Have you considered making an additional contribution to your Retirement Annuity before the end of the tax year?
With the 2020/2021 tax year drawing to a close on 28 February 2021, now is the time to take advantage of the tax deductions and savings that Retirement Annuities (RA) offer.
If you have additional funds available, reap the benefits of a Retirement Annuity (RA) by making an additional contribution. RA’s have a number of tax advantages:
- Contributions are tax deductible within certain limits.
- Investment returns are tax free – there is no income tax or capital gains tax on the investment growth
- Protection from creditors – only a limited number of people or institutions can claim from an RA. They include SARS for unpaid taxes and previous spouses (and then only in terms of a court approved divorce settlement).
- Under current legislation (pre-2021 budget speech), individuals can make annual tax-free contributions to the greater of 27.5% of your taxable income or remuneration, subject to a ceiling of R350,000.
- Any contributions exceeding the R350,000 cap are carried over to the following year and are allowed as a deduction subject to the same limits above.
- Any existing debit orders on your Retirement Annuities for the tax year should be taken into account for the annual limit.
If you would like more information, please contact your Trust Officer or call our switchboard on 021 689 8975 by no later than Monday the 15th of February 2021.