2019-0807521E5 PEMF - pulsed electromagnetic therapy

Principal Issues: Whether in a particular situation, treatments using pulsed electromagnetic fields (EPMF) may be considered "medical services" that are eligible for the purpose of the medical expense tax credit (METC).

Position: Question of fact, depending on whether PEMF therapy is a) provided by a medical practitioner who is authorized by their respective provincial or territorial jurisdiction to provide such therapy/treatments; and b) obtained to treat an existing illness or medical condition.

Reasons: Paragraph 118.2(2)(a) of the Act, which requires that medical services be provided by a medical practitioner within the meaning of subsection 118.4(2); and previous interpretations that payments to medical practitioners are considered eligible medical expenses if paid for medical services that relate to existing illnesses or conditions.

Author: El-Kadi, Randa
Section: 118.2(2)(a); 118.4(2)

XXXXXXXXXX                                                                                                                                           2019-080752
                                                                                                                                                                   Randa El-Kadi
July 30, 2019

Re:  The medical expense tax credit and treatments using pulsed electromagnetic fields

Dear XXXXXXXXXX,

We are replying to your correspondence regarding the medical expense tax credit (METC), which was forwarded to us by the Federal Minister of Health. It is our understanding that you incurred significant medical expenses in respect of your spouse who was diagnosed with XXXXXXXXXX, namely for treatments using pulsed electromagnetic fields (PEMF therapy) and travel to receive such treatments more than 100 km away from your locality. It is also our understanding that although the person who provided these treatments was a trained professional, he was not a member of a designated health profession in your province.

Our comments:

This technical interpretation provides general comments about the provisions of the Income Tax Act (the Act) and related legislation (where referenced). It does not confirm the income tax treatment of a particular situation involving a specific taxpayer but is intended to assist you in making that determination. The income tax treatment of particular transactions proposed by a specific taxpayer will only be confirmed by this Directorate in the context of an advance income tax ruling request submitted in the manner set out in Information Circular IC 70-6R9, Advance Income Tax Rulings and Technical Interpretations.

The Canada Revenue Agency’s (CRA) general views regarding the METC are contained in Income Tax Folio S1-F1-C1, Medical Expense Tax Credit (the Folio), available at canada.ca/en/revenue-agency/services/tax/technical-information/income-tax/income-tax-folios-index/series-1-individuals/folio-1-health-medical/income-tax-folio-s1-f1-c1-medical-expense-tax-credit.

Medical services and PEMF therapy

Paragraph 118.2(2)(a) of the Act allows as an eligible medical expense of an individual an amount paid to a medical practitioner, dentist, or nurse or a public or licensed private hospital for medical or dental services provided to the individual, the individual’s spouse or common-law partner or a dependant of the individual (collectively referred to as “the patient”).

The term medical practitioner encompasses a broad range of individuals in the medical profession, including a medical doctor, pharmacist or nurse. For a medical service provided to an individual, a reference to a medical practitioner is a reference to a person who is authorized to practice in the stated profession according to the laws of the jurisdiction in which the service is rendered (see paragraphs 1.20 to 1.23 of the Folio for additional information).

As explained in paragraphs 1.26 and 1.27 of the Folio, medical services are diagnostic, therapeutic, or rehabilitative services that are performed by a medical practitioner acting within the scope of his or her professional training. Generally, a payment to a medical practitioner is an eligible medical expense when made in respect of a medical service or procedure that relates to an existing condition or illness of the patient (except in the case of fertility-related expenses).

To that effect, it is our view that payments to a medical practitioner for PEMF therapy would qualify for the METC if the treatments meet the conditions for being considered “medical services” (as mentioned above). Given that the regulation of health care professions is a provincial matter, you may want to seek information from the responsible provincial authority or regulatory body about the provision of PEMF therapy to know, for example, whether regulated health professionals providing such therapy are acting within the scope of their professional training. If a provincial authority allows members of a given profession to provide PEMF therapy, then the CRA would rely on the province in determining whether such treatment is an eligible medical service for the purposes of the METC.

For example, in the province of British Columbia (B.C.), it is our understanding that medical doctors can choose to practise complementary or alternative therapies (such as PEMF therapy) in combination with conventional medicine; however, they may do so “in a manner that is informed by medical evidence and science and is in keeping with their professional, ethical and legal obligations,” as per the practice standard for Complementary and Alternative Therapies of the College of Physicians and Surgeons of B.C. The practice standard also requires physicians to “always act within the scope of their practice based on their qualifications, skill and knowledge, and level of competence.” Therefore, a medical doctor in B.C. who provides PEMF therapy in accordance with the College’s aforementioned practice standard would be considered to provide an eligible medical service for the purposes of the METC, as long as the service is provided to treat an existing illness or condition of the patient.

Transportation and travel expenses

Where a service provided by a medical practitioner is an eligible medical expense for the purposes of the METC, certain costs for transportation and travel expenses incurred to obtain the medical service would also be eligible medical expenses under paragraphs 118.2(2)(g) and (h) of the Act (see paragraphs 1.64 to 1.72 of the Folio). Additionally, subsection 118.2(4) allows an individual to claim reasonable expenses in respect of the operation of a vehicle, including gas, if a person engaged in providing transportation services is not readily available.

Under paragraph 118.2(2)(g) of the Act, an amount paid to a person engaged in the business of providing transportation services for transportation of a patient, and a necessary accompanying person, to a place where medical services are normally provided is an eligible medical expense under the following circumstances:

i.    the patient travels to a place that is at least 40 kilometres away from the locality where he or she dwells to obtain the medical services;

ii.   substantially equivalent medical services are not available within the patient’s locality;

iii.  the patient takes a reasonably direct travel route having regard to the circumstances; and

iv.   it is reasonable, in the circumstances, for the patient to travel to that place to obtain those medical services.

Paragraph 118.2(2)(h) of the Act provides that eligible medical expenses include amounts paid for other reasonable travel expenses (including meals and accommodation) if, under the same circumstances, the patient must travel at least 80 kilometres away from the locality where he or she dwells to obtain the medical services. Such expenses are considered eligible if they are incurred during the time that the patient is receiving medical services, and provided that it is reasonable in the circumstances for the patient to remain at the place where he or she is receiving the medical services.

Conclusion

In your situation, even though the expenditure on PEMF therapy was incurred for medical reasons, the treatments themselves were not provided by a medical practitioner and, therefore, do not meet the requirements in paragraph 118.2(2)(a) of the Act. Consequently, transportation and travel expenses to obtain ineligible services would also be ineligible.

While we regret that we could not give you a more favourable response, we trust our comments will be of assistance.

Yours truly,

Lita Krantz, CPA, CA
Manager
Tax Credits and Ministerial Issues
Business and Employment Division
Income Tax Rulings Directorate
Legislative Policy and Regulatory Affairs Branch

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