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Employer pays medical aid - put this under 3810, 4005 and 4474?

Posted 3 December 2012 under Tax Questions



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I just wanted to confirm that if an EMPLOYER pays all medical aid subscriptions does one list this amount paid by the EMPLOYER under codes 3810 & 4005 & 4474?

So in effect one would have the normal salary under code 3601 and then under code 3810 the FULL medical subs paid by EMPLOYER and then list this SAME amount under codes 4005 and 4474.
Is this correct?

Also does one need to use 4116 to show the tax credit of R230 x 6 or 12 depending on if it is the annual IRP5 cert or the bi-annual certificate?

I look forward to your feedback :)

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TaxTimTaxTim says:
4 December 2012 at 10:55

You are correct, normal salary - so the amount unrelated to medical under code 3601 and then all the medical amounts under 3810, 4005 and 4474. You will then see there is a net cash outflow of the 4005 amount. For tax purposes though there is a Fringe Benefit for the whole amount under income.

For the 4116 - You would show the relevant months because you have only taken off the 6 months in the case of the bi-annual. The Medical Tax Credit is on a monthly basis and reduces the PAYE paid over so you would not have done so on the bi-annual certificate yet.

I hope this helps!


Chris says:
5 December 2012 at 9:58

Hi Tim

Thank you so much for the reply.

So if I understand you correctly 3601 would reflect the normal salary WITHOUT medical aid included and then codes 3810, 4005 & 4474 would all have the SAME rand value as this is what the EMPLOYER paid to the medical aid.







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