SARS introduces important medical aid tax changes for 2024

The South African Revenue Service (SARS) is updating the reporting requirements for medical aid data.

SARS has recognised the challenges faced by taxpayers in submitting medical aid data accurately and on time.

To help simplify this process and reduce the burden on taxpayers, SARS is making changes regarding the data that is required from medical aid schemes.

Medical aid data changes include:

• Provision of data on disabled principal members and their dependents.
• Data of persons making payment on behalf of principal members.
• Separate non-allowable from the allowable expenses, currently reported as claims not paid or covered by medical schemes on the IT3(f) certificate.

For ease of reference, the changes in the latest External Medical Scheme Contributions Business Requirement Specification (BRS) (v1.09-2) are as follows:

• Field 4, File Layout Version must be 3
• Updated the fields (182 and 206)
• Updated the Medical Practitioner HPSCA number fields (196 and 220) for Principal Member and Dependant
• Updated the end date of disability fields (195 and 219) for Principal Member and Dependant
• Updated the non-allowable source code (Appendix A)
• Updated the Logic validation for Third-Party Payor unique number field (235) under the Person Paying Account Financial Data

These changes will also allow SARS to reduce audit interventions, enable speedy assessment of tax returns and assist in allocating medical tax credits to the correct taxpayers.

File submission structures 

Effective 5 October 2024, medical scheme contributions must be provided in line with the requirements outlined in the new BRS (v10.9-2).

Channels for submission

The new Medical Scheme Contributions solution will be available via Connect: Direct® and Secured File Gateway [HTTPS].

Trade testing

The medical aid data trade testing is scheduled from 16 September 2024 to 4 October 2024.

Should you have any trade testing queries, please refer them to SARSTradeTesting@sars.gov.za with the subject line “Medical Trade Testing”.

Please ensure that all your submissions are completed within the specified period to facilitate a smooth submission process.

Note that:

• The Test Platform will remain open throughout the submission period to ensure that all the data files that you have submitted conform to the specified BRS prior to being submitted to Production. Testing support is available to address any issues identified during testing.
• The Production Platform is also open. SARS encourages you to submit your third-party data for the 2024 tax year as soon as possible, but no later than 31 October 2024.

Transition period

To ensure a smooth transition, SARS will grant a grace period of six (6) months for partial submission of the requested data, while stakeholders obtain resources to achieve full compliance. For cases of partial compliance, reasons and a commitment date for full compliance must be submitted to Bus_Sys_CDSupport@sars.gov.za.

As a reminder, SARS has confirmed the dates for the 2024 tax season.

• Individual taxpayers (non-provisional): 15 July 2024 to 21 October 2024
• Provisional taxpayers: 15 July 2024 to 20 January 2025
• Trusts: 16 September 2024 to 20 January 2025