HEALTH EXPENSES:THE INTRODUCTION of the Fair Deal nursing home scheme as well as the increasing incidence of people travelling abroad for medical treatment has been reflected in the Finance Bill.

Minister for Finance Brian Lenihan has made significant amendments to the regime for relief on health expenses.

In future, the focus of the relief will be on expenses incurred “by or on the advice of a medical practitioner”. Until now, people were not allowed to claim relief on expenses incurred for treatment at a medical institution unless it had already been approved by the Revenue.

Under the Finance Bill, the prior registration element will be removed.

The Department of Finance said the institutions affected were predominantly nursing homes in Ireland and abroad, and foreign-based hospitals.

The Bill will also clarify relief for the cost of care in nursing homes under the Fair Deal scheme.

Contributions made by the individual or their spouse will qualify for tax relief but not any amount contributed by the State.

In other measures affecting the health sector, the health insurance levy will increase by more than 10 per cent for insured people aged over 18.

Section 133 of the Bill provides for an increase of €25 to the health insurance levy, from €160 to €185, for insured people aged 18 and over, and from €53 to €55 for people under 18.

The Department of Finance said the increase was necessary to ensure the scheme was revenue neutral over its three-year duration, but added that the increase was balanced by an age-related income tax credit.

The Bill also states that the levy on life insurance is to be removed from pension products so as not to discourage people from investing in pensions, as well as proposing a number of changes relating to tax relief for individuals paying nursing home fees.