Who Gets to Tax Your Retirement Benefits?
Navigating double taxation agreements in retirement planning. Cross-border retirement planning raises difficult tax questions. This article unpacks how double taxation agreements (DTAs) shape the taxation of lump sums and annuities, and the steps advisors can take to help preserve clients’ retirement benefits. For South Africans who have built their careers locally but now live abroad, […]
Understanding the Two-Pot Retirement System: Questions and Answers
As of 1 September 2024, significant changes have been introduced to the retirement landscape in South Africa with the implementation of the two-pot retirement system. This system allows members of pension funds, provident funds, and related schemes to access a portion of their savings while still working. With this shift, it is essential to understand […]
Three Innovative Approaches to Boost Your Retirement Savings
Retirement planning is absolutely key to your financial well-being, but let’s face it, as those golden years inch closer, a lot of us start to worry if what we’ve saved up is really going to cut it. Sure, sticking to the tried-and-true savings plans is essential, but why not think outside the box a little? […]
From Departure to Encashment
How the two-pot retirement system impacts expats The much-anticipated two-pot retirement system, introduced as a ‘knight in shining armour’ for South Africans, has received a new implementation date of March 2024. Expats are cautioned to pay attention to the effects that this will have on the encashment of their retirement savings. While many have addressed […]
Tax breaks for retirement funding
While there are very few tax breaks for individuals, some huge ones are available for retirement funding. Retirement tax breaks in South Africa are designed to incentivise individuals to save for retirement and provide them with tax relief on contributions to retirement funds. The government has implemented various tax incentives over the years to encourage […]
Retirement planning – Distributing retirement fund death benefits
Allocating death benefits, and determining appropriate methods of payment Once the board of trustees has determined the beneficiaries and is satisfied that its proposed allocation is fair and equitable, the beneficiaries must elect how they would like to receive the death benefit. The final duty of the trustees is to determine the most appropriate manner […]
Two retirement pots: Limited access, compulsory preservation
Is the proposed two-pot retirement system ‘stirring the pot’ in the retirement fund industry? The Draft tax legislation released by National Treasury on 29 July 2022 contains details of the much anticipated two-pot retirement system. The proposed changes are quite far-reaching—although there will also be criticism that the changes do not go far enough. The […]
Your retirement ‘gift’ to SARS
Tax payable on your retirement lump sum In last month’s issue of Tax Breaks, we dealt with the tax treatment of retirement lump sums when one resigns or is dismissed (prior to reaching normal retirement age). However, when you actually retire from a retirement fund, the rules are a bit different – and SARS gives […]