As of this year, new changes will be made to the way contributions to Medical Aid Schemes are collected from expatriate employees and their employers in South Africa. Up until now, the Income Tax Act in South Africa saw a deduction taken directly from earnings. This amount was capped and taken from either the employee or employer.
The deduction will now be replaced by a smaller tax credit amount, reducing tax payable by the employee. Factors such as how many dependants and how much they earn help denote the amount the taxpayer must contribute. This said though, the application of Medical Aid for expats is still believed to not be fully resolved.
For expatriates it is important to plan your affairs well before making the move to South Africa. A large number of expatriates are moving abroad without the appropriate life or income insurance. Recent research showed that around 61 per cent of expats had no life or income protection with an additional 7 per cent that just weren’t sure.
Although moving abroad can be an exciting prospect, it is vital that whether a long or short term move that precautions are made. Many expats favour a travel style policy which you can top up and leave when you want. This is often not practical, especially for expats planning on staying in a country for a long period of time. These sorts of policies seldom cover some of even the most basic of requirements for a working expat. In the event of a death or chronic illness, additional costs can mount up, way beyond the initial price of the appropriate life and/or income policy.
If you are thinking of moving abroad to South Africa, Australia or even New Zealand, choosing the best mover for the job makes the transition a breeze. 1st Move International has been successfully moving people’s worldly goods for over 15 years now.