2020-0854801I7 Personal protective equipment (PPE) & face masks

Principal Issues: Whether the cost of face masks (for example, when used in the context of the COVID-19 pandemic) may qualify for the medical expense tax credit (METC).

Position: Question of fact. Face masks may qualify as eligible devices under paragraph 5700(c.1) of the Regulations if they are prescribed by a medical practitioner and they meet the requirements in that provision in terms of their use and reason for their acquisition. This being said, based on our understanding of current information about non-medical masks and their recommended use, which is mostly to protect others from the wearer, it would seem generally unlikely that a medical practitioner would prescribe such masks for use by a patient with a severe chronic respiratory or immune condition, or that the patient would use non-medical masks, “to cope with or overcome” their medical condition.

Reasons: The requirements in paragraph 118.2(2)(m) of the Act and paragraph 5700(c.1) of the Regulations.

Author: El-Kadi, Randa
Section: 118.2(2)(j); 118.2(2)(m); 118.2(2)(n); ITR section 5700; ITR section 5701

                                                                                                               February 25, 2021

Marc Grignon                                                                                         HEADQUARTERS
Legislation Section                                                                                 Income Tax Rulings Directorate
Stakeholder Relations Division              
Individual Returns Directorate                                                               Randa El-Kadi
Assessment, Benefit, and Service Branch

                                                                                                               2020-085480

Face masks and the medical expense tax credit

We are writing in response to your query of July 8, 2020, regarding the eligibility of face masks for the purpose of the medical expense tax credit (METC). You thought that an opinion with that regard would be particularly useful in light of the current COVID-19 pandemic and the generally widespread requirement by health authorities to use face masks indoors in public settings.

Unless otherwise specified, all references to the Act and Regulations are references to the Income Tax Act and the Income Tax Regulations.

Our comments

The Canada Revenue Agency’s general views regarding the METC are contained in Income Tax Folio S1-F1-C1, Medical Expense Tax Credit (the Folio).

As indicated in paragraph 1.18 of the Folio, if a particular expenditure is not described in subsection 118.2(2) of the Act (or does not satisfy the additional requirements in sections 5700 or 5701 of the Regulations, as applicable), the expenditure is not eligible for purposes of claiming a METC, even though the expenditure may have been incurred for medical reasons.

We have considered the METC provisions and concluded that paragraph 118.2(2)(m) of the Act and paragraph 5700(c.1) of the Regulations seem to be the only provisions that apply to face masks.

Under paragraph 118.2(2)(m) of the Act, an amount paid for a device or equipment may qualify as a medical expense if certain conditions are met. Generally, to qualify, the device or equipment must be prescribed by a medical practitioner, must be included in the list of qualifying devices or equipment described in section 5700 of the Regulations, and must meet such conditions as are prescribed by the Regulations as to its use or the reason for its acquisition (see paragraph 1.118 of the Folio).

Under the list of prescribed devices or equipment in section 5700 of the Regulations, paragraph (c.1) describes an “air or water filter or purifier for use by an individual who is suffering from a severe chronic respiratory ailment or a severe chronic immune system disregulation to cope with or overcome that ailment or dysregulation.”

Therefore, in order to qualify under paragraph 5700(c.1) of the Regulations, a face mask must, among other things, be considered an air filter or purifier. In this regard, given that the Act does not provide a definition of an air filter or purifier, these terms are to be interpreted using their everyday or common meaning. In Merriam-Webster’s online dictionary, a filter includes “a porous article or mass (as of paper or sand) through which a gas or liquid is passed to separate out matter in suspension,” while a “purifier” takes its meaning from the verb to purify, which is defined as “to make pure as ... to clear from material defilement or imperfection.”

While a face mask may be considered an air filter (despite a broad range of filtration efficiencies among masks), another condition that flows from the description in paragraph 5700(c.1) of the Regulations is that the air filter or purifier must be “for use by an individual suffering from a severe chronic respiratory ailment or a severe chronic immune system disregulation to cope with or overcome that ailment or disregulation.”

The World Health Organization (WHO) and the Public Health Agency of Canada (PHAC), among others, seem to distinguish between non-medical masks (also called fabric masks or face coverings), medical masks (also known as surgical masks or procedure masks) and respirators (such as the N95). It is our understanding that respirators provide the highest levels of filtration and protection to the wearer. According to the WHO document titled “Mask use in the context of COVID-19,” dated December 1, 2020, medical masks filter 3-micrometre droplets, whereas respirators are generally expected to filter 0.075-micrometre solid particles.

We also retain from the WHO document referenced above that a non-medical mask is neither a medical device nor personal protective equipment (PPE). Also, contrary to medical masks and respirators, non-medical masks are not regulated by health authorities or occupational health associations. Therefore, it is our understanding that manufacturers of non-medical masks are not required to comply with guidelines established by standards organizations.

