CAMAF Member Option Guides & Info

Guide on the Determination of Medical Tax Credits (Issue 9) 22 The AMTC for disability may only be claimed if the taxpayer, his or her spouse, or his or her child is disabled. 39 An AMTC in respect of disability is not available if dependants other than the taxpayer, his or her spouse, or his or her child are disabled – such as a parent. In cases where the AMTC is claimed for such dependants, the expenses incurred and paid will be considered, but will be subject to the 7,5% limitation 40 as discussed in 3.6.3. 3.6.3 Taxpayers under the age of 65 without a disability In addition to the MTC, a taxpayer who is under 65 years of age will be entitled to an AMTC that is limited to 25% of the amount by which the sum of the amounts listed below exceeds 7,5% of the taxable income (excluding retirement fund lump sum benefits, retirement fund lump sum withdrawal benefits, and severance benefits) 41 before taking into account this AMTC: (i) All contributions made by the taxpayer to a registered medical scheme (in respect of the taxpayer, his or her spouse and any dependant) that exceeds four times the MTC; and (ii) Actual qualifying medical expenses (including physical impairment expenses) paid by the taxpayer and not recoverable from the medical scheme in respect of the taxpayer, his or her spouse or child and any dependant. In (ii) above, the following expenses must be taken into account in the determination of the AMTC: • All qualifying out-of-pocket medical expenses relating to services and prescribed supplies; and • Expenses relating to a physical impairment (if applicable). To simplify this calculation, the following formula can be used: 25% × {[A – (4 × B)] + C] – (7,5% × D)} in which formula— "A" represents fees paid to a medical scheme or fund for the year of assessment; "B" represents the MTC for the year of assessment; "C" represents all qualifying medical expenses paid during the year of assessment; and "D" represents taxable income (excluding any retirement fund lump sum benefit, retirement fund lump sum withdrawal benefit and severance benefit). 39 Section 6B(3)(b). 40 Unless the taxpayer is 65 years of age or older, where the 7,5% limitation will not apply. 41 Section 6B(3)(c).

• Cover
• Preface
• Glossary
• 1. Background
• 2. Part A – Section 6A rebate (medical scheme fees tax credit)
• 2.1 Qualifying persons for whom contributions may be claimed
• 2.1.1 Meaning of a "dependant"
• 2.2 Person paying the contributions
• 2.2.1 Contributions paid by the taxpayer
• 2.2.2 Qualifying contributions
• 2.3 Medical scheme fees tax credit
• 2.4 Amount of medical scheme fees tax credit to be deducted from tax due
• 3. Part B – Section 6B rebate (additional medical expenses tax credit)
• 3.1 Background
• 3.2 Qualifying persons for whom expenses may be claimed
• 3.2.1 The meaning of "dependant"
• 3.2.2 The meaning of "spouse"
• 3.2.3 The meaning of "child" for purposes of the additional medical expenses tax credit
• 3.3 Qualifying medical expenses
• 3.3.1 Expenditure incurred inside the Republic
• 3.3.2 Expenditure incurred outside the Republic
• 3.3.3 Qualifying disability expenditure
• (a) Prescribed diagnostic criteria for a disability
• (b) Confirmation of disability (ITR-DD form)
• 3.3.4 Expenses relating to a physical impairment
• 3.4 Timing of claim for qualifying medical expenses
• 3.5 Contributions and qualifying medical expenses deemed to be paid by the taxpayer
• 3.6 Amount of additional medical expenses tax credit to be deducted from tax due
• 3.6.1 Taxpayers aged 65 years and older
• 3.6.2 Taxpayers with a disability
• 3.6.3 Taxpayers under the age of 65 without a disability
• 4. How to claim the medical scheme fees tax credit and additional medical expenses tax credit
• 4.1 Persons registered for income tax
• 4.2 Persons not registered for income tax
• 5. How to object to the disallowance of an medical scheme fees tax credit or additional medical expenses tax credit
• 6. Other information
• 6.1 Relief of customs and excise duty on a motor vehicle adapted for a physically disabled person
• Annexure A – The law
• Annexure B – The prescribed list of expenditure