Retirement Annuity  / Pension / Provident Benefits

 
TAX RATES FOR BENEFITS ON PENSION AND PROVIDENT FUNDS ON RETIREMENT AND DEATH


PROVIDENT FUND PENSION FUND RETIREMENT ANNUITY DEFERRED COMPENSATION
Cash Lump Sum Cash Lump Sum Cash Lump Sum Cash Lump Sum
 
RETIREMENT BENEFIT
 

Entire amount or cession value of policy

1/3  of total value (if annuity less than R75 000.00 full amount canbe withdrawn). [Section 1 "pension Fund" (c) (ii) (dd).]

Balance comp annuity taxed i.t.o. tax tables

1/3 of total value (if annuity less than R75 000.00 full amount can be withdrawn).
[Section 1 "RA fund
" (b) (ii).] Balance comp. Annuity Taxed i.t.o. tax tables
Entire cash amount or special cession value.
Tax-free portion Tax-free portion Tax-free portion Tax-free portion

Z = C + E – D



R 0 to R500 000 -  0% Tax
R500 001 to R700 000 - 18% Tax
R700 001 to R1050 000 - 27% Tax
R1050 001 plus - 36% Tax

 

E = PREVIOUSLY DISALLOWED OWN CONTRIBUTIONS
D = TOTAL TAX FREE FROM OTHER APPROVED FUNDS
Z = TAX FREE AMOUNT
C = AMOUNT TAXED AT
[2nd Schedule]

Z = C + E – D

 
 

R 0 to R500 000 - 0% Tax
R500 001 to R700 000 - 18% Tax
R700 001 to R1050 000 - 27% Tax
R1050 001 plus - 36% Tax


 
E = PREVIOUSLY DISALLOWED OWN CONTRIBUTIONS
D = TOTAL TAX FREE FROM OTHER APPROVED FUNDS
Z = TAX FREE AMOUNT
C = AMOUNT TAXED AT
[2nd Schedule]

Z = C + E – D


R 0 to R500 000 - 0% Tax
R500 001 to R700 000 - 18% Tax
R700 001 to R1050 000 - 27% Tax
R1050 001 plus - 36% Tax



 
 
 
 
 
 
 
 
 
E = PREVIOUSLY DISALLOWED OWN CONTRIBUTIONS
D = TOTAL TAX FREE FROM OTHER APPROVED FUNDS
Z = TAX FREE AMOUNT
C = AMOUNT TAXED AT
[2nd Schedule]
R30 000 less tax free lump sums previously received. Provided that :
  • recipient at least 55 ; or
  • termination due to superannuation, ill health or other infirmity; or
  • termination due to employer ceasing business or redundancy as a result of employer’s general reduction in personnel and, in the case of a company, the employee was not a director and shareholder with more than 5 % of share capital

[Section 10 (1) (x)]





 
 
 
 





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