Issue link: https://www.hub.camaf.co.za/i/984824
Guide on the Determination of Medical Tax Credits (Issue 9) 11 Example 11 – Non-prescription medicine Facts: BC purchased headache tablets off-the-shelf at the local pharmacy for R50. Result: As the headache tablets were not prescribed by a duly registered medical practitioner, nor was the expense prescribed by the Commissioner in consequence of a physical impairment, the R50 is not regarded as a "qualifying medical expense" and will not be taken into account when the AMTC is determined. 3.3.2 Expenditure incurred outside the Republic Expenses for medical services and supplies that have been incurred outside South Africa 17 may be taken into account in the determination of the AMTC during a year of assessment if they – • have been paid during that year of assessment, and • are substantially similar to qualifying medical services rendered or medicines supplied in South Africa. 3.3.3 Qualifying disability expenditure Only expenditure prescribed by the Commissioner and which is necessarily incurred and paid for by the taxpayer in consequence of a disability, qualifies for an AMTC under section 6B, but is subject to certain limitations. These expenses are set out in the List of Qualifying Physical Impairment or Disability Expenditure, published by SARS on 1 March 2012 (see Annexure B). A "disability" 18 means – a moderate to severe limitation of a person's ability to function or perform daily activities as a result of a physical, sensory, communication, intellectual or mental impairment, if the limitation— (a) has lasted or has a prognosis of lasting more than a year; and (b) is diagnosed by a duly registered medical practitioner in accordance with criteria prescribed by the Commissioner. The expense must be in consequence of a disability suffered by the taxpayer or any dependant of the taxpayer. The expense will only qualify if it was necessarily incurred and paid by the taxpayer. 19 The terms "necessarily incurred" and "in consequence of" are not defined in the Act; therefore, they retain their ordinary meaning. "Necessary" is defined as "required to be done…needed", while "consequence" is defined as "a result or effect; as a result". 20 In their context within the Act, these phrases mean that there must be a direct link between the 17 Section 6B(1), definition of "qualifying medical expenses" paragraph (b). 18 Section 6B(1). 19 Section 6B(1), definition of "qualifying medical expenses" paragraph (c). 20 Concise Oxford English Dictionary. Edited by Catherine Soanes and Angus Stevenson. 11 th ed. Oxford University Press.