I own a business and I draw a standard non- pensionable salary of R1 440 000 (120K p/m). I pay R360k (30k p/m)to an RA. Which means I actually don't earn enough to achieve the max tax destructibility for my RA. However this year for the first time I have other income from share sales (my share trading G&L statement currently reflects a gain of 264K). Will this income add to the non-pensionable salary above and thereby reduce the disallowed portion of the RA Contribution?
Is your business registered as a company? Is your share trading account in your personal name?
Gsays: 1 December 2015 at 11:58
My business is a CC and the share trading account is in my personal name.
TaxTimsays: 1 December 2015 at 18:33
I am assuming you are not a share trader, in which case your gain on share sales is a capital gain. Capital gains are specifically excluded from the definition of non-pensionable income and therefore would not be included in the calculation of the RA deduction that you can claim.
Gsays: 1 December 2015 at 18:35
OK thanks, How does one define a share trader?
TaxTimsays: 1 December 2015 at 21:39
This would be someone who actively trades by buying and selling shares over a short term with the intention of making a profit (as opposed to someone who buys and holds for 3 or more years in order to grow their investment).
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