Visit Nedgroup
Investments for a comprehensive range of South African and offshore unit
trust portfolios to suit your investment needs.
To encourage us to manage our money better, government has
introduced tax-free investments.
In the above example, Thandi has a tax rate of 40%, pays
total costs of 0.55% per annum on this fund and earns inflation plus 5% (i.e.
11%) per annum on her investments.
The TFSA amid existing saving opportunities
Investment vehicles available in South Africa can be
classified as either retirement savings (pension fund, provident fund,
retirement annuity) or discretionary savings (direct JSE investment, unit trusts,
property, bank savings).
Saving for retirement is already encouraged as your monthly
contribution reduces your taxable income. Also, no tax is paid on dividends or
interest during the investment term and if your money is transferred to an
annuity at retirement, no tax is charged on it. Withdrawal prior to retirement
is, however, discouraged by tax charges. Discretionary investments do not
reduce your taxable income and are subject to tax during an investment term as
well as at withdrawal.
The TFSA, as depicted in the table below, will in contrast
not be taxed during or at termination of investment term. As a result, the TFSA
can be ideal as a long-term discretionary investment option on top of your
existing retirement and discretionary savings.
The TFSA amid existing saving opportunities
Investment vehicles available in South Africa can be
classified as either retirement savings (pension fund, provident fund,
retirement annuity) or discretionary savings (direct JSE investment, unit
trusts, property, bank savings).Us Website http://www.nedgroupinvestments.co.za
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