Physical Impairment or Disability Expenditure

Reference Acts and Documents
Section 6B(1) of the Income Tax Act 58 of 1962

In this article we look at a recent document published in May 2021 by SARS for public comment: “LIST OF QUALIFYING PHYSICAL IMPAIRMENT OR DISABILITY EXPENDITURE”. A few definitions will be listed for the sake of clarity too.

The term “disability” is defined in section 6B(1) of the Act as follows:

“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:

(a) has lasted or has a prognosis of lasting more than a year; and
(b) is diagnosed by a duly registered medical practitioner in accordance with criteria prescribed by the Commissioner.

The term “physical impairment” is not defined in the Act. However, in the context of section 6B of the Act it has been interpreted as a disability that is less restraining than a “disability” as defined. This means the restriction on the person’s ability to function or perform daily activities is mild.

Qualifying medical expenses

Paragraph (c) of the definition of “qualifying medical expenses” in section 6B(1) of the Act refers to 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.

Dependant

For purposes of section 6B of the Act, the term “dependant” means a person’s spouse; a person’s child (or child of his or her spouse); any other member of a person’s family in respect of whom he or she is liable for family care and support; and any other person who is recognised as a dependant of that person in terms of the rules of a registered medical scheme or similar foreign fund at the time that the qualifying medical expenses were necessarily incurred and paid.

Additional medical expenses tax credit

Disability

Under section 6B(3)(b) of the Act, a taxpayer who has or whose spouse or child has a “disability” as defined (that is, in accordance with criteria prescribed by the Commissioner for SARS in the ITR-DD form), will be able to claim qualifying medical expenses (inclusive of VAT) under section 6B of the Act as an additional medical expenses tax credit. The additional medical expenses tax credit equals 33% of the aggregate of:

• qualifying medical expenses paid by the person; and
• medical scheme fees as exceeds three times the medical scheme fees tax credit as calculated under section 6A of the Act.

Physical impairment

Under section 6B(3)(c) of the Act, a taxpayer who has or whose dependant has a physical impairment that is not a “disability” as defined, will be able to claim qualifying medical expenses (inclusive of VAT) under section 6B of the Act as an additional medical expenses tax credit.

The additional medical expenses tax credit equals 25% of the aggregate of:
• qualifying medical expenses paid by the person; and
• medical scheme fees in excess of four times the medical scheme fees tax credit as calculated under section 6A of the Act, as exceeds 7,5% of the person’s taxable income (excluding taxpayers 65 years and older, who would be entitled to an additional medical expenses tax credit as provided for in the Disability section above).

For the purposes of this article, only a couple examples will be looked at to prevent a very lengthy article.

A. PERSONAL CARE ATTENDANT EXPENSES

Expenditure prescribed by the Commissioner under this category is as follows:

  1. A salary paid to a person who is employed solely to care and look after the needs of a person with a disability.

Note: If the person is employed on a full time basis to perform housekeeping activities, the salary paid to such person will not qualify.

  1. Living-in expenses for a live-in personal care attendant, which is limited to the additional cost of electricity, water and food as a result of a live-in personal care attendant, is deemed to be 20% of the “national minimum wage” as defined in the National Minimum Wage Act 9 of 2018.
  2. If more than one live-in personal care attendant is employed on a full time basis at the same time, the amount which can be claimed may not exceed 20% (per personal care attendant) of the “national minimum wage” as defined in the National Minimum Wage Act 9 of 2018.

Note:

• A “spouse” as defined in section 1(1) of the Act, and your or your spouse’s parents or grandparents are not regarded as personal care attendants for the purposes of this list.

• If the live-in personal care attendants are only present on alternate days, the living-in expenses are limited to one live-in personal care attendant.

  1. Cost of training a personal care attendant or a family member to take care of a person with disability. This refers to relevant courses or training undergone by a personal care attendant or family member who will care for a person with a disability. The cost must be paid to a service provider that is in the business of providing such training.
  2. Accommodation expenses paid for a personal care attendant for the purposes of training under 4 above or business and holiday travel of the person with a disability.
  3. Accommodation expenses for the purposes of training referred to under paragraph 4 for a family member.

B. INSURANCE, MAINTENANCE, REPAIRS AND SUPPLIES

Expenditure prescribed by the Commissioner under this category is:

Insurance, maintenance, repairs and supplies (including batteries), only in respect of qualifying goods that fall under this list.

Note: The qualifying goods insured must be specified in the insurance policy.

