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Docket: 2002-3391(IT)I |
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BETWEEN: |
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ANITA M. HOPE, |
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Appellant, |
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and |
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HER MAJESTY THE QUEEN, |
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Respondent. |
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Appeal heard on April 7, 2003 at Vancouver, British Columbia
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Before: The Honourable Justice L.M. Little |
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Appearances: |
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Agent for the Appellant: |
T. Hope |
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Counsel for the Respondent: |
M. Taylor |
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JUDGMENT
The appeal from the assessment made under the Income Tax Act for the 2000 taxation year is dismissed, without costs, in accordance with the attached Reasons for Judgment.
Signed at Vancouver, British Columbia, this 15th day of July 2003.
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"L.M. Little" |
Little, J.
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Citation: 2003TCC493 |
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Date: 20030715 |
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Docket: 2002-3391(IT)I |
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BETWEEN: |
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ANITA M. HOPE, |
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Appellant, |
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and |
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HER MAJESTY THE QUEEN, |
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Respondent.
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REASONS FOR JUDGMENT
Little, J.
A. FACTS:
[1] The Appellant was diagnosed with Scoliosis of the spine in 1995 (the "Medical Condition").
[2] The Medical Condition has affected the Appellant's back and hips and has restricted her motion in her everyday activities.
[3] The Appellant consulted with her family physician and an orthopaedic specialist and was advised that she would obtain relief and be able to continue to work at her home and her job at the Kinsmen Senior Centre if she had regular massage therapy and heat applied to the spine.
[4] The Appellant purchased a spa and hot tub at a cost of $4,999.00 and a gazebo at a cost of $5,500.00.
[5] The Appellant testified that the gazebo in which the hot tub was located was attached to her house. The Appellant said that since the hot tub was protected by the gazebo she could use the hot tub 12 months of the year.
[6] The Appellant also testified that she incurred the following additional expenses in connection with the hot tub:
Installation Cost (Special Electrical Panel) $1,280.00
Additional Support for Deck $3,000.00
[7] When the Appellant filed her income tax return for the 2000 taxation year she claimed the following medical expenses:
Cost of Spa $4,900.00
Cost of Gazebo $5,500.00
Installation Costs 1,280.00
Miscellaneous 69.66
Total $11,749.73
[8] By Notice of Reassessment dated the 22nd day of October 2001 the Minister reassessed the Appellant's 2000 taxation year and the medical expenses that she had claimed were disallowed.
[9] By a Notice of Reassessment dated the 1st day of February 2002 the Minister allowed the installation cost of $1,280.86 but disallowed the cost of the spa and the cost of the gazebo.
B. TAX ISSUE:
[10] Is the Appellant allowed to deduct the cost of the hot tub and gazebo as a medical expense in determining her income for the 2000 taxation year?
C. ANALYSIS:
[11] The agent for the Appellant filed a number of documents in support of the Appellant's claim (Exhibit A-7).
[12] Dr. Judith E. Fletcher wrote a memo for the Appellant on August 10, 2000. Dr. Fletcher's memo contained the following statement:
Please be aware that I am Anita's family physician and I have advised her for medical reasons to have a hot tub at home.
[13] In a memo dated November 12, 2002 Dr. Mark Adrian, an orthopaedic surgeon, stated:
Ms. Hope has a spinal deformity which is painful. She is able to improve her function with the hydro spa and therefore it appears reasonable for her to continue using it for medical purposes.
[14] Section 118.2 of the Income Tax Act (the "Act") entitles an individual to a medical expense credit. In particular, paragraph (m) of subsection 118.2(2) allows for a credit in respect of any device or equipment for use by the patient that is of a prescribed kind, (i.e. prescribed by Regulation), is prescribed by a medical practitioner and that meets such conditions as are prescribed as to its use or the reason for its acquisition.
[15] Regulation 5700 of the Act provides that for the purposes of paragraph 118.2(2)(m) a device or equipment is prescribed if it is (a) a device that is designed to assist an individual in walking where the individual has a mobility impairment.
[16] The Courts have frequently been asked to determine if an amount paid for a hot tub is a medical expense:
(a) In Clark v. R., [1999] 4 C.T.C. 2005 (T.C.C. [Informal Procedure]), the Tax Court held that since a hot tub is not a device or equipment that is of a prescribed kind pursuant to Regulation 5700 its cost does not qualify for the medical expense credit.
(b) In Craig v. R., [1996] 3 C.T.C. 2037 (T.C.C.), the Tax Court held that paragraph 118.2(2)(1.2) of the Act which refers to modifications that assist an impaired person in moving into a dwelling or moving about the dwelling was oriented towards the transportation of a person rather than ensuring a person's well-being. Thus the expense was not a medical expense of the type described in that section. Further, in that case it was held that the acquisition of the hot tub had not been prescribed by a medical practitioner and consequently the expense could not be allowed on that ground. This case further determined that subparagraph 118.2(2)(m)(i) did not apply as there was no evidence that the hot tub was designed to assist the individual in walking, i.e. mobility.
(c) In Graumann v. R., [2002] 4. C.T.C. 2556 Judge Miller of the Tax Court said at paragraph 13:
The second requirement of Regulation 5700(i) is that the device itself is designed to assist an individual in walking. Clearly, Ms. Graumann experiences pain, stiffness and numbness and the hydrotherapy unit does assist in the relief of those ills. The main purpose of the unit, however, is not to allow Ms. Graumann to walk. Notwithstanding the considerable respect Ms. Graumann garners for what she has accomplished, I cannot in this case stretch the common-sense meaning of "a device to assist in walking" to this hot tub. It is designed to soothe, to relax muscles and to relieve pain perhaps. Its design in this case is not aimed at Ms. Graumann's walking ability. Its design, which Ms. Graumann acknowledged, is more geared for her neck and back, and the results in this regard were most satisfactory. The relief provided did allow Ms. Graumann to function in a working environment. It cannot be said though that the design of the tub assisted her walking, which was not impaired.
(d) Paragraph 59 of Interpretation Bulletin IT-519R2 comments upon the medical expense credit. Paragraph 59 states that "if a medical practitioner prescribes treatments in, for example, a hot tub or a whirl pool bath, the cost of the treatment qualifies as a medical expense under paragraph 118.2(2)(a) if paid for example to a public or licensed private hospital. However, if a hot tub or whirl pool bath is purchased the cost does not qualify as a medical expense since it is not prescribed in ... the Regulations". Although Interpretation Bulletins are not law, they are entitled to weight and can be an important factor in the process of proper interpretation.
[17] I have concluded that the cost of the hot tub and the cost of the gazebo do not meet the requirements of Regulation 5700 and consequently the appeal must be dismissed, without costs.
Signed at Vancouver, British Columbia, this 15th day of July 2003
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"L.M. Little" |
Little, J.
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CITATION: |
2003TCC493 |
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COURT FILE NO.: |
2002-3391(IT)I |
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STYLE OF CAUSE: |
Anita M. Hope and Her Majesty the Queen |
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PLACE OF HEARING: |
Vancouver, British Columbia |
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DATE OF HEARING: |
April 7, 2003 |
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REASONS FOR JUDGMENT BY: |
The Honourable Mr. Justice L.M. Little |
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DATE OF JUDGMENT: |
July 15, 2003 |
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APPEARANCES: |
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Agent for the Appellant: |
T. Hope |
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Counsel for the Respondent: |
M. Taylor |
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COUNSEL OF RECORD: |
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For the Appellant: |
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Name: |
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Firm: |
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For the Respondent: |
Morris Rosenberg Deputy Attorney General of Canada Ottawa, Canada |