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Here's how to treat medical aid contributions for employees over 65

by , 24 July 2014
Did you know that from the 2015 tax year (March 2014 to February 2015), the way you deduct your medical expenses, including your medical aid contributions, changed?

It's true.

One of the changes relates to the treatment of medical aid contributions for employees over 65.

Continue reading to find out the correct way to treat medical aid contributions if your employees are over 65 so you can get it right and avoid SARS penalties.

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Here's how to treat medical aid contributions if your employees are over 65


The Practical Tax Loose Leaf Service explains that previously, if you had employees who were 65 years and older, their medical aid contributions and medical expenses were deducted in full. This means they didn't pay Pay As You Earn (PAYE) on their medical benefits on a monthly basis.
 

Things have changed a bit.
 

Now, you treat their medical aid contributions exactly the same way as the rest of your employees when you calculate their monthly PAYE. They'll only qualify for the SARS medical tax credit amounts per month.
 

But, employees 65 and older, can still place a no value on any medical qualifying expenses that you pay as an employer. So this part stays the same when you calculate PAYE.
 

It's that simple to deal with medical aid contributions for employees over 65.
 

Now that you know how to treat medical aid contributions for employees over 65, make sure you get it right and avoid SARS penalties.
 

Lookout for our next article on this topic – experts behind the Practical Tax Loose Leaf Service will give you a practical example of how to treat medical aid contributions if your employees are over 65 so you'll know exactly what to do.


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