09/12/2015
December 2015
URGENT UPDATE ON RETIREMENT REFORM - Hot off the press
Retirement Reform to be approved for implementation 1 March 2016
Both Houses of Parliament have passed the so-called T-Day provisions of the Taxation Laws Amendment Bill which will apply from 1 March 2016. It is expected that the Bill will be assented by the President later this month, or early in January 2016.
What would this mean for CRF members?
The two main changes affecting CRF members are:
1. Your total 27% contributions to the CRF will be tax deductible; so for some members, your take home pay could increase slightly. Your employer’s contributions to the fund will be taxed going forward, but you will be able to deduct up to 27,5% of your remuneration or taxable income in respect of your contributions, so in effect your total 27% contributions to the Fund (9 + 18) will be tax deductible. You will even be allowed to make a 0.5% additional provision for retirement tax free.
2. The rumour is that all members of all funds will now only be allowed to take a maximum of one-third of their retirement benefit as a cash lump sum. Is this true?
Good news for our current CRF members!
A. Our members belong to a Provident fund, so any CRF members, older than 55 will not be affected; which means you can take out your FULL cash lump sum when leaving the CRF. For members over 55 their future contributions to this fund with growth can also be taken as a cash lump sum.
B. All CRF members younger than 55, can take their full value saved up in the CRF as at 1 March 2016 as a cash lump sum including all future growth thereon.
C. CRF members will be allowed to take 1/3rd of their contributions and growth thereon from 1 March 2016 and will be required to purchase an annuity with the remaining 2/3rds. This will only be effective when a member’s contributions and growth from 1 March 2016 exceeds the legislated minimum cash amount of R247,500.
Die Verandering in wetgewing bring mee dat met die Regte Aftree Beplanning en gebruik van Belasting vergunnings dat kliente meer kan spaar en minder belasting kan betaal. Vir Volledige Aftree Beplanning kontak ons . Tel 044 6903258 of 083 263 1412. Marnus Ferreira. Gemagtigde Verteenwoordiger van Accredinet Financial Solutions. FSB nr 8933