the out of town service provider that you attended the appointments and the dates of such appointments.

As always, if you have any questions about this or anything else, please don’t hesitate to contact our office.