Medical Marijuana is Deductible for Tax

In a ruling dated August 24, 2015 CRA confirms that registered patients under Health Canada’s Marihuana for Medical Purposes Regulations (MMPR) who receive a prescription (authorization) for medical marijuana from a physician, and purchase cannabis from a licensed producer, may claim the cost of their cannabis as an allowable medical expense on their Canadian income tax return which can result in an income tax credit. The letter goes on to clarify that amendments to the Income Tax Act have not yet been made to include the MMPR, “[T]he CRA will not disallow eligible medical expenses claimed for the purchase of medical marihuana allowable under these new regulations”. The general rules for claiming medical expenses under Canada’s Tax Act allows prescription medicines acquired for use by an individual taxpayer or spouse, when prescribed by a medical practitioner however non-prescription or over-the-counter drugs including vitamins cannot be claimed, even when prescribed by a physician.