The 2018/19 tax year closes on 28 February and you’re able to reap significant tax advantages by making an additional contribution (lump sum) into your retirement annuity (RA) before the tax year-end OR contribute to a Tax-free savings account to supplement your retirement savings.

Retirement Annuities
Contributions made before the tax year-end may be tax-deductible within certain legislative limits.  An additional investment into an RA is beneficial provided that you have not yet reached your maximum tax deductible RA contribution for the year.  If you do not expect your RA contributions for the current tax year to reach your maximum tax deductible amount by the end of the month, it may be worth considering an additional RA contribution to do so.

Tax-free Savings Accounts
TFSAs provide South African investors with a flexible way to save towards a specific goal or supplement their retirement savings. As TFSAs are not subject to income or capital gains tax, they can be a useful tool to grow savings. The current annual contribution limit is R33 000 (if by debit order, then a maximum of R2750 per month) and the lifetime contribution limit is R500 000. If investors contribute less than R33 000 per annum, they may not carry over unused contributions to the next financial tax year.

We would like to encourage you to contact us if you have any questions.