Medical expenses tax rules for sole traders

If you're a sole trader you will not be able to claim a tax deduction for your medical expenses unless you can prove that the expense (or a specific proportion of it) was incurred wholly and exclusively for the purposes of your trade.

medical expenses

Examples of medical expenses you can claim:

So are there any examples where someone can obtain a tax deduction for medical expenses?

In the case of Parsons v HMRC (see here) a stunt performer was able to obtain a tax deduction for the following expenses:

  • The cost of a private operation on his knee.  Whilst the taxpayer could have waited to have obtained an operation under the NHS, the cost of the work was essential to his business because he could not perform stunts with a bad knee.
  • The cost of back treatment and massage. The cost of this was not essential to his private life, however he could not perform stunts with a bad back and aching muscles.

However, he was not able to claim a tax deduction for the following expenses:

  • Dental treatment. It was not deemed essential for his work as he needed his teeth for eating which is a private benefit.
  • Health and fitness costs. These expenses were also not business specific.  His trade as a stunt perfomer did not require him to maintain his general health and fitness.

Examples of other cases of where a claim for medical expenses have failed are as follows:

  • A guitar player failed in his claim for an operation on his hand. Because he played the guitar for pleasure as well as professionally, it was impossible to apportion the cost of his operation between business and pleasure.
  • A beauty salon owner failed in her claim for Scientology counselling sessions(!) because she eventually admitted that these sessions were undertaken for personal reasons and not in relation to her business as a beauty salon owner.

So as a golden rule, if you are considering claiming a tax deduction for medical expenses you should bear the following in mind :

  • It is extremely difficult to prove that there is no personal benefit asociated with medical expenses.
  • A tax deduction for medical expenses will only be successful where it can be proved that the cost is totalling unneccessary for personal well-being (see above).

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