n Personal Finance Newsletter - Retirement reform at a crossroads : retirement planning

Volume 2014, Issue 406
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Taxpayers are likely to have to wait another two years before they will be able to claim an increased tax deduction for contributions to pension and provident funds and retirement annuities. This follows a recent proposal to Parliament by National Treasury to delay the implementation of the tax harmonisation on retirement funds from 1 March 2015 to 1 March 2017. The earlier proposal would have allowed individuals to claim a tax deduction of up to 27.5% of the greater of remuneration and taxable income on contributions to a pension, provident, or retirement annuity fund, and was an effort to harmonise the tax treatment of these retirement vehicles. Currently the deduction is significantly lower, and the tax treatment of the various vehicles differs.

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