While waiting for my prescription at the Clicks pharmacy counter, I overheard a conversation at the adjacent stall. The pharmacist asked the customer whether they preferred to charge their purchase to their medical aid or pay in cash. The customer responded, “Just cash because I know my medical aid plan does not cover that type of medicine.”
If you are employed and your medical aid contributions are paid via payroll, your employer may use the Medical Schemes Fees Tax Credit to reduce your monthly tax. On the other hand, if you pay your medical aid premiums in your personal capacity, you are able to claim the tax back as a refund when you file your tax returns.
Under 65 without a disability ADVERTISEMENT: CONTINUE READING BELOW If you fall into this category, the formula used to calculate your additional credits is your total contributions to your medical aid, less 4 x your medical scheme fees credit, plus qualifying medical expenses. Then subtract 7.5% of your taxable income, and multiply this figure by 25%.If you are under age 65 with a disability, your credits are calculated as 33.
However, in order to qualify, the taxpayer or their dependant must qualify with a disability in terms of the Income Tax Act, which describes a disability as ‘a moderate to severe limitation of a person’s ability to function or perform daily activities as a result of a physical, sensory, communication, intellectual or mental impairment’ if the limitation has lasted or has a prognosis of lasting more than a year, and is diagnosed by a duly registered medical practitioner.