Additional Medical Expenses Tax Credit

What’s new?

• 3 October 2022 – Invitation to webinar on Allowable Medical Expenses

  During this year, SARS started contacting taxpayers who were selected for a verification audit due to medical expenses claimed on their 2021 income tax return. This is being done to confirm that taxpayers who claim for medical expenses understand why their claims are disallowed so as to provide clarity and certainty of their tax matters to them. In these engagements, taxpayers are also afforded the time to ask the SARS official any questions they may have. 

  In line with our strategic objectives, SARS believes that when taxpayers and traders have clarity and certainty about their tax obligations, they will be in a better position to comply with their tax obligations. Central to this objective is ensuring that our education content is clear and easy to understand.

  SARS would like to invite you to attend a webinar on Allowable Medical Expenses which aims to clarify any questions on the topic. and complete a short survey at the end of the webinar. At the end of the session, you will be asked to complete a short survey to assist SARS in developing more helpful and relevant education interventions for you and other taxpayers.

  Webinar details:

  Theme:  Allowable Medical Expenses
  Date: Thursday, 6 October 2022
  Time: 17:00 – 19:00
  YouTube: https://youtu.be/YAAPPDqXb5s

What is it?

What amounts are regarded as qualifying medical expenses?

• Services rendered and medicines supplied by any duly registered medical practitioner, dentist, optometrist, homeopath, naturopath, osteopath, herbalist, physiotherapist, chiropractor or orthopaedist;
• Hospitalisation in a registered hospital or nursing home;
• Home nursing by a registered nurse, midwife or nursing assistant, including services supplied by any nursing agency;
• Medicines prescribed by any duly registered physician (as listed above) and acquired from any duly registered pharmacist;
• Expenditure incurred outside South Africa in respect of services rendered or medicines supplied which are substantially similar to the services and medicines listed above;
• Any expenses prescribed by the Commissioner and necessarily incurred as a result of any physical impairment or disability.
  • List of Qualifying Physical Impairment or Disability Expenditure Effective 1 March 2012
  • List of Qualifying Physical Impairment or Disability Expenditure Effective 1 March 2020

Who is a dependant?

• A spouse;
• A child and the child of a spouse (e.g. son, daughter, step son, step daughter, legally adopted child)
  • Who was alive during any portion of the year of assessment, and who on the last day of the year of assessment:
    • Was unmarried and was not or would not, had he or she lived, have been:
      • Older than 18 years
      • Older than 21 years and was entirely or partly dependent for maintenance on the person and has not become liable to pay normal tax for the year
      • Older than 26 years and was entirely or partly dependent for maintenance on the person and has not  become liable to pay normal tax for the year and was a full-time student at an educational institution of a public character; or
    • In the case of any other child, was incapacitated by a disability from maintaining himself or herself and was entirely or partly dependent for maintenance on the person and hasn’t become liable to pay normal tax for that year;
• Any other member of a person’s family for whom he or she is liable for family care and support (e.g. mother, father, mother-in-law, father-in-law, brother, sister, grandparents, grandchildren); or
• Any other person who is recognised as a dependant of that person in terms of the rules of a registered medical scheme or fund.

Calculation of the Additional Medical Expenses Tax Credit

• 33,3% of the fees paid by the person to a registered medical scheme (or similar qualifying foreign fund) as exceeds three times the amount of the MTC to which that person is entitled; plus
• 33,3% of the qualifying medical expenses paid by the person (for example out-of-pocket expenses).

• 33,3% of the fees paid by the person to a registered medical scheme (or similar qualifying foreign fund) as exceeds three times the amount of the MTC to which that person is entitled; plus
• 33,3% of the qualifying medical expenses paid by the person (for example, certain out-of-pocket expenses).