SOURCE CODE DESCRIPTIONS IRP5 code 4005

Deduction codes

In the electronic file IRP5 code 4005 is used for: Medical scheme fees (contributions) paid and ‘deemed paid’ by employee (if applicable), excluding the value of code 4493.
· ‘Deemed paid’ by employee is the value of the taxable benefit (code 3810) included in the income of the employee.
· Employee contributions to private medical aid considered for PAYE purposes by the employer must be included in this code.

The prescribed Length of IRP5 code 4005 in the electronic file is: N15

The abbreviations used within the description of the relevant codes mean:
• PAYE: Income is subject to the deduction of Employees’ Tax and will also be taxed when the income tax assessment for the employee is processed.
• IT: Income is not subject to the deduction of Employees’ Tax but will also be taxed when the income tax assessment for the employee is processed.
• Excl: Income is not subject to the deduction of Employees’ Tax and will also not be taxed when the Income Tax assessment for the employee is processed.
• Excl/PAYE: Depending on the circumstances described in the legislation, the income is either subject to both PAYE and Income Tax, or it is excluded from both PAYE and Income Tax