What is Code 4474 on a South African IRP5?
Your SARS medical aid tax credit explained — the 2026/2027 rates, how it reduces your PAYE directly, and the critical difference between a credit and a deduction.
4474Code 4474 is the total Section 6A medical aid tax credit applied to your PAYE for the year — R376/month for the main member, R376/month for the first adult dependant, and R254/month for each additional dependant (2026/2027). It reduces your actual PAYE deduction directly, giving you a fixed rand-for-rand benefit regardless of your income level.
Medical Aid Tax Credit (Code 4474) — 2026/2027 Monthly and Annual Rates
| Members covered | Monthly credit (code 4474) | Annual credit | Approx. PAYE saving |
|---|---|---|---|
| Principal member only | R376 | R4,512 | R4,512 off annual PAYE |
| Principal + 1 dependant | R752 | R9,024 | R9,024 off annual PAYE |
| Principal + 2 dependants | R1,006 | R12,072 | R12,072 off annual PAYE |
| Principal + 3 dependants | R1,260 | R15,120 | R15,120 off annual PAYE |
| Each additional dependant | +R254/month | +R3,048/year | +R3,048 per additional dependant |
The MTC is a direct rand-for-rand reduction in PAYE owed — it is not a deduction from taxable income. The same credit applies regardless of your marginal tax rate or income level.
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What Code 4474 Means
Code 4474 records the annual total of the Section 6A medical aid tax credits applied to your PAYE throughout the year. It appears in the deductions section of your IRP5 as a credit against the PAYE (code 4102) that would otherwise have been withheld.
The Section 6A credit was introduced as part of South Africa's medical aid tax reform to replace the old medical aid contribution deduction. Unlike a deduction (which reduces taxable income and is therefore worth more to higher earners), a tax credit gives every medical aid member a fixed rand benefit regardless of income bracket. A R376 monthly credit saves a R15,000/month earner exactly the same R376 as it saves a R150,000/month earner.
Your employer applies the appropriate credit monthly when processing your payslip — reducing the PAYE that would otherwise be deducted from your salary. The annual cumulative total of all these monthly credits is what appears as code 4474 on your IRP5.
2026/2027 Medical Aid Tax Credit Rates
The Section 6A rates are set annually in the Budget and apply for the full tax year from 1 March to 28 February.
| Member | Monthly Credit (Section 6A) | Annual Credit |
|---|---|---|
| Main member | R376 | R4,512 |
| First adult dependant | R376 | R4,512 |
| Each additional dependant | R254 | R3,048 |
How Code 4474 Reduces Your Monthly PAYE
Your employer first calculates the gross PAYE on your total taxable income (salary + fringe benefits), then subtracts the applicable monthly Section 6A credit before deducting PAYE from your salary. This means your code 4474 credit reduces your take-home impact directly — it is not a year-end benefit but a monthly improvement to your net pay.
| Item | Main member only | Main + 1 adult dependant | Main + 1 adult + 2 children |
|---|---|---|---|
| Monthly gross salary | R30,000 | R30,000 | R30,000 |
| PAYE before credits | R4,730 | R4,730 | R4,730 |
| Section 6A credit (code 4474) | −R376 | −R752 | −R1,260 |
| PAYE deducted after credit | R4,354 | R3,978 | R3,470 |
| Monthly take-home improvement | R376 | R752 | R1,260 |
Adding two children as dependants saves R1,260 per month in PAYE compared to having no medical aid — a meaningful and consistent benefit at every income level. Use our Medical Aid Tax Credit Calculator to calculate your exact Section 6A and Section 6B credits.
Section 6A vs Section 6B — The Difference
Code 4474 captures Section 6A credits only — the fixed monthly per-member amounts applied throughout the year. Section 6B is a separate, additional credit calculated at year-end on your tax return. For an under-65 taxpayer without a qualifying disability, it applies only when your total medical aid contributions (employer code 3810 + employee code 4005) exceed four times your annual Section 6A credit by more than 7.5% of your taxable income — a floor that absorbs the excess for most working-age earners, meaning no Section 6B credit actually results. A more generous formula with no 7.5% floor applies if the taxpayer, their spouse, or a dependant has a disability, or the taxpayer is 65 or older.
Section 6B does not appear on your IRP5 under code 4474 — it is calculated separately on your ITR12 return based on the codes 3810, 4005, and 4474 that appear on your IRP5.
Frequently Asked Questions
What does code 4474 mean on my IRP5?
Code 4474 is the total Section 6A medical aid tax credit applied to your PAYE during the year. SARS allows R376/month for the main member, R376 for the first adult dependant, and R254 for each additional dependant (2026/2027). Your employer applies these monthly, reducing your PAYE deduction, and the annual total appears as code 4474 on your IRP5.
Does code 4474 reduce my taxable income or my PAYE?
It reduces your PAYE directly — not your taxable income. This means every medical aid member gets the same fixed rand benefit regardless of their tax bracket. A R376/month credit is worth exactly R376 to a low-income earner and exactly R376 to a high-income earner — unlike a deduction, which would be worth more to higher-bracket taxpayers.
What are the medical aid tax credit rates for 2026/2027?
For the 2026/2027 tax year (1 March 2026 to 28 February 2027): R376/month for the main member, R376/month for the first adult dependant, and R254/month for each additional dependant. These are the Section 6A fixed credits applied monthly to your PAYE by your employer.
What is the difference between Section 6A (code 4474) and Section 6B?
Section 6A (code 4474) is the fixed monthly credit per member applied throughout the year by your employer. Section 6B is an additional credit calculated at year-end on your ITR12 return — for under-65 taxpayers without a qualifying disability, it applies only when total medical aid contributions exceed four times the annual 6A credit by more than 7.5% of taxable income, giving you 25% of that remaining excess. This 7.5% floor means most working-age taxpayers see no Section 6B credit at all; a more generous formula with no income floor applies at 65+ or with a disability. Section 6B does not appear in code 4474; it emerges from the year-end tax assessment.
Why does my code 4474 look lower than expected?
Common reasons: you joined or left a medical aid mid-year (so credits only apply for the months you were on the scheme), the number of dependants changed during the year, or your employer applied the wrong credit rate. Check your monthly payslips against the expected credit per month. Any shortfall can be corrected when you file your ITR12 — SARS will apply the full credit you are entitled to based on your medical aid membership.
If my employer missed medical aid credits during the year, can I still claim them?
Yes. If your employer did not correctly apply the Section 6A credits each month, the code 4474 on your IRP5 will be lower than your entitlement. When you file your ITR12 return, SARS calculates the correct credit based on your medical aid membership and applies the full amount — resulting in a refund or reduction of any balance owed. Never leave credits unclaimed due to employer payroll errors.
What is the medical aid tax credit in South Africa for 2026/2027?
The medical aid tax credit (MTC) for 2026/2027 is R376 per month for the principal member, R376 per month for the first dependant, and R254 per month for each additional dependant. This credit directly reduces the PAYE you owe — it is not a deduction from taxable income but a rand-for-rand reduction in tax. A taxpayer covering themselves and two dependants receives R1,006/month in MTC, reducing annual PAYE by R12,072. The credit appears as code 4474 on your IRP5 and is the same regardless of your income level or marginal tax rate.