Different treatment of disability expenses vs physical impairment expenses?
Important:
This answer is based on tax law for the tax year ending 28 February 2018.
Answer:
Remember that section 18 was deleted from the Act and the matter is now dealt with under section 6B of the Income Tax Act. The principles are, apart from the fact that the one allowed for a deduction and the other (the latter), for a rebate, much the same.
Section 6B(1) of the Act refers to “any expenditure that is prescribed by the Commissioner (other than expenditure recoverable by a person or his or her spouse) necessarily incurred and paid by the person during the year of assessment in consequence of any physical impairment or disability suffered by the person or any dependant of the person.”
According to the same section, a “disability” means a moderate to severe limitation of any person’s ability to function or perform daily activities as a result of a physical, sensory, communication, intellectual or mental impairment, if the limitation—
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has lasted or has a prognosis of lasting more than a year; and
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is diagnosed by a duly registered medical practitioner in accordance with criteria prescribed by the Commissioner.
The SARS guide explains that a person who wishes to claim a medical credit for disability expenses must complete a Confirmation of Diagnosis of Disability form (ITR-DD), which is available on the SARS website (www.sars.gov.za). The ITR-DD needs to be completed and endorsed by a duly registered medical practitioner every five years, if the disability is of a more permanent nature. However, if the disability is temporary, the ITR-DD will only be valid for one year, which effectively means that a new ITR-DD must be completed for each year of assessment during which a disability claim is made.
A duly registered medical practitioner is a person who is registered with the Health Professions Council of South Africa and is specially trained to deal with the applicable disability.
The ITR-DD, with regard to a physical, sensory, communication, intellectual or mental impairment, breaks it up into vision, communication, physical, mental, hearing, intellectual. It also still refers to section 18, but we don’t believe it has any influence on your request or the issue at hand.
There is therefore no difference, between the child with the ITR-DD and the “2 other children who suffer from physical impairment”. Because they last-mentioned two children “have no ITR-DD forms”, they are not “diagnosed by a duly registered medical practitioner in accordance with criteria prescribed by the Commissioner”. For that reason, the expenditure will not be qualifying expenditure.