An individual’s ability to pay tax may be adversely affected by costs incurred as a result of illness or disability. For this reason, a certain degree of relief is provided by the Income Tax Act No.59 of 1962 (the Act).
Timing of Deduction
Qualifying medical contributions and expenses may only be claimed in the tax year that they are paid. Expenses can be incurred during a tax year and not paid in the same year. The expenses should only be claimed in the tax year in which it is actually paid.
This guide provides general guidelines regarding the deductibility of medical expenses for income tax purposes. It does not delve into the precise technical and legal detail that is often associated with tax. This guide provides information obtained from our experience in dealing with SARS on a daily basis.
Persons for whom contributions and expenses may be claimed
Only qualifying expenditure paid by the taxpayer for the following persons may be considered in the determination of the medical allowance:
Important: The patient may be any one of the persons listed above, but the payment must be made by the taxpayer, in order for the taxpayer to be able to claim the medical allowance.
Qualifying contributions to a medical aid
Any contributions paid by you for yourself, your spouse, your children and your dependents, to a medical scheme registered under section 24(1) of the MS Act.
Contributions paid by an employer of a taxpayer, which are included in the taxable income of the taxpayer as a taxable benefit, is deemed to be contributions paid by the taxpayer.
Qualifying medical expenses
Expenses that have been paid by you during the tax year to any duly registered –
will be taken into account when the medical allowance is determined, provided that the expenses have been incurred for yourself, your spouse, your children or any dependents.
The expenses may not be recovered from your medical scheme.
Documentary requirements to claim a medical allowance
The following documentation must be retained when a medical allowance is claimed for a tax year:
This article is a general information sheet and should not be used or relied upon as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your financial adviser for specific and detailed advice. Errors and omissions excepted (E&OE)