Medical aid contributions on IRP5 different from medical aid certificate

[J7J]

Hi,

Why would the contributions made to the medical aid on the IRP5 next to codes 4474 and 4005 be different from the contributions made to the medical aid as per the medical aid certificate?

What do I do with this difference (if anything)?

Thanks!

[J7J]

The person that prepared the IRP5 for the individual concerned, said that this happens very often, as the payroll administrator is not always made aware of changes in the contributions to medical aids and prepares the payroll with the incorrect amounts. (In the case I am talking about, the individual's IRP5 stated a lower value for the medical aid contributions compared to the medical aid certificate.)

The person that prepared the IRP5 for the individual said to put the difference to code 4040 on the tax return "State any medical scheme contributions made by yourself and not reflected on your IRP5/IT3a".

My concern here is:

1) The individual did not make any contributions out of his own pocket, the employed paid the full contributions
2) The SARS guide says that when you complete field 4040 no amount should appear next to code 4474 and/or 4005 (in this case there is an amount next to these codes, but the amount is less than the amount for contributions on the medical aid certificate)

Any advice will be appreciated.

[Christel]

Hello J7J,
I would think the onus is on the employer to correct this. Like you mentioned, all contributions are paid by them, thus meaning this is a fringe benefit / and a deduction is coming off his salary monthly for his portion (if applicable)?
So the IRP5 would have a code 3810 with the company portion, a code 4474 and code 4005.
This must be 100% correct and should agree to the medical aid certificate.
What I would have done if I was the payroll person is to correct the IRP5 and if there was a difference in PAYE, to discuss it with the employee and work out how to settle it.
So the payroll people would have to revise the IRP5 now and re-submit the EMP501 and this certificate. You wait then about 48 hours and refresh the IRP5 on the IT12 and all should be fine.

[J7J]

Hi ChristelACS,

Thank you for your response - sorry for my delay in saying thanks!