C. PROSTHETICS

Expenditure prescribed by the Commissioner under this category is:

Cost of prosthetic limbs (including custom-made braces for limbs and woven or elasticised stockings).

D. AIDS & OTHER DEVICES

Expenditure prescribed by the Commissioner under this category is as follows:

  1. 50% of the cost of an air conditioner, heater, fan, and environment control system (computerised or electronic) to prevent hypothermia or hyperthermia for a person with spinal cord injury (termed as a paraplegic, quadriplegic or tetraplegic).
  2. Computer devices and related equipment (for example, track ball) including the software to operate such devices, required by a person with a disability due to a moderate to severe impairment in hand function or visual ability.
  3. Cell phone applications required by a person with a disability due to a moderate to severe impairment in visual or hearing ability (note that this excludes the actual cost of the cell phone).
  4. Computer software or other electronic equipment required in order to convert printed material or image files into text, Braille, speech or any other accessible format, including peripheral equipment such as scanners and Braille printers.
  5. Converted, printed and graphical material, including talking, Braille and large print textbooks and maps or drawings for a person with a disability.
  6. Helmets (protective gear) used by persons with epilepsy to prevent injury, especially head injuries during seizures.
  7. Home assistive tools (without which performing a task would not be possible) that enable a person with a disability to perform tasks of daily living.

Examples:

• Utensil hand-clip eating aid for persons who struggle to grasp and hold small utensils; reaching aids that assist a person to grasp hard-to-reach items more easily.
• Adhesive bump dots used to differentiate settings on, for example, home appliances like an oven.

  1. Magnification and image-enhancement devices that enable a person to read, such as optacons, large-screen computer monitors, magnifiers, video magnifiers, CCTV readers, video goggles, electronic magnifiers (that plug into a computer, monitor or TV) and telescopic spectacles.
  2. Mobile ramps and tie-downs used to assist wheelchair users to move in and out of vehicles or buildings that have no ramps.
  3. Mobility aids, including wheelchairs, wheelchair carriers, crutches and walking frames.
  4. Bathroom aids to help a person in or out of a bath or shower or to get on or off a toilet.
  5. Navigation aids, including white canes, sonic or obstacle learning (echolocation) devices and hand-held talking GPS devices and related software required by a person with a moderate to severe visual impairment.
  6. Orthopaedic shoes, boots and inserts, including braces, as well as standard shoes and boots used by a person who walks with an unsteady gait when not using such aid.
  7. Page-turning devices used to assist a person to turn the pages of a book or other bound document where the disability moderately or severely restricts their ability to use arms or hands.
  8. Prescription spectacles and contact lenses will qualify to the extent that these amounts have not been recovered from a medical scheme.
  9. Pressure care mattresses and body positioners to prevent pressure sores and correct postural alignment for persons with a spinal cord injury.
  10. Signalling devices – emits light instead of sound (for example, light emitting doorbell).
  11. Amplification, loop systems specifically designed to assist hearing and other assistive listening devices to be used by a person who has a hearing impairment (including related accessories).
  12. Money templates used to differentiate between various denominations of notes and coins.
  13. Speech-generating devices and communication boards that enable a person to communicate, including a relevant keyboard for a person with a moderate to severe speech impairment. Specialised anti-glare and flicker-free screens – for televisions and computers used by a person with photosensitive epilepsy to minimise exposure to seizures. This includes laryngectomy speaking valves and accessories.
  14. Talking, sound-making and vibrating devices that enable a person to perform daily tasks.

For example, talking calculators, adapted watches and clocks, shake awake alarms, talking kitchen scales, light detectors and liquid level indicators etc.

  1. Seizure alert devices (for example, mattress sensor alarms, watch devices, anti-suffocation pillows, seizure alert cameras), excluding standard camera devices.
  2. Teletypewriters or similar devices required by a person with a hearing impairment to make or receive phone calls where the impairment is moderate to severe.
  3. Television closed-caption decoders or readers required by a person with a moderate to severe hearing or visual impairment.
  4. Word-to-text devices – for a person with a disability that causes a moderate to severe impairment in hand functions; or visual or hearing impairments as experienced by some persons with Cerebral Palsy.
  5. Toilet seats, bath seats, shower seats or commode chairs specially designed for use by persons with a physical disability.
  6. Lifts to move persons with physical disabilities.
  7. Grab rails or hoist placed in such a way as to aid a person with a physical disability.
  8. Stair chairs specifically installed to aid a person with a physical disability.

Note: The cost of electricity needed to operate these devices will not be a qualifying expense.

Author Craig Tonkin

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