By Chris Herbst, Chartered Business Accountant in Practice (CBAP) with CIBA, General Tax Practitioner (GTP) with SAIT, Stellenbosch University. Team registered with SAIT, SAIPA and CIBA.
Code 4005 is one of the most common lines in the deductions block of an IRP5, and one of the most misread. Many employees assume SARS picks it up and applies it automatically. It does not. The figure next to 4005 is the starting point for your medical scheme fees tax credit, and the credit depends on what you enter on your ITR12. This guide explains what the code contains, how it links to the other medical codes, how the credit is worked out from it, and what to check before you file.
What Does SARS Code 4005 Mean on an IRP5?
Code 4005 is the total of medical scheme contributions paid and deemed paid by you as the employee during the year of assessment. The SARS PAYE Business Requirements Specification describes it as medical scheme fees (contributions) paid and "deemed paid" by the employee, excluding the value of code 4493.
What does "deemed paid" mean?
"Deemed paid" is the value of the taxable benefit under code 3810, which is the part of the contribution your employer paid on your behalf. SARS explains in its FAQ on deemed medical contributions that an employer contribution is a taxable fringe benefit, and that the same amount is then regarded as a contribution made by you and added to your total contributions. That is why the 4005 figure is often larger than what was deducted from your payslip.
Does 4005 include what I paid privately?
Only where your employer took it into account for PAYE. The BRS states that employee contributions to a private medical aid that the employer considered for PAYE purposes must be included in code 4005. Contributions you paid from your own bank account, without your employer's involvement, are not on your IRP5 at all and are declared separately on the return.
Is 4005 a deduction from my income?
No. Medical scheme contributions are not deducted from taxable income. They give you a rebate, the medical scheme fees tax credit under section 6A of the Income Tax Act, which is subtracted from the tax calculated on your income.
How Does Code 4005 Relate to Codes 3810, 4474 and 4116?
Code 4005 rarely appears alone. It sits next to the codes that show who paid the contribution and what credit your employer already applied in the monthly PAYE calculation. Our guide to SARS code 3810 covers the fringe benefit side in detail; the short version is below.
What is code 3810?
Code 3810 is the taxable benefit for medical aid contributions your employer paid on your behalf. It is added to your income, and the same value is then counted inside 4005 as a contribution deemed paid by you.
What is code 4474?
Code 4474 records the employer's contributions paid to the medical scheme for your benefit. Where 3810 is completed, 4474 must carry the same value under the BRS validation rules.
What is code 4116?
Code 4116 is the medical scheme fees tax credit your employer allowed when it calculated your monthly PAYE. The BRS states that 4116 must not be completed if there is no value for code 4005, so the two travel together.
What about code 4493?
Code 4493 is a medical subsidy paid by a former employer, usually to a pensioner. On the IRP5 it is excluded from 4005. On the return it is treated differently, which is explained in the section on pensioners below.
- 4005: What it shows: Contributions paid and deemed paid; Where it counts: Medical tax credits
- 3810: What it shows: Employer-paid contributions; Where it counts: Taxable income
- 4474: What it shows: Employer contributions to the scheme; Where it counts: Must equal 3810
- 4116: What it shows: Credit used in monthly PAYE; Where it counts: PAYE calculation
- 4493: What it shows: Former employer subsidy; Where it counts: Declared separately
How Does Code 4005 Become a Medical Tax Credit?
The medical scheme fees tax credit is a fixed amount per month for each person covered, not a percentage of what you paid. SARS publishes the amounts on its medical tax credit rates page. For the 2027 year of assessment (1 March 2026 to 28 February 2027) the credit is R376 per month for the taxpayer, R752 for the taxpayer and one dependant, and R254 for each additional dependant. For the 2026 year of assessment, the return filed in the 2026 filing season, the amounts were R364, R728 and R246.
How do I work out my annual credit?
Count the months in which contributions were paid for each person and multiply by the monthly amount. A main member with a spouse and one child covered for the full 2027 year of assessment has a monthly credit of R752 plus R254, which is R1,006, or R12,072 for twelve months, calculated from the SARS rates.
Can the credit create a refund on its own?
No. The SARS Guide on the Determination of Medical Tax Credits states that the credit is a rebate, so it cannot exceed the normal tax payable, it is not refundable, and any excess cannot be carried forward to a later year.
Who counts as a dependant for the credit?
From years of assessment starting on or after 1 March 2018, a dependant has the section 6B(1) meaning: your spouse, your child or your spouse's child, a family member you are liable to care for and support, and any other person the scheme rules recognise as your dependant.
Does 4005 feed the additional medical expenses tax credit too?
Yes. The total contributions behind 4005 are also used in the additional medical expenses tax credit under section 6B. For taxpayers under 65 with no disability in the household, the guide states that this credit is 25% of the amount by which contributions above four times the medical scheme fees tax credit, plus qualifying out-of-pocket expenses, exceed 7.5% of taxable income. Taxpayers aged 65 and older, and households with a person with a disability, use a 33.3% formula without the 7.5% floor.
Where Do I Enter Code 4005 on My ITR12?
