National Treasury has just delivered the 2018 Budget Review. Again, due to a persistent Budget deficit, certain taxes were raised. An increase in VAT to 15% is the headline story, but for individuals in the top four income tax brackets the range of the income brackets was not adjusted for inflation. In effect, your clients will therefore have less real income left after tax in the coming year.
There is a way to build your own investment portfolio and be rewarded with a tax refund. Contributing to a retirement annuity (RA) holds the best of both worlds: build long-term wealth and reap the tax benefits. Exactly how big are the benefits?
The three-year anniversary of the first tax-free unit trusts launched in 2015 is coming up and you’ll be pleasantly surprised at the superior three-year returns compared to their standard, taxable counterparts, particularly for pure equity and high equity funds. Not paying any dividends tax now and no capital gains tax in future will make a dramatic difference to your pocket. So, make sure to use this tax year for planting the seeds for a tax-free harvest in future.
It’s nearly the end of the tax year and across the industry investors are urged to max out their tax-free savings account (TFSA) and retirement annuity (RA) before 29 February 2020. We compare an RA and TFSA here to make it easier for you to choose one – or both.