19 June 2003 Internal T.I. 2003-0024947 - MEDICAL EXPENSES - MARIHUANA

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CRA.
Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ARC.

Please note that the following document, although believed to be correct at the time of issue, may not represent the current position of the CCRA.

Prenez note que ce document, bien qu'exact au moment émis, peut ne pas représenter la position actuelle de l'ADRC.

Principal Issues: Does the cost of medical marihuana qualify for the medical expense tax credit?

Position: The cost of medical marihuana qualifies for the medical expense tax credit only if it is prescribed by a medical practitioner or dentist and recorded by a pharmacist.

Reasons: Requirements are set out in paragraph 118.2(2)(n) of the Act.

June 30, 2003

	XXXXXXXXXX  Tax Centre	HEADQUARTERS
	XXXXXXXXXX 	Bob Naufal, CMA
	T1 Reassessment	(613) 957-2744

		2003-002494

Re: Medical expense tax credit - medicinal marihuana

We are writing in response to your memorandum dated June 9, 2003 wherein you asked us if the cost of marihuana used for medicinal purposes qualifies as a medical expense for purposes of computing the medical expense tax credit ("METC"). We acknowledge the additional information submitted with your memorandum, including a letter and prescription slip from the taxpayer's psychiatrist as well as a signed affidavit from the taxpayer with respect to the use of the marihuana. In Schedule B to his affidavit, the taxpayer stated that he acquired the marihuana from a medicinal marihuana compassion group.

Our Comments

Subsection 118.2(2) of the Income Tax Act (the "Act") contains the list of medical expenses that qualify for the METC. Included in the list of qualifying medical expenses are any drugs, medications or other preparations or substances that are prescribed by a medical practitioner or dentist, and recorded by a pharmacist (see paragraph 118.2(2)(n) of the Act). In addition, to qualify as a medical expense, the amount paid must be in respect of a drug, medication or other preparation that is manufactured, sold or represented for use in:

(i) restoring, correcting or modifying an organic function;

(ii) diagnosing, treating or preventing a disease, disorder or abnormal physical state; or

(iii) treating the symptoms of a disease, disorder or abnormal physical state.

Based on the information submitted, the cost of medical marihuana to the taxpayer would not qualify for the METC as the marihuana was acquired other than through a licensed pharmacist.

We recognize that the restrictions in paragraph 118.2(2)(n) may have been drafted without consideration of the unique circumstances faced by the taxpayer. However, unless paragraph 118.2(2)(n) is amended to accommodate the acquisition of drugs other than through a pharmacist or a particular taxpayer obtains his or her medical marihuana through a pharmacist, we are not in a position to treat the costs incurred as qualifying medical expenses. Given that the result in this particular case may be unintended, we are providing the Department of Finance with a copy of this letter.

We trust our comments will be of some assistance.

Daryl Boychuk, LL.B
for Director
Business and Partnerships Division
Income Tax Rulings Directorate

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