SA Budget 2018/19 – Tax rates for retirement lump sum benefits

RETIREMENT LUMP SUM benefits Tax relief on retirement lump sum benefits is allocated once in a lifetime in other words if it’s used up you can’t claim it again. For example, if a person used R300 000 of the R500 000 with the first lump sum, the balance left is R200 000 and once this is used up this relief is not available again.  For more details on how it works, read our Budget Tax Guide. Withdrawal Benefit 2019 tax year (1 March 2018 – 28 February 2019) – No changes from last year – No changes from last year Taxable income (R)​ Rate of tax (R)​ 0 – 25 000​ ​0% ​25 001 – 660 000 ​18% of taxable income above 25 000 ​660 001 – 990 000 ​114 300 + 27% of taxable income above 660 000 ​990 001 and above ​​203 400 + 36% of taxable income Read More …

SA Budget 2018/19 – Tax rates for interest and dividends

interest and dividends Interest Exemptions – no changes from last year Interest from a South African source earned by a natural person is exempt, per annum, up to an amount of: ​ ​2019 2018​​ 2017​ 2016​ ​2015 ​Person younger than 65 ​​R23 800 ​R23 800 ​R23 800 ​R23 800 ​R23 800 ​Person 65 and older ​​R34 500 ​R34 500 ​R34 500 ​R34 500 ​R34 500 Please note: For the 2012 tax year – Foreign interest and foreign dividends are only exempt up to R3 700 out of the total exemption. From 1 March 2015 (2016 tax year), a final withholding tax at a rate of 15% will be charged on interest from a South African source payable to non-residents. Interest is exempt where earned by non-residents who are physically absent from South Africa for at least 181 days during the 12 month period before the interest accrues and the debt from which Read More …

SA Budget 2018 – Medical Tax Credit Rates

Medical Tax Credit Rates Medical Scheme Fees Tax Credit was introduced from 1 March 2012 but didn’t affect all categories of taxpayers at once. There are two different start dates depending on the age of the taxpayer: Taxpayers younger than 65 – converted to the Medical Tax Credit from 1 March 2012 Taxpayers 65 and older  – converted to the Medical Tax Credit from 1 March 2014 Medical Tax Credit Rates from 2013 tax year onwards – see changes from last year ​Per month (R) 2019​ ​2018 2017​​ ​2016 ​2015 ​For the taxpayer who paid the medical scheme contributions R​310​ ​R303 ​R286 270 ​257 ​For the first dependant ​R310 ​R303 ​R286 ​270 ​257 ​For each additional dependant(s) ​R209 ​R204 ​R192 ​181 ​172 Capped deduction prior to 2013 tax year ​Capped deduction per month ​2012 ​For the taxpayer who paid the medical scheme contributions​ ​720 ​​For the first dependant ​720 ​​For Read More …

SA Budget 2018 – Tax rates for Companies, trusts and Small Business Corporations (SBC)

Companies, trusts and Small Business Corporations (SBC) Companies – no changes from last year ​Financial years ending on any date between ​Rate of Tax ​​1 April 2018 – 31 March 2019 ​28% ​1 April 2017 – 31 March 2018 ​28% ​1 April 2016 – 31 March 2017 ​​28% ​1 April 2015 – 31 March 2016 ​28% ​1 April 2014 – 31 March 2015 ​28% Top Tip: Personal Service Providers are no longer taxed separately and are taxed as a company or as a Trust. The following rates of tax apply for financial years ending on any date between 1 April 2011 – 31 March 2012 for: ​Type ​Rate of tax Personal service provider companies​ ​33% ​Foreign resident companies which earn income from a source in South Africa ​33%   Trusts (other than special trusts) – no changes from last year Year of assessment ​Rate of Tax ​​1 March 2018 – 28 Read More …

South Africa Tax for individuals

rates of tax for individuals 2019 tax year (1 March 2018 – 28 February 2019) – see changes from last year ​Taxable income (R) ​Rates of tax (R) 0 – 195 850 18% of taxable income 195 851 – 305 850 35 253 + 26% of taxable income above 195 850 305 851 – 423 300 63 853 + 31% of taxable income above 305 850 423 301 – 555 600 100 263 + 36% of taxable income above 423 300 555 601 – 708 310 147 891 + 39% of taxable income above 555 600 708 311 – 1 500 000 207 448 + 41% of taxable income above 708 310 1 500 001 and above 532 041 + 45% of taxable income above 1 500 000 2018 tax year (1 March 2017 – 28 February 2018) ​Taxable income (R) ​Rates of tax (R) 0 – 189 880 18% Read More …

2018 South African budget speech summary | tax proposals

Overview South African Minister of Finance Malusi Gigaba delivered the 2018 Budget Speech and tax proposals today, 21 February 2018. Relatively few changes to existing tax rates were proposed. The remainder of the Budget includes proposals for further tax reform and amendments to take place during the course of the year. The most significant of these for corporate and high net worth clients are summarised below, as are the changes to existing tax rates. The full scope of proposed tax changes will be addressed once draft legislation is available.

SA Budget 2018 – Higher VAT will increase inequality – Wits research unit

Cape Town – The hike in value added tax (VAT) from 14% to 15% poses the risk of eroding the spending power of poor and lower-income households, exacerbating poverty and increasing inequality, according to the Corporate Strategy and Industrial Development (CSID) research unit at Wits University. VAT has contributed 24% to 27% of tax revenue in SA, and has been held constant at 14% since 1993. It explained that VAT is levied irrespective of how much somebody earns, making it a regressive tax and in its view, taxes on goods (VAT and excise duty) hit the poor the hardest.

SA Budget 2018 – Raising VAT rate the right approach – analyst

Author: Lameez Omarjee. Cape Town – Although the higher VAT rate will be a challenge for household budgets, an analyst says it is the correct way for government to go about raising tax revenue. On Wednesday Finance Minister Malusi Gigaba announced in his budget speech that the VAT rate would increase one percentage point to 15%, as of April 1 2018. This is expected to raise an additional R22.9bn to help plug the tax revenue shortfall of R48.2bn.

SA Budget 2018 ANALYSIS: A fair budget in a difficult environment

Author: Jaco Leuvennink (Fin24). Cape Town – Although a cloud of political uncertainty hangs over his head, Finance Minister Malusi Gigaba’s budget presented to the National Assembly represents a fairly good balancing act in a difficult fiscal environment. The budget is a team effort. It is therefore once again probably a good testimonial to the sober and competent team of officials at the National Treasury, who produced the documentation. Gigaba himself described the budget as tough, but hopeful. This is probably a fair assessment.

Schizophrenic budget a desperate attempt to balance the books – Daniel Silke

Author: Daniel Silke. WHICHEVER way you look at it, Budget 2018 was always going to be punitive and it sure was. All South Africans, especially the poor, are being made to pay for both the excesses of the Zuma era as well as the failure to enact and enable growth-orientated economic policies. The rise in value-added tax (VAT) and fuel levies is largely an attack on the poor and presents a gamble for newly-elected President Cyril Ramaphosa as he seeks to revitalise his own political party ahead of the 2019 elections.