In a September 13, 2013 Tax Court of Canada case, the taxpayer’s claim for amounts paid to install engineered hardwood flooring as a medical expense was denied by CRA. The engineered hardwood replaced fairly new carpet in the taxpayer’s five year old home on the advice that her husband, who suffers from progressively debilitating Parkinson’s disease and psoriatic arthritis, was at serious risk of the carpet causing a fall.
There was no dispute that the new flooring would enable the Appellant’s husband to be more mobile and functional within the dwelling. However, in order to claim a medical expense, the law also requires that the expense:
(i) not typically be expected to increase the value of the dwelling; and
(ii) not normally be incurred by persons who have normal physical development or who do not have a severe and prolonged mobility impairment.
CRA argued that the engineered hardwood flooring had to be excluded under both requirements.
The Court was satisfied with the evidence that modestly priced engineered hardwood flooring, as opposed to solid hardwood flooring, would not typically increase the value of the property, especially when replacing fairly new, quality carpet in only a portion of the home. The Court further concluded that the taxpayer “only put in what was necessary” and that this expense would not normally have been incurred in the absence of the medical need. As such, the expense was allowed.
Action Item: Large medical expenses are routinely reviewed by CRA. Contact us before incurring significant costs to determine if they may qualify as a medical expense.
Contact us if you have further questions or wish to discuss!