Retirement Annuity FAQ

What is a retirement annuity?

A retirement annuity (RA) is a retirement fund in terms of the Pension Funds Act. It is a tax effective investment vehicle designed for individual investors (as opposed to employees who contribute to a workplace retirement fund). A retirement annuity is ideal for people who- are self-employed;- don’t have access to a work-place pension or provident fund through their employer;- want to supplement their pension or provident fund savings- earn significant amounts of non-pensionable income (eg interest and rental in...

Are retirement annuities effective as estate planning tools?

I have read that Retirement Annuities are also very effective estate planning tools. The proceeds are exempt from estate duty, capital gains tax and executor fees because the cash amount can be paid directly to the beneficiaries if they exercise this option. What must I do to confirm this specific option is exercised?

What is the tax treatment of arrear and excess contributions?

I am considering a new retirement annuity with 10X, but I am confused by the terminology regarding the tax treatment and definition of “arrear” vs “excess” retirement annuity contributions. Am I correct in assuming that I can claim up to R1 800 p.a. as “arrear contributions” for those past years when I did not contribute the maximum tax free amount to my retirement annuity and that I can carry over R1 800 p.a. until such time as I have used up all of my arrear retirement annuity tax free allowances not used in the pas...

What are the similarities between the Sanlam and Old Mutual RA's?

list a few similarities between sanlam and old mutuals retirement annuity policy

Can I claim RA contributions made this tax year in my prior year tax return?

I do not have any existing retirement annuity funds and i would like to start one. However, i would like to know if i make a lumpsum payment (up to my allowable 15% max) now can i get the tax refund for it as i want it to relate to last years tax year. Basically i would effectively be making two lumpsum payments this year, one i would want to be tax deductible for the 2014 tax year (the return to be submitted later this year) and the other one for the 2015 tax year (relating to the tax return to be submitted in 2015)....

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