Does the medical expenses tax offset still exist in Australia?

The net medical expenses tax offset (NMETO) was phased out and abolished from the 2019-20 income year onward. It no longer exists. If you spend large amounts on medical costs out of pocket, you cannot claim them as a deduction or tax offset on your federal tax return.

There is a limited carryover for a small number of disability aids, attendant care, and aged care expenses that were part of the old NMETO, but the general medical expenses offset for doctor, hospital, dental, and prescription costs is gone.

The main mechanism for offsetting medical costs now is private health insurance, which reduces your exposure to the Medicare Levy Surcharge and may provide hospital and extras cover. The private health insurance rebate (means-tested) provides some financial assistance for premiums. However, out-of-pocket medical expenses themselves are not tax deductible for individuals. Some work-related medical costs (like drug testing required by an employer, or first aid training when required for work) can be deducted as work expenses, but routine personal health costs cannot.