Take your vitamins – just don't try to claim the expense on your taxes
Natural health products, including vitamins, minerals, herbs, and naturopathic supplements, do not qualify for the medical expense tax credit (METC).
The reason for this stems from the wording in the Tax Act which includes, in the definition of a medical expense, “an amount paid…for drugs, medicaments or other preparations or substances… that can lawfully be acquired for use by the patient only if prescribed by a medical practitioner or dentist, and the purchase of which is recorded by a pharmacist.”
Since most natural health products can lawfully be acquired without a prescription and such purchases do not need to be “recorded by a pharmacist,” the Canada Revenue Agency’s longstanding view is that the cost of such products do not qualify as eligible medical expenses.
A recent tax case tried to challenge this law. The taxpayer was denied a portion of the METC he claimed on his 2011 tax return for the purchase of natural health products including vitamins, minerals, herbs and naturopathic supplements which were prescribed to his wife by a naturopathic physician. The CRA denied the claim.
The taxpayer explained that as part of his wife’s integrated cancer treatment, she saw a naturopathic physician who prescribed natural health products to treat the side effects of her chemotherapy. He testified that his wife could not tolerate the prescription drugs available to treat those side effects. While most of the prescribed products were purchased directly from the naturopathic physician, the remainder were purchased from a health food store.
The evidence showed that the herbal formulations, vitamins, botanicals and naturopathic medicines she bought were not prescription drugs dispensed by a pharmacist and a prescription was not required to obtain them. Nonetheless, the taxpayer argued that the definition of “drugs” in the Tax Act “should be interpreted in a way that would include the natural health products prescribed by [his wife’s doctor].”
The judge disagreed and pointed to the fact that the Tax Act was specifically amended in 2008 in response to prior decisions of the Tax Court which allowed medical expense claims for the cost of substances which had been prescribed by a doctor but which were legally obtainable without a prescription. The amendment to the law was to make it clear that that the intention of Parliament was to limit the METC “to medications lawfully obtainable only by prescription.”
The taxpayer also tried to argue that the law violates his wife’s rights under the Charter of Rights and Freedoms, citing the Supreme Court of Canada’s 2013 decision which struck down Canada’s anti-prostitution laws as being unconstitutional. It was argued that those laws “infringe the [Charter] rights of prostitutes by depriving them of security of the person in a manner that is not in accordance with the principles of fundamental justice.” The highest court found that prostitutes’ lack of security of the person was a direct result of the anti-prostitution laws.
The Tax Court judge rejected the taxpayer’s argument, saying that in the present case, there wasn’t a sufficient connection between the denial of the METC for naturopathic remedies and an individual’s security of the person.
In dismissing the taxpayer’s case, the judge wrote that the denial of the METC does not impose “dangerous conditions upon her, since (it)…does not prevent her from obtaining the natural products that she requires. At most, it imposes, indirectly, a higher cost to her of those substances and thereby creates an economic barrier to that course of medical treatment. This engages economic rights, which are not protected by …the Charter.”