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Net Medical Expenses Tax Offset Phase Out by 2019

15
Mar

Net medical expenses are your total medical expenses, less refunds from Medicare and private health insurers, which you, or your dependents, paid during the financial year.

In 2013, the Government announced a program to phase out the Net Medical Expenses Tax Offset (NMETO). The NMETO is being phased out between the 2015-16 and 2018-19 income years. However, you can still claim the offset for eligible expenses relating to disability aids, attendant care or aged care expenses until 1 July 2019.

If you received the NMETO in your 2015-16 tax return, you will not be eligible to receive the offset for all eligible medical expenses in your 2016-17 tax return except expenses relating to disability aids, attendant care or aged care expenses.

Income Testing
In addition, it should be noted that, this Net Medical Expenses Tax Offset is income tested. The percentage of net medical expenses you can claim is determined by your adjusted taxable income (ATI) and family status:

	Single		Family
Adjusted Taxable Income threshold	$90,000 or less	over $90,000	$180,000 or less	over $180,000
Claim percentage	20% of medical expenses over $2,265	10% of medical expenses over $5,343	20% of medical expenses over $2,265	10% of medical expenses over $5,343
Additional	N/A		*plus $1,500 for each dependent child after the first