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Claiming of medical tax credit in the 2026 tax-year
By Mahomed Kamdar, Tax Specialist: Independent CIBA Consultant
SARS has issued its latest guide on the claiming of medical tax credits on the 15th of June 2026.
Below is a simplified summary of the key principles relating to the claiming of medical tax credits based on the latest SARS Guide.
The synopsis of the new Guide
1. Who qualifies to claim for the medical scheme fees tax credit?
Available only for contributions paid to a registered medical scheme (or qualifying foreign equivalent).
Contributions qualify only if paid for:
- the taxpayer; and/or
- qualifying dependants.
Dependants include:
- spouse;
- children;
- family members for whom the taxpayer has a legal duty of support; and
- persons recognised as dependants by the medical scheme.
Contributions do not qualify if paid to:
- health insurance products;
- gap cover policies;
- unregistered medical funds.
Available only for contributions paid to a registered medical scheme (or qualifying foreign equivalent).
2026 tax year medical tax credit monthly amounts:
- R364 – taxpayer only;
- R728 – taxpayer plus one dependant (or two dependants);
- R246 – each additional dependant.
The MEDICAL TAX CREDIT:
- cannot exceed tax payable;
- taxpayer cannot create a refund; and
- cannot be carried forward.
If more than one pays contributions, the medical tax credit must be apportioned proportionately.
Calculation:
- Medical tax credit is limited to 25% of qualifying amounts exceeding 7.5% of taxable income.
2. Additional Medical Expenses Tax Credit
Additional medical expenses tax credit provides relief for qualifying out-of-pocket medical expenses and certain excess medical contributions.
Three taxpayer categories apply:
- Taxpayers 65 years and older
- Taxpayer, spouse or child with a disability;
- Taxpayers below 65 years
Qualifying expenses generally include payments to registered:
- medical practitioners;
- hospitals;
- nurses;
- pharmacists (prescribed medicine only).
Expenses only qualify if they are:
- actually, paid during the year of assessment; and
- not recoverable from a medical scheme, insurer, or medical savings account.
For more details on payment of medical expenses read our previous article: The case for reliable, credible and authentic evidence in resolving tax disputes.
Medical expenses incurred outside South Africa may qualify if substantially similar to qualifying South African medical services.
3. Disability and Physical Impairment Rules
Additional qualifying expenditure exists for expenses incurred due to a disability, provided:
- the disability is moderate to severe;
- expected to last more than one year; and
- confirmed by a registered medical practitioner.
- the expense must be:
- o necessarily incurred; and
- o directly linked to the disability.
- Disability claims require completion of the ITR-DD (Confirmation of Diagnosis of Disability) form. The form must be completed by the medical practitioner and taxpayer. The form must not be completed by the tax practitioner. The form must be
- o retained by the taxpayer (not submitted with the return); and
- o may remain valid for up to 10 years if permanent.
- Physical impairment claims may also qualify but are generally subject to stricter limitations than disability claims.
4. Additional medical expenses tax credit calculation
- Taxpayers aged 65+ receive 33.3% of qualifying excess contributions and qualifying medical expenses.
- Taxpayer/spouse/child with disability: same 33.3% approach applies.
5. Administrative requirement
- Claims are generally made through the income tax return process.
- Supporting records, proof of payment and disability documentation must be retained.
- Taxpayers may object if credits are disallowed.
6) Declaration alert questionnaire
The major innovation introduced for the 2026 filing season is the Declaration Alert Questionnaire.
This questionnaire enables taxpayers to provide explanations for certain transactions disclosed in their tax returns in advance. Specific types of transactions may trigger the issuance of the questionnaire, allowing taxpayers to furnish relevant information upfront and thereby facilitating the assessment process.
Hypothetical examples of circumstances in which an alert questionnaire may be triggered are set out below. This list is illustrative only and should not be regarded as exhaustive.
Example 1
A taxpayer pays the medical aid contributions on behalf of elderly, unemployed parent and claims the applicable medical scheme fees tax credit when submitting the income tax return. SARS may not have sufficient information to verify the claim, as the medical aid statement is issued in the parent’s name rather than the taxpayer’s name.
However, the taxpayer is able to demonstrate that the contributions were paid from his or her own bank account. In these circumstances, an alert questionnaire may be triggered, allowing the taxpayer to explain the transaction and submit supporting documentation at an early stage of the assessment process.
By providing the explanation and supporting evidence upfront, the taxpayer may avoid the need for a subsequent verification or audit relating to the transaction.
Example 2
When submitting a tax return, a taxpayer indicates that he or she has sixteen medical aid dependants during the current year of assessment. The eFiling system may flag this as a potential anomaly because, in the previous year of assessment, the taxpayer reported only six dependants.
In reality, the discrepancy may simply be the result of a data-capturing or typing error. An alert questionnaire may therefore be triggered, providing the taxpayer with an opportunity to explain the discrepancy and confirm that the incorrect number of dependants was entered inadvertently.
By allowing the taxpayer to clarify the issue immediately, the assessment process can proceed more efficiently and the need for a subsequent verification or audit may be avoided.
Note well:
Not all transaction will trigger an alert questionnaire. The SARS AI system will automatically identify which transactions requires clarity.
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