A recent tribunal case highlighted the strict boundaries around claiming medical expenses on tax, even when they’re tied to a disability.
Case Summary:
Mr. Wannberg, a former worker on a disability pension from super, claimed nearly $100,000 in therapy and medical expenses as tax deductions. The ATO rejected the claim — and the Administrative Review Tribunal agreed.
Why?
The court ruled that medical expenses don’t qualify unless they directly help produce assessable income. In this case, the pension was payable because of his disability — not because he was actively working or maintaining employment.
Key Takeaways:
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There must be a clear link between the expense and income generation
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Medical treatments, while essential, are generally considered private expenses
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If unsure, seek a private ruling from the ATO or professional advice
This decision is a sobering reminder that tax law often separates personal wellbeing from income-earning activities.
