The Canada Revenue Agency (CRA) has announced that the costs of medical marijuana are eligible to be written off as a medical expense. This announcement comes at a time when the Income Tax Act has not yet recognized the cannabis legislation.
In order for marijuana purchases to be considered a medical expense, it must be purchased from a licensed producer. The Canadian Medical Cannabis Industry Association (CMCIA), who have been lobbying for a clarification on this topic, were given the news on August 24 through a letter from the Canada Revenue Agency.
Neil Belot, the executive director of the CMCIA, spoke about the recent announcement,
“This is an important step in acknowledging the legitimacy of the way patients use medical cannabis, to help manage the symptoms of a range of health conditions. We have been working with the CRA and the Department of Finance for several months to clarify this issue, and we’re extremely pleased that cannabis regulated by Health Canada has been recognized as an allowable tax expense. It’s very good news, and will help make the use of cannabis as medicine more accessible and affordable for patients.”
Health Canada’s Marijuana for Medical Purposes Regulation requires a prescription to purchase cannabis, which makes it possible to be eligible for deductions. Currently, the Income Tax Act only allows the tax deductions for prescription drugs, not for non-prescription or over-the-counter medicines.