Updated: Jun 27, 2020
RETIREMENT ANNUITIES | TAX AVOIDANCE
The end of the 2017 tax season is fast approaching and the opportune time to top-up your contribution to your Retirement Annuity plan.
THERE IS A CLEAR DISTINCTION BETWEEN TAX AVOIDANCE AND TAX EVASION.
Tax evasion is illegal and unacceptable. Tax avoidance is to avoid paying unnecessary taxes due to insufficient financial planning. Everyone has the right to reduce their tax liability within the ambit of the law.
Contributions to a Retirement Annuity is tax deductible and currently, 27.5% of taxable income is allowed as a deduction, with an annual limit of R350 000.00 per annum. Money accumulated in a retirement annuity is protected against claims of creditors. There is also no tax payable on the investment returns earned within a retirement annuity. In addition, no estate duty is levied on retirement annuities in the event of a death.
Contact your financial advisor for further assistance.