Can I claim tax relief on these Doctor's bills?

[Bear7]

Hi all,

I hope someone can advise me on this.

I was in a car accident 4 years ago and suffered some nasty injuries. Thankfully I'm on the road to recovery.

I took a compensation case against the other party, who accepted total liability. Thankfully there was no legal arguing from the other side. For the last few years I have been attending Doctors and Consultants on a very regular basis. No payment was made by me to these Doctor's, as they were happy to add their bills to the Special Damages aspect of the case. The total Doctor's bills and medical expenses over the last 4 years is approximately €4,000.

The case was listed for hearing last December. On the day, the other side settled the case outside the door. A lump sum was offered, and accepted by me through the barrister. They made it clear that this didn't include medical expenses - it was a take it or leave it type of offer. No Special Damages were given. If the case had gone before the Judge, it appears that the normal practice is to award a lump sum for the injuries, and then to award medical expenses if the Judge believes they were properly incurred. As stated above, this did not happen. The Judge was simply told of the settlement, and approved it.

On my instruction, when my solicitor later received the lump sum he paid the Doctor's what they were owed, and forwarded the remainder to me.

I am now in the process of completing a Med 1 form for 2012. My question is this: Am I entitled to claim tax relief on the Med 1 forms for the last 4 years for the medical expenses incurred as part of this case as I paid for them outside of the Court from my own pocket, albeit from the lump sum settlement?

This has only come to light after an informal chat with a friend who is an accountant, which has me curious more than anything. I would be really grateful if anyone out there has any ideas or suggestions about this.

Thanking you in advance.

 

[Joe_90]

It appears S469 (3) c provides for a claim in cases other than where a specific award is made.

[broken link removed]

So you could claim the expenses in the year in which they were incurred, obviously you will need the correspondence from the medical practitioner to back up the claim if doing it on an incurred as distinct from a payment basis.

Assuming you paid tax in each year then you can claim the expenses @ 20%.

 

[Bear7]

Thanks for the reply, much appreciated.

Just an update.

I rang my solicitor who dealt with the case. The actual Court Order states that the case was settled at hearing and struck out - no mention of medical expenses. She did state that the medical expenses had been agreed in writing prior to the court date. She wondered if this could present a problem, as it could be argued that the other side included the medical expenses in the lump sum.

I then rang Revenue who seemed to think I could claim on the Med 1 form for the medical expenses incurred, but only on the basis that there was no specific award for medical expenses. They were unsure whether or not agreeing to the medical expenses beforehand would show that it was part of the settlement or not, as the expenses were not officially specified. They felt it appeared clear-cut since I paid the bills from the lump sum.

I can see where the solicitor is coming from - if Revenue did contact the solicitors for the other side, they are bound to say that the lump sum included everything. To be honest I can see the merits of that argument myself!! I'm just trying to get a bit of clarity on this issue, as I don't want to do anything illegal. This appears very much a "grey" area type of issue.

Any opinions anyone??