TAX1501
LEARNING UNIT 2: SELF-ASSESSMENT
LESSON 2: QUESTIONS AND ANSWERS
1. Kwena Dlamini is 45 years old, she has been deaf her whole life and diagnosed as such by a
registered medical practitioner in accordance with the criteria prescribed by the Commissioner.
During the current year of assessment, she contributed R19 500 to a medical aid. She also paid R8
600 additional qualifying expenses not covered by the medical aid. She is the only registered
member in her medical aid.
YOU ARE REQUIRED to calculate Kwena’s medical scheme fees tax credit for the current year of
assessment.
RESPONSE: Medical scheme tax credit (R332 x 12months) = R3 984
2. Kwena Dlamini is 45 years old, she has been deaf her whole life and diagnosed as such by a
registered medical practitioner in accordance with the criteria prescribed by the Commissioner.
During the current year of assessment, she contributed R19 500 to a medical aid. She also paid R8
600 additional qualifying expenses not covered by the medical aid. She is the only registered
member in her medical aid. Her taxable income for the current year of assessment is R250 000.
YOU ARE REQUIRED to calculate Kwena’s additional medical expenses tax for the current year of
assessment.
RESPONSE:
A = R19 500 (medical aid contributions)
B = R3 984 (MTC = (R332 x 12months) = R3 984)
C = R8 600
R R
Contributions 19 500
Less: 3 x MTC (3 x R3 984)) -11 952
Excess medical contributions 7 548
Add: Qualifying expenses 8 600
16 148
AMTC (33.3% X R16,148) 5 377
, TAX1501
3. John is 67-year-old and provided you with the following information regarding his income and
medical expenses for the 2022 year of assessment.
• John earned a salary of R655 000 (excluding any taxable benefit).
• John contributed R34 000 towards ABC Medical Aid Scheme.
• John’s employer paid R12 000 towards ABC Medical Aid Scheme.
• He had allowable out-of-pocket medical expenses of R35 860. He has kept proof of all expenses.
• John’s employer deducted employee’s tax of R164 173
John is the main member on ABC Medical Aid Fund and has three dependants – a spouse and two
children.
YOU ARE REQUIRED to calculate the normal tax liability/refund due of John for the current year of
assessment.
RESPONSE:
R R
Salary 655 000
Employer medical aid contribution (fringe benefit) 12 000
Taxable income 667 000
Normal tax on R667 000
[R163 335 + ((R667 000 - R613 600) x 39%) 184 161
Primary rebate (15 714)
Secondary rebate (age rebate) (8 613)
Medical scheme tax credit ((R664 x 2) + (R224 x 2) x 12) (13 344)
Additional medical expense tax credit:
A = R34 000 + R12 000 = R46 000 (medical aid
contributions)
B = R13 344 (MTC – calculated above)
C = R35 860 (qualifying medical expenses)
LEARNING UNIT 2: SELF-ASSESSMENT
LESSON 2: QUESTIONS AND ANSWERS
1. Kwena Dlamini is 45 years old, she has been deaf her whole life and diagnosed as such by a
registered medical practitioner in accordance with the criteria prescribed by the Commissioner.
During the current year of assessment, she contributed R19 500 to a medical aid. She also paid R8
600 additional qualifying expenses not covered by the medical aid. She is the only registered
member in her medical aid.
YOU ARE REQUIRED to calculate Kwena’s medical scheme fees tax credit for the current year of
assessment.
RESPONSE: Medical scheme tax credit (R332 x 12months) = R3 984
2. Kwena Dlamini is 45 years old, she has been deaf her whole life and diagnosed as such by a
registered medical practitioner in accordance with the criteria prescribed by the Commissioner.
During the current year of assessment, she contributed R19 500 to a medical aid. She also paid R8
600 additional qualifying expenses not covered by the medical aid. She is the only registered
member in her medical aid. Her taxable income for the current year of assessment is R250 000.
YOU ARE REQUIRED to calculate Kwena’s additional medical expenses tax for the current year of
assessment.
RESPONSE:
A = R19 500 (medical aid contributions)
B = R3 984 (MTC = (R332 x 12months) = R3 984)
C = R8 600
R R
Contributions 19 500
Less: 3 x MTC (3 x R3 984)) -11 952
Excess medical contributions 7 548
Add: Qualifying expenses 8 600
16 148
AMTC (33.3% X R16,148) 5 377
, TAX1501
3. John is 67-year-old and provided you with the following information regarding his income and
medical expenses for the 2022 year of assessment.
• John earned a salary of R655 000 (excluding any taxable benefit).
• John contributed R34 000 towards ABC Medical Aid Scheme.
• John’s employer paid R12 000 towards ABC Medical Aid Scheme.
• He had allowable out-of-pocket medical expenses of R35 860. He has kept proof of all expenses.
• John’s employer deducted employee’s tax of R164 173
John is the main member on ABC Medical Aid Fund and has three dependants – a spouse and two
children.
YOU ARE REQUIRED to calculate the normal tax liability/refund due of John for the current year of
assessment.
RESPONSE:
R R
Salary 655 000
Employer medical aid contribution (fringe benefit) 12 000
Taxable income 667 000
Normal tax on R667 000
[R163 335 + ((R667 000 - R613 600) x 39%) 184 161
Primary rebate (15 714)
Secondary rebate (age rebate) (8 613)
Medical scheme tax credit ((R664 x 2) + (R224 x 2) x 12) (13 344)
Additional medical expense tax credit:
A = R34 000 + R12 000 = R46 000 (medical aid
contributions)
B = R13 344 (MTC – calculated above)
C = R35 860 (qualifying medical expenses)
