Taking medical aid tax credits into account in provisional tax calculation

Nicki says:
23 February 2016 at 15:29

Hi there, I need some help completing my second provisional tax return. My employer deducts my medical aid tax credits (for myself and a dependent) each month on my payslip. Therefore, on my payslip each month is my gross earnings less my deductions (of which the medical aid tax credit is subtracted from the monthly PAYE amount due). However, at the bottom of my payslip, where it shows total tax paid to date figures, the amount here is the PAYE amount, BEFORE deducting any medical aid tax credit. My question is now when I submit my provisional tax return, do I enter the medical aid tax credits in the section provided for?
And then when I have to state the amount of employees tax already paid for the 12 months period - is this the amount of PAYE before (ie. "gross"PAYE) or after deducting the medical aid tax credit?

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TaxTim TaxTim says:
23 February 2016 at 15:31

You would enter the amount of credits and then amount actually paid in PAYE.

Nicki says:
23 February 2016 at 15:36

Thanks so much for the quick response!
Just to clarify, the amount actually paid in PAYE would be the PAYE less med aid credit? Not the year to date PAYE paid as reflected on my payslip?

TaxTim TaxTim says:
23 February 2016 at 15:37

You would take the PAYE that was paid because this gets credited against your taxes owing after taking into account the medical credit.

Nicki says:
23 February 2016 at 15:56

I am so sorry but it is still not clear to me.
The amount of PAYE that is physically paid to SARS is after taking off the medical aid tax credit.

So for example:
PAYE = R2000
Tax credit = R270
Physically paid over to SARS = R1730.

So on my second provisional tax return:
Under medical aid tax credits I will enter R270 x 12 = R3,240
and under Employees tax already paid = R2,000 x 12 = R24,000 OR R1,730 x 12 = R20,760?

TaxTim TaxTim says:
23 February 2016 at 22:59

You would put the amount actually paid to SARS which is the PAYE which was paid. So you would put the R20 760 in your example otherwise you would be double counting.

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