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Retirement Benefits - Coggle Diagram
Retirement Benefits
1. Funds
-
Annuities from Funds
-Choice between Guaranteed Annuities & Living Annuities
-Both are par(a) Gross Income
-Resident= 100% GI
-Non-Resident= SA source portion in GI s9(2)(i)
Exemptions
-s10C
-s10(1)(gC);
•10(1)(gC)(i)= SA Resident exemption "social security pmts"
•10(1)(gC)(ii)= SA Resident worked outside SA, received from FOREIGN funds. Link to s9(2)(i).
Lump Sums from Funds
-Resident Include amount of lump sum received after DEDUCTING tax-free portion par(e) GI
-Non-resident includes only portion relating to SA source s9(2)(i).
-Tax-free portion= Valid transfers between funds & contributions not allowed under s11F (excess)
-Deemed to accrue @ earlier of; election by member, transfer of funds, or death (immediately prior).
Exemptions
-s10(1)(gC) after deducting tax free amounts as in Annuities
Valid transfers between funds;
2021 YOA
•Prov --> Any
•RAF --> RAF
•Pension --> RAF or Pension
From 1 March 2021
•Any transfer valid BUT RAF can only go to RAF
2. Employer Pay-Outs
Annuities from ER
-GI par (a)
-Exempt under s10(1)(gC)(ii) if EE worked outside SA (ER is SA resident)
Lump Sums from ER
-par(d) or (f) GI
-Exempt under s10(1)(gC)(ii) of EE worked outside SA (ER is SA resident)
Tax Payable
Classification of Lump Sum
-Severance Benefit, or
-Retirement Benefit, or
-Withdrawl benefit
-
Retirement
-Retirement, or
-Death, or
-Termination of service, or
-Conversion of annuities
Withdrawl
-Withdrawl of funds, or
-Resignation from fund, or
-Transfers between funds, or
-Divorce withdrawals (after 1 Mar 2012)
-
3. Purchased Annuities
-Does not form part of pension or retirement contributions
-Pay-outs from annuity will be GI under par(a)
-Capital element exempt under s10A (given)
-But s10A only applies if annuity was purchased by TP or TP's spouse