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R3783 code 4008 on ITR12

Posted 27 June 2013 under Tax Questions


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How is code 4008 calculated for 4 members under medical scheme? I understand there is a maximum amount but R3783 doesn't seem right?

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TaxTimTaxTim says:
27 June 2013 at 19:46

It would be R230 x 12 x 2 and R154 x 12 x 2 for the 2013 tax year = R9456 limited to your actual contribution.


Desiree says:
27 June 2013 at 22:27

Dear Tim, thanks very much for your reply. I was just wonsering if it should not be R720 x 2 x 12 and is it R440 for each dependant after that?

If your calculation above is based on the latest formula, should the amount of R9456 not be allocated to code 4008 in stead of the R3783 as shown on our tax calculation? Total deductible amount is R60814.

Much appreciated


TaxTimTaxTim says:
27 June 2013 at 22:59

The R720 and R440 you are referring to relates to the 2012 tax year and is in the form of a deduction. For the 2013 tax year a credit system was put in place, as per the calculation above, which reduces the tax payable after it has been calculated whereas the deductions get taken off before the tax is worked out.


Desiree says:
27 June 2013 at 23:05

Thank very much for explaining, I really appreciate your help. It makes sense now looking at the figures,
Regards


TaxTimTaxTim says:
27 June 2013 at 23:08

Only a pleasure!


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