Similarly, we note on Health Canada’s webpage titled “Personal protective equipment (COVID-19): Overview” that, unlike medical masks and respirators, non-medical masks are not listed as PPE. We also retain from that webpage that “Personal protective equipment sold for medical purposes are classified as medical devices in Canada,” and any face coverings that claim to reduce the risk of, or prevent the user from contracting COVID-19, are considered medical masks that are regulated as Class I medical devices. (footnote 1)  To that effect, medical masks and N95 respirators are considered Class I medical devices under Health Canada’s Medical Devices Regulations.

While it seems reasonable to believe that non-medical masks may provide some protection to the wearer, organizations such as the WHO, PHAC, Health Canada and the U.S. Centers for Disease Control and Prevention, seem to consistently recommend non-medical masks for the purpose of slowing the spread of the novel coronavirus (SARS-CoV-2) among the general public, as opposed to protecting the wearer.   

For instance, we retain from the WHO document mentioned above that “Non-medical masks are aimed at the general population, primarily for protecting others from exhaled virus-containing droplets emitted by the mask wearer.” We also retain from the Canadian Centre for Occupational Health and Safety that fabrics generally used in non-medical masks are not the same as materials used in certified masks and, therefore, do not necessarily filter viruses. (footnote 2)  Other sources we considered suggest that non-medical masks can help reduce the spread of airborne infections (such as common colds and the flu) by trapping infectious respiratory droplets that are released by the wearer when the latter talks, coughs or sneezes.

On the other hand, we note that in the context of the COVID-19 pandemic, medical masks are generally recommended for people who are at a higher risk of contracting the novel coronavirus, becoming seriously ill with COVID-19 or dying from the latter disease. For example, the WHO currently recommends that medical masks be used by health workers in particular settings, as well as members of the general public who are either aged 60 or over, or those who have underlying medical conditions. (footnote 3) 

It is a question of fact whether a particular face mask would be considered an eligible device that would qualify for the purpose of the METC. However, based on our understanding of current information about non-medical masks and their recommended use, which is mostly to protect others from the wearer, it would seem unlikely that a medical practitioner would prescribe such masks for a patient with a severe chronic respiratory or immune condition, or that the patient would use such masks, “to cope with or overcome” that condition. To that effect, it seems generally unlikely that non-medical masks would meet the requirements in both paragraph 118.2(2)(m) of the Act and paragraph 5700(c.1) of the Regulations to be eligible for the purpose of the METC.

On the other hand, we are of the view that medical masks and respirators are likely to qualify as eligible devices for the purpose for the METC if they are prescribed by a medical practitioner for a patient to cope with or overcome a severe chronic respiratory or immune condition.

It is incumbent on the individual to be able to demonstrate that the requirements in paragraph 5700(c.1) of the Regulations are met by reference to the prescription from the medical practitioner. As such, the prescription would have to state that the particular face mask or the respirator is for use by an individual who has a severe chronic respiratory or immune condition, to cope with or overcome that condition.

We trust our comments will be of assistance.

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

FOOTNOTES

Note to reader:  Because of our system requirements, the footnotes contained in the original document are shown below instead:

1  See Health Canada’s webpage titled “Regulatory considerations on the classification of non-medical masks or face coverings: Notice to industry.”
2  See the Canadian Centre for Occupational Health and Safety webpage titled “Respirators, Surgical Masks, and Non-Medical Masks” at www.ccohs.ca/images/products/pandemiccovid19/pdf/masks.pdf
3  See the WHO webpage titled “Coronavirus disease (COVID-19): Masks” at www.who.int/emergencies/diseases/novel-coronavirus-2019/question-and-answers-hub/q-a-detail/coronavirus-disease-covid-19-masks and page 4 of the PDF document titled “Mask use in the context of COVID-19” at the following link: www.who.int/publications/i/item/advice-on-the-use-of-masks-in-the-community-during-home-care-and-in-healthcare-settings-in-the-context-of-the-novel-coronavirus-(2019-ncov)-outbreak

PROTECTED B

PROTECTED B

All rights reserved. Permission is granted to electronically copy and to print in hard copy for internal use only. No part of this information may be reproduced, modified, transmitted or redistributed in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, or stored in a retrieval system for any purpose other than noted above (including sales), without the prior written permission of Canada Revenue Agency, Ottawa, Ontario K1A 0L5.

© Her Majesty the Queen in Right of Canada, 2021

Tous droits réservés. Il est permis de copier sous forme électronique ou d'imprimer pour un usage interne seulement. Toutefois, il est interdit de reproduire, de modifier, de transmettre ou de redistribuer de l'information, sous quelque forme ou par quelque moyen que ce soit, de façon électronique, mécanique, photocopies ou autre, ou par stockage dans des systèmes d'extraction ou pour tout usage autre que ceux susmentionnés (incluant pour fin commerciale), sans l'autorisation écrite préalable de l'Agence du revenu du Canada, Ottawa, Ontario K1A 0L5.

© Sa Majesté la Reine du Chef du Canada, 2021