I am a provisional tax payer aged 77 and the IRP6 form asks for the tax credit rather than the medical aid contributions.
As I understand it, the standard tax credit is R 540 per month. Therefore with my wife, the standard tax credit is 540 x 2 x 12 per year = R 12 960. I pay R 3 000 per month in subscriptions i.e. R 36 000 per year. I pay R 36 000 - 12 900 = R 23 040 in excess of the standard tax credit and I am allowed an extra tax credit equal to 1/3 of this amount, i.e. R 23 040 / 3 =R 7 680. Therefore my total tax credit is made up of R 12 960 (Standard tax credit) + R 7 680 (for the excess) = R 20 640. In addition I am allowed a tax credit of 1/3 of my out of pocket expenses. Please confirm or point out my error. Thank you
TaxTimsays: 30 March 2015 at 17:32
The tax credit per month for the 2015 tax year was R257 per month so your amount would be R257 x 2 x 12 = R6168
You would then take the ((R36 000 - (3x6168)) *1/3 = R5 832 which is your excess.
Therefore your total credit is R6168 + R5 832 = R12 000
Popsiesays: 31 March 2015 at 1:21
TaxTimsays: 1 April 2015 at 10:18
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