SUMMARY
| Background The Mr Z (the “Appellant”) was diagnosed with multiple sclerosis and peripheral polyneuropathy. As a result thereof, he claimed medical tax credits in terms of section 6B(1) of the Income Tax Act 58 of 1962 (the “ITA”) for the expenses that he contended he had incurred for treating his disability. The Appellant disputed the disallowance of the additional medical tax credits he had declared claimed in his tax return by The Commissioner for the South African Revenue Service (“CSARS”) (the “Respondent”) in the amount of R89 977.00 (Eight Thousand, Nine Hundred and Seventy-Seven Rand) for the 2015 year of assessment. |
Tax Board After being dissatisfied with the outcome to his objection, the Appellant appealed to the Tax Board. The appeal was heard on 12 July 2016, and on 30 November 2016, the Tax Board delivered its judgement upholding the decision of the Respondent. Further dissatisfied with the outcome, the Appellant approached the Tax Court on 16 March 2017. |
Tax Court Initially, the Appellant consulted with a homeopath and an herbalist, both of whom were not called upon by the Appellant to testify in his favour. The Appellant only relied upon invoices purportedly issued by the abovementioned persons. An investigation undertaken by the Respondent revealed that none of the persons consulted with in respect of the services and treatment for which the Appellant claimed medical tax credits for, were registered with the Allied Professional Health Professions Council of South Africa (the “AHPCSA”). The Appellant was the only person who gave oral evidence during the proceedings before the Tax Court. His testament concerned the investigations which he personally conducted upon himself, and which led him to the conclusion that his disability was caused by mercury poisoning. This prompted him to purchase a ‘X-Machine’ in order to self-treat from a UK-based laboratory. |
| Section 6B(1) of the ITA, stipulates that: – |
| ‘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; |
| ‘qualifying medical expenses’ means – (a) 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 to any duly registered – (i) medical practitioner, dentist, optometrist, homeopath, naturopath, osteopath, herbalist, physiotherapist, chiropractor or orthopaedist for professional services rendered or medicines supplied to the person or any dependant of the person; (ii) nursing home or hospital or any duly registered or enrolled nurse, midwife or nursing assistant (or to any nursing agency in respect of the services of such a nurse, midwife or nursing assistant) in respect of the illness or confinement of the person or any dependant of the person; or (iii) pharmacist for medicines supplied on the prescription of any person mentioned in subparagraph (i) for the person or any dependant of the person; |
| Decision |
The Appellant bore the onus to prove that the amount in dispute was deductible. He failed to present medical reports by a duly registered medical practitioner, homeopath or herbalist to illustrate that his disability was caused by mercury poisoning. The invoices submitted did not constitute affirmative evidence. For that reason, the Appellant was unable to prove compliance with section 6B(1) of the ITA. Further, the X-Machine was neither purchased from a duly registered medical practitioner or homeopath. The Tax Court therefore confirmed and upheld the decision of the Tax Board and granted a cost order against the Appellant.
HELD
| The appeal was accordingly dismissed. The Court held that an invoice cannot serve as evidence of the renderer’s registration as a medical professional. The Court also opined that invoices at most, amount to evidence of the amount charged by the specified service provider for a specific service. The Court further held that the Appellant bore the evidentiary onus to prove that the amount he contested was deductible, and in lieu of calling upon relevant persons to testify in his favour, the Appellant could have submitted affidavits by the relevant persons upon invitation. The Court held also that a self-diagnosis does not meet the requirements of section 6B(1) of the ITA, without it being approved by a duly registered medical practitioner. |
VALUE
| This case highlights the importance of the onus placed upon a party to prove that the amounts contested are in fact deductible as additional medical tax credits. Invoices can never serve as evidence of the renderer’s registration as a medical professional and will never suffice to discharge the onus placed upon a party. |
Further, upon claiming additional medical tax credits, it is essential that professional advice and diagnostics be sought from duly registered professionals in regard to disabilities and medical equipment. A self-diagnosis does not meet the requirement of section 6B(1) of the ITA.
Written by Jayna Hira and Wade Jacobs