The SARS Comprehensive Guide to the ITR12 states that medical contributions reflected next to source code 4005 on your IRP5 are not automatically taken into account during the assessment. You must complete the medical section of the return for the credit to apply.
Which field carries 4005 on the return?
The field reads "State the total medical contributions made by yourself and / or your employer to this scheme (incl. subsidies from former employer)", and it is source code 4005 on the return. The guide tells you to insert the total contributions shown on your medical scheme's tax certificate.
What if my medical tax certificate shows no amount?
Some scheme certificates refer you to the employee tax certificate instead of stating a figure. The ITR12 guide states that in that case you complete the field with the amount next to source code 4005 on your IRP5, which already includes your employer's contributions.
Do I enter the same contributions twice?
No. Code 4040 on the return is only for contributions you paid in your private capacity that do not appear on any IRP5. The guide states that where your employer paid the contributions over to the scheme, you must not repeat them next to 4040; enter a zero there instead.
How Do I Check Code 4005 on eFiling, Step by Step?
These steps follow the screens of the ITR12 on eFiling and the fields the SARS guide describes.
- Open the return. Log in to eFiling and open the ITR12 for the year you are filing.
- Read the IRP5. In the Income section, view each IRP5/IT3(a) certificate and note the values next to 4005, 3810, 4474 and 4116. Confirm 3810 equals 4474 and that 4005 is at least as large as 3810.
- Mark the medical question. On the return wizard, mark with an X that you or your employer paid qualifying medical expenses, including contributions to a medical scheme where you are the main member. This opens the medical section.
- Complete the scheme details. Enter the scheme name, membership number and the number of dependants per month, then the total contributions in the 4005 field, using your medical scheme tax certificate.
- Compare the prepopulated figures. The ITR12 guide states that from the 2020 year of assessment SARS prepopulates medical details for the main member from data received from the scheme. Compare each prepopulated amount with your certificate and correct what does not agree.
- Add out-of-pocket expenses. Enter qualifying expenses not recovered from the scheme in their own fields, with proof kept on file.
- Review the calculation. Use the calculation before you submit and confirm the medical scheme fees tax credit is applied. After assessment, check it again on your ITA34.
What If Code 4005 on My IRP5 Is Wrong?
Your employer issued the IRP5, so your employer corrects it. The ITR12 guide states that where third-party data is incorrect, you must contact the data provider to correct it rather than editing the certificate on the return.
4005 is lower than 3810
That points to an error on the certificate, because 4005 must include the deemed contribution from 3810. Ask your payroll department to reissue the IRP5 before you file, or before you lodge a request for correction if you have already filed.
4005 is missing but I belong to the scheme through work
If your employer deducts contributions from your salary or pays them for you, 4005 must have a value. Ask your employer for a corrected certificate before you file.
The assessment did not give me the credit
Check whether the medical section of the return was completed. Since the 4005 figure is not applied automatically, an empty medical section produces an assessment without the credit. You can correct the return, or dispute the assessment through a notice of objection where the period for a correction has passed.
How Does Code 4005 Work for Pensioners and Shared Contributions?
How is a former employer's subsidy treated?
On the IRP5 the subsidy sits under 4493 and is excluded from 4005. On the return, the ITR12 guide states that from the 2019 year of assessment you include the subsidy when calculating the medical contributions amount for 4005, and you also declare it in the separate field provided for it.
What if my spouse or family shares the contributions?
Section 6A(3A) requires the credit to be apportioned between the people who paid. The SARS guide's example is two siblings who each pay half of a parent's contributions: each claims half of the credit. Only contributions you can prove you paid are taken into account.
What if someone else pays my medical aid?
The guide states that contributions paid by another person do not give you the credit, unless your employer paid them and the amount was included in your income as a taxable benefit, or your estate paid them after your death. A friend or relative who pays for you, where you are not their dependant, gives neither of you the credit.
Common Mistakes With SARS Code 4005
- Assuming SARS applies it automatically. The 4005 figure must be entered in the medical section of the ITR12 for the credit to apply.
- Entering only the payslip deduction. The 4005 total includes your employer's share under 3810, and the certificate figure includes both.
- Repeating employer-paid contributions under 4040. 4040 is for private payments that are not on an IRP5, and the guide says to enter a zero there when your employer paid the scheme.
- Wrong dependant count. The credit is calculated per person per month, so a missing or extra dependant moves the figure.
- Ignoring 4493 on a pension. From 2019 the subsidy is part of the 4005 amount on the return and is also declared separately.
- Throwing away the certificate. The ITR12 guide states that supporting documents must be kept for five years from the date the return is submitted, and SARS can request them in a verification.
For the full picture of medical claims, including out-of-pocket expenses and disability, see our guide to medical tax deductions. If your employer also paid medical costs directly, our guide to SARS code 3813 explains that benefit, and our guide to the ITA34 and its codes shows where these figures land on your assessment.
Do You Need Help With SARS Code 4005?
If your medical credits look wrong, your IRP5 does not match your scheme certificate, or your assessment left the credit out, we can check the figures and file or correct the return for you. See our personal tax plans, browse more personal tax guides, or contact us to book a call.
