Retirement Annuities
As the end of
the current tax year approaches, it may be a good time to consider an
additional ad hoc contribution to your Retirement Annuity so that you
can make the most of the annual maximum tax deductible amount allowed by
SARS. Perhaps you have earned a bonus, or put aside money for a rainy
day that never came.
Currently all
individual tax payers who contribute towards a retirement fund will
qualify for a tax deduction up to 27.5% of the greater of gross
remuneration or taxable income. This rate applies to the aggregate of
contributions made to an individual’s pension, provident and retirement
annuity funds.
The annual tax deduction cap is R350 000.
Individuals who
contribute more in any one year can carry forward any unclaimed amount
and deduct these from tax in subsequent years, subject to the deduction
limits in those years.
If, to date, you have contributed less than the maximum tax-deductible
amount to your RA, you can use any additional cash to top up your RA and
enjoy the full tax benefit.
Tax Free Savings Accounts
Similarly, you
are able to maximise your investment returns by contributing the maximum
R33,000 per annum to a Tax Free Savings Account (lifetime limit
R500,000) as the interest, capital gains and dividends you earn on these
investments are completely tax free.
Should you wish to make a top-up to either your retirement annuity or
tax-free savings account for the 2019 tax year, please contact us by the
no later than the 15th of February.
GETTING BACK FROM THE TAXMAN – T2019
