Claiming medical expenses with SARS for a third party, such as a parent, sibling, or in-law who is not on your medical aid, involves a specific process. Here’s a step-by-step guide to help you navigate the process and ensure you can claim these expenses correctly:
### 1. **Understand the Eligibility Criteria**
**Qualifying Dependents:**
SARS allows taxpayers to claim medical expenses for dependents who are family members and financially dependent on the taxpayer. This includes:
– Parents or parents-in-law
– Siblings or siblings-in-law
– Children, including adopted or stepchildren
To claim these expenses, you need to demonstrate that you are financially supporting the individual and that the expenses are directly related to their medical needs.
### 2. **Gather Necessary Documentation**
**Proof of Relationship and Financial Support:**
– **Affidavit:** A sworn affidavit stating the relationship and the financial dependency of the third party on you.
– **Financial Records:** Evidence showing financial support, such as bank statements or money transfer receipts.
**Medical Expense Documentation:**
– **Invoices and Receipts:** Original invoices and receipts for all medical expenses paid. These should detail the services provided and the amounts paid.
– **Medical Reports:** Any medical reports or prescriptions supporting the necessity of the medical treatment.
### 3. **Keep Records of Payments**
Ensure you have clear records showing that you paid the medical expenses. This could include:
– Bank statements showing payments made directly to healthcare providers.
– Receipts in your name for cash payments made.
– Any correspondence with medical service providers or pharmacies that confirm payments made.
### 4. **Filling Out the Tax Return**
**Access the ITR12 Form:**
– Log in to SARS eFiling and access the ITR12 income tax return form.
**Complete the Medical Expenses Section:**
– Navigate to the section for “Medical Deductions” on the ITR12 form.
– Enter the total amount of qualifying medical expenses paid for the third party under “Amounts Not Refunded by Medical Scheme.”
### 5. **Specify Third-Party Medical Expenses**
**Details of Expenses:**
– In the section for additional information, specify that the medical expenses were incurred for a third party. Provide details such as the name of the third party, their relationship to you, and their financial dependency status.
– Attach the supporting documentation, including the affidavit, financial records, and medical receipts.
### 6. **Calculate the Deductions**
**Qualifying Medical Expenses:**
– SARS allows you to claim for “out-of-pocket” medical expenses not covered by your medical aid. These include consultations, treatments, medications, and medical devices.
**Additional Medical Expenses Tax Credit (AMTC):**
– The AMTC provides additional relief for medical expenses that exceed a certain threshold. This threshold depends on your age, disability status, and taxable income.
– Calculate the total medical expenses and apply the AMTC formula to determine the additional tax credit you can claim.
### 7. **Review and Submit**
**Review Entries:**
– Carefully review all the information entered on your tax return to ensure accuracy. Double-check the amounts and the details of the third-party medical expenses.
**Submit the Return:**
– Once you are confident that everything is correct, submit your tax return via SARS eFiling.
### 8. **Respond to SARS Queries**
**Follow-Up Requests:**
– SARS may request additional documentation or clarification regarding the medical expenses claimed. Respond promptly to any queries and provide the necessary documentation.
**Maintain Records:**
– Keep all records and documentation for at least five years. This includes the affidavit, financial records, medical receipts, and any correspondence with SARS.
### 9. **Monitor Your Assessment**
**ITA34 Notice of Assessment:**
– After submission, you will receive an ITA34 Notice of Assessment from SARS. Review this document to ensure that the medical expenses claim has been correctly processed.
**Rectify Discrepancies:**
– If there are discrepancies or if the claim has not been allowed, you may need to file an objection or provide further supporting evidence.
By following these steps and ensuring all necessary documentation is accurate and complete, you can successfully claim medical expenses paid for a third party who is financially dependent on you. Proper record-keeping and accurate reporting will help maximize your allowable deductions and ensure compliance with SARS regulations.