Taxpayer, who is not the main member of the medical aid, pays expenses for child who has Cerebral Palsy (Physical Disabled). Where on the ITR12 can these expenses be reflected? Codes 4034 and 4023 state "other than disability". Code 4022 is for "Physical
Important:
This answer is based on tax law year ending 28 February 2017.
Answer:
In terms of section 6B(3) of the Income Tax Act, the amount of the additional medical scheme fees tax credit must be … where the person, his or her spouse or his or her child is a person with a disability, the aggregate of –
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33,3 per cent of so much of the amount of the fees paid by the person to a medical scheme or fund contemplated in section 6A(2)(a) as exceeds three times the amount of the medical scheme fees tax credit to which that person is entitled under section 6A(2)(b); and
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33,3 per cent of the amount of qualifying medical expenses paid by the person …
The emphasis is on the ‘paid by the person’ (and that would be the taxpayer in this instance).
Remember that a person who wishes to claim the credit for disability expenses must complete a Confirmation of Diagnosis of Disability form (ITR-DD). Part B of the ITR-DD must be completed by a duly registered medical practitioner who is qualified to express an opinion regarding the person’s disability. The practitioner needs to complete the appropriate diagnostic criteria.
In Part C of the ITR-DD the registered medical practitioner must –
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indicate and describe if the functional limitations with respect to performing activities of daily living are regarded as either “mild” or “moderate to severe”;
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indicate if the disability has lasted, or is expected to last for a continuous period of more than 12 months; and
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sign the declaration.
We assumed that the child may well be “a person with a disability”. You now mentioned ‘cerebral palsy’. The SARS Guide on the Determination of Medical Tax Credits (Issue 10 and on page 14) it is stated, under ‘Physical’, that a person is regarded as a person with a disability if the impairment is such that the person is
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unable to walk, for example, a wheelchair user;
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only able to walk with the use of assistive devices, for example, callipers, crutches, walking frames and other similar devices;
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able to walk without the use of assistive devices, but with a degree of difficulty, for example, persons with Cerebral Palsy, Polio (that is, persons who require an inordinate amount of time to walk); and
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functionally limited in the use of the upper limbs.
The guide then lists, as the registered medical practitioners, who can complete the ITR-DD:
Orthopaedic surgeon, neuro surgeon, physiotherapist or occupational therapist.
The guide then gives examples of the expenses that would qualify.
From this, we submit that it is code 4023 that must be used where the child is someone with a disability.