Can I claim a tax medical credit for my child’s remedial needs?

By Kelita Hoffman

Kelita Hoffman is a commercial lawyer and disabilities medical credit expert. As a lawyer and mother to a special needs child, she strives to help fellow parents maximise their financial circumstances in a special needs world. She runs training sessions on navigating medical credits, and often speaks in public, sharing her and her son’s journey. 

Managing a disability – be it yours or a loved one’s – is complex.

For parents of children with disabilities, the day-to-day management, physical strain, emotional stress, and inevitable hypervigilance can be debilitating. Disabilities also come with expenses, and the financial pressure of managing a disability can be extremely taxing (pun intended).

The good news is that you may qualify for claiming a medical tax credit and possibly get a tax refund.

I know what you’re thinking. “Well, this sounds interesting, but my child isn’t disabled, so this article isn’t for us.”

Bear with me.

Disability as defined by SARS

When I use the terms ‘disabled’ or ‘disability’, I’m using them per their tax definition. Section 6B(1) of the Income Tax Act, 1962, defines a disability as 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 it lasts more than a year and if diagnosed by a medical practitioner according to prescribed criteria.

You may be surprised to learn that the above definition includes ADHD, Autism Spectrum Disorder, dyspraxia, dyslexia, dyscalculia and dysgraphia, among others.

This means that tax return time is the time for you to tell SARS about your child’s disability, and the expenses you have incurred as a result. There are several factors to consider, but, in short, you may be entitled to a tax refund. Your medical expenses will be calculated and credited as a medical credit. You read that correctly. SARS may owe you money.

What can be credited?

The medical tax credit is 33,3% of the expense incurred. Although this amount may at first appear small, it still takes a big chunk out of your expenses.

The sum of 33,3% of your school fees will bring significant financial relief – especially if you’re paying a premium for your child to attend a remedial school. You can also claim a medical credit if, for example, your child attends the remedial stream programme at a mainstream school or if your child requires a facilitator.

Other claimable expenses may include sensory items, additional qualifying medical expenses (such as fees for doctors, therapies and medicine), disability modifications, travel expenses to and from school and short-term insurance on items related to a disability (such as hearing aids). Out-of-pocket medical expenses submitted through medical aid may also be claimed.

In short, most expenses incurred as a direct result of the disability can be claimed with limits applying to almost all such expenses.

What supporting documents do I need to submit a claim?

As the saying goes, if you watch the pennies, the dollars will take care of themselves. Keep this at front of mind when collecting your supporting documents. They are absolutely critical, so ensure you have all your ducks in a row before you submit your claim.

1.Medical diagnosis form

An ITRDD SARS medical diagnosis form must be completed by a medical practitioner indicating the disability, as well as its permanence and severity. Common errors by taxpayers include:

· Completing the incorrect sections of the form

· Missing signatures by the medical practitioner

· Not submitting an updated form regularly

2. Supporting financial documents

Ensure invoices and proof of payment for all disability-related expenses are included in your claim. Contracts for caregivers and facilitators must also be included.

3. Comparative school fees

The calculations done on the claimable school fee expense is done as a comparison against non-remedial school fees in your area, so be sure to have a comparative school fee record ready.

Expertise is worth the expense

Although any accountant can technically deal with disability medical credit claims, I have spent many hours advising people who had previously been incorrectly advised by their accountants. Certainly, there is no malintent, but rather limited exposure to this nuanced area of tax law.

This does not mean that your trusted accountant shouldn’t assist you. We can also prepare the disability section of your tax return and then hand it over to your accountant for inclusion in your return.

For more information on what constitutes a disability for tax purposes, or if you require guidance on the relevant documentation and procedures, contact us on 079-502-2200 or visit our website at think-quick.co.za.

This article is based on South African tax legal principles as at the date published and should not be considered legal or tax advice. Please seek advice from a tax professional on the applicability of these principles to you and your unique tax position.