Alan and I have three beautiful children ages 4, 6 and 8. Let's face it; children are expensive! Keeping track of some of these expenses can pay off when tax time comes around.
The Tax Office has found that many people are still not taking advantage of a large number of rebates.
20% Tax Offset on net medical expenses over the threshold
One of the most common areas people fail to take advantage is the medical expenses offset. This applies to out-of-pocket expenses (so deduct refunds from Medicare or your health insurer) over the $1,500 threshold. It sounds a lot but it is shockingly simple to reach that amount, especially with a young family or elderly dependents.
Who's included?
The offset applies to you and your dependants. If your household spent over the threshold on unreimbursed medical, you may be able to claim this offset.
What medical expenses count?
Medical expenses can include things like visits to your doctor, hospital, optical, dental, referred physio, prescription medication and even some counselling services.
How much will it be?
The offset amounts to 20% of the amount over the threshold. For instance, if our family had $4,000 of net medical expenses for the year, our offset would be $500 (4,000-1,500 =2,500 x 20% = $500).
It all adds up
It is not difficult for a family to go over the threshold (I single-handedly managed to get us up there just with a little dental work)! It is simple enough to access your medicare statement but you do should be aware of tracking the little things such as prescription medications - they just might be the tipping point to put you over the threshold.
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