As tax season approaches, we reshare important information on preparing for the tax season.

The dates for the 2024 filing season are:

• Auto-assessment notices: 1 July 2024 to 14 July 2024
• Individual taxpayers (non-provisional): 15 July 2024 to 21 October 2024

Minister of Finance, Mr Enoch Godongwana, during his Budget Speech on 21 February 2024, confirmed that the Medical Scheme Fees Tax Credit (MTC) will remain for this tax year. The tax year commenced on 1 March 2024, and the monthly rebates for medical scheme contributions are as follows:

• Taxpayer: R364
• First dependant: R364
• Every subsequent dependant: R246

It is important to understand how this rebate works; it is non-refundable and used to reduce a person’s normal tax. Remember that an employer is obligated to adjust the monthly PAYE deductions by the medical tax credit, and therefore, employees would have already received the medical tax credit during the year if the medical scheme premium is deducted via payroll. Additionally, it follows that these tax credits are thus applicable to taxpayers only.

We encourage South African taxpayers to prepare their relevant financial and supporting documentation to facilitate a smooth filing process. With this in mind, it is important to take note of the following dates:

• The deadline (closing date) for non-provisional taxpayers is 23 November 2024.
• Taxpayers who file online have until 24 October 2024 to submit their return.
• Employers are required to issue employee tax certificates (IRP5/IT3(a)) by 31May 2024.
• Medical Scheme Tax Certificates are usually available from the last week of May and will be shared by your medical scheme. If you have not received your certificate, please contact your medical scheme provider or healthcare intermediary for assistance.

Understanding additional claimable expenses for medical scheme members

The Additional Medical Expenses Tax Credit (AMTC) is a non-refundable rebate and is used to reduce the normal tax a person pays, similar to the MTC. This rebate is calculated against the qualifying out-of-pocket medical expenses that an individual who belongs to a South African registered medical scheme incurred. If you submit all your medical expenses to your medical aid, this amount is normally reflected on the tax certificate from the medical aid as ‘claims not paid’, and you will not need to calculate this yourself when submitting your taxes. Here is a list of qualifying medical expenses:

• Services rendered and medicines supplied by any duly registered medical practitioner, dentist, optometrist, homoeopath, naturopath, osteopath, herbalist, physiotherapist, chiropractor or orthopaedist.
• Hospitalisation in a registered hospital or nursing home.
• Home nursing by a registered nurse, midwife or nursing assistant, including services supplied by any nursing agency.
• Medicines prescribed by any duly registered medical practitioner and acquired from any duly registered pharmacist.
• Expenditure incurred outside South Africa in respect of services rendered or medicines supplied which are substantially similar to the services and medicines listed above.
• Any expenses prescribed by the Commissioner and incurred because of any physical impairment or disability.

The calculation of the AMTC rebate is fairly complex; it is based on the individual’s taxable income, and there are qualifying categories such as insured persons 65 years and older, insured persons/spouses or children with a disability or persons under 65 with no disability. Please click on this link, or you can access the details of the calculation at www.sars.gov.za.

Paying medical scheme contributions for third parties

When a taxpayer is paying scheme contributions from their personal bank account for a spouse or parents who are not on the same membership, they can include this as part of their SARS return. If SARS requests proof, a medical aid contribution certificate from the medical scheme will be required with proof of payment, as well as a letter indicating the reason you’re making payment where you’re not the main member and whether the spouse or parents are financially dependent on you.

Medical Insurance

This type of insurance is not registered as a medical scheme in South Africa and does not qualify for the above medical tax and additional medical tax credits.

It is advisable to seek out professional tax advice from a registered tax practitioner when filing your returns.