Tax Update 2009

Previous Blogs

2008 / 2009 Tax Update

1.                  Living Annuities

1.1              Buyer

1.1.1        Previous fund member or his/her

1.1.2        Dependants; or his/her

1.1.3        Nominees; using

1.1.4        Funds from one or more other funds

1.2              Provider

1.2.1        Provider

1.2.2        On of after retirement date; when

1.2.3        Said date is deformed by fund rules and not by age.

1.3              Other Requirement

1.3.1        Value of benefits not guaranteed

1.3.2        Benefits are a sum of assets and income.

1.3.3        Lump sum termination once assets drop below certain levels.

1.3.4        Upon death, lump sum to estate or nominee, second life.

2.                  Lump Sum Tax Rates

2.1              Tax Free Amount

 R300 000 once a life time

2.2              Taxable Value

2.2.1        < R300 000                  R0                + 18%

2.2.2        R301 000 – R600 000  R54 000       + 27% excess over R300 000

2.2.3        R601 000 +                  R135 000      +36% On Excess Over R600 000

3.                  Other Important Requirement

3.1              Death

3.2              Divorce

3.3              Emigration

3.4              Combine funds

3.5              Preservation  fund – multiple withdrawals based on multiple contributions

3.6              Preservation fund – closed fund iro monthly contributions only

4.                  Resignation From Funds – taxation of retirement savings

4.1              Other Deduction allowed to increase R22 500

4.1.1        Unclaimed distribution

4.1.2        Fund to fund transfer

5.                  Micro Business Turnover Tax

6.                  Taxation Of Dividends

5.                  Penalties

9.1              Note the per month rule – the cheap penalties are indeed expensive as they can run up for 47 months

9.2              Failing to update SARS on your address is R250 per month from the date you moved until the date they found / traced you. Add to this the non-filing or late payment penalties ….it is no longer worth the fun! See (b) below!


Published by Hugo van Zyl CA(SA) TEP MTP(SA)

I am a qualified Chartered Accountant (South Africa) and a registered Master Tax Practitioner (South Africa) and Trust and Estate Practitioner. I live in Cape Town yet many clients and intermediaries are based in Sandton, Durban, Bloemfontein ad Pretoria. I, therefore, commute on a regular basis. I have been married for some 20 years, we have no children and we love to travel. We share an affinity for good company, interesting food and good value for money wines.

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