In my new job I am getting a CTC of which only income TAX will be deducted. Previously Medical Aid and Provident Fund was deducted from the CTC then the remainder taxed, as a result I paid less TAX. In the new job I will have to pay med aid and provident after my income has been TAXED. Will I am be able to claim at the TAX year end for this?
Will I be able to get the same amounts as if the amounts where being deducted from the CTC before being TAXED?
Did you previous employer pay medical aid for you? And now you need to pay it yourself?
Same for provident?
Goolamsays: 4 December 2015 at 14:38
It was part of the ctc however the employer removed it off the ctc. So it reflected in the irp 5. Now I would have to contribute personally for an ra as the company does not have a group prov fund. I would also have to fund my medical aid as well. So I would have claim back? The question is will I get the same tax benefit as the provident fund and med aid as before.
TaxTimsays: 7 December 2015 at 12:54
Up until 1 March 2016, employee contributions to a provident fund were not allowable as a deduction and the employer portion was regarded as a tax free fringe benefit - therefore there would have been no tax consequences as a result of the provident fund contributions. Medical aid is not a salary deduction but rather a credit off your total tax payable. You will receive the same tax credit (i.e saving) when you contribute to a medical aid yourself. You will be able to claim for your RA (now paid personally) which will result in a tax saving.
Please make use of our SARS income tax calculator to see the tax you will pay on your new salary (and compare to the prior salary).
Get SARS Tax Dates and Deadlines in your Inbox
We'll tell you when you need to file, along with tax tips and updates.