Tax on retirement annuity contributions: Changes forthcoming!

At present up to 15 per cent of non-retirement funding income can be invested in Retirement Annuities (RA) and deducted from taxable income.

This limit is set to increase as from 1 March 2014. Although final legislation in this regard is still awaited, it has been proposed that persons will be able to claim a deduction of up to 27, 5 per cent of taxable income, with an annual limit of R350 000. This will apply to contributions made to all funds, e.g. an RA fund as well as an occupational pension fund.

In his recent budget speech the Minister of Finance also proposed other changes to retirement savings. Details will be communicated to our clients as soon as there is certainty about all the proposed changes.

These developments on the tax front are brought to the attention of clients in good time so that they may be taken into account in their retirement planning.

For more detailed information in this regard or for advice on your retirement planning, don’t hesitate to get in touch with one of the directors.

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