Know which medical expenses are deductible.
Medical expenses have come with a bit of tax relief in the way of tax credits, a non-refundable rebate, known as the Medical Schemes Fees Tax Credit (MTC). This means that a portion of your qualifying expenses, in this case medical related spend, is converted to a tax credit.
And even if you don’t earn an income, but do contribute a medical aid, you can claim the medical credit through qualifying out-of-pocket expenses.
These include services and medicine supplied by registered medical practitioners, as well as specialists and homeopaths. Expenses for hospitalisation in a registered hospital or nursing clinic and home nursing by a registered nurse, midwife or nursing assistant are also allowed.
The deduction also covers prescribed medicines from a pharmacist and medical expenses incurred and paid outside South Africa, but don’t include over-the-counter medication.
Taxpayers have to be able to provide proof of payment for these expenses during the tax year. The deduction won’t be allowed if it was merely incurred and not also paid during the year.
Moreover, it’s fairly common for the South African Revenue Service (SARS) to request supporting documents for medical expenses during its verification process. Taxpayers will need the income tax certificate from their medical scheme for the period March 1, 2016 to February 28, 2017. And receipts of qualifying medical expenses paid and not recovered from their medical scheme.
If you’re unaware of the medical aid tax credit calculations used to calculate your medical aid tax credit use this handy Medical Aid Tax Credit Calculator https://www.taxtim.com/za/calculators/medical-aid-credits. It will do it all for you in a matter of moments. It will provide a step by step guide on what you need to calculate, and as you fill in the amounts it will tally up the total for you.
