SARS querying out of pocket medical expenses

Author: SAIT Technical

Q: We are receiving requests where SARS queries the amount paid out of pocket on the medical aid tax certificates. Is this really necessary or can we query this with SARS and ask them to stop this, or is there a logic reason behind all of this?

A: In respect of "qualifying medical expenses” the Act requires that these are any amounts (other than amounts recoverable by a person or his or her spouse) which were paid by the person during the year of assessment.  The reason why SARS is asking for proof that the ‘out of pocket’ expenses is, amongst others, most probably to determine whether or not the expenses were in fact paid in the relevant year of assessment.  

In terms of the Tax Administration Act SARS is entitled to request support documents as part of the review of a return.  The taxpayer also bears the onus to prove entitlement to make the deduction.   

We don’t know why SARS requested this in your case, but as they are entitled to do so it may well be irrelevant.  If they request it, one will have to provide it or risk an adjustment to the assessment.  

Disclaimer: Nothing in this query and answer should be construed as constituting tax advice or a tax opinion. An expert should be consulted for advice based on the facts and circumstances of each transaction/case. Even though great care has been taken to ensure the accuracy of the answer, SAIT do not accept any responsibility for consequences of decisions taken based on this query and answer. It remains your own responsibility to consult the relevant primary resources when taking a decision.