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Provident fund transfers to Retirement Annuity - are there tax implications?

Posted 2 July 2013 under Tax Questions



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I had a Provident Fund with my previous employer, I changed jobs in November 2012 and transferred the funds from the Provident Fund into a Retirement Annuity. I contributed towards the Retirement Annuity in my own capacity from November 2012 - February 2013. When asked to enter a Retirement Annuity contribution for the 2013 tax year, do I only need to enter the amount contributed from November 2012 - Feb 2013 or does the RA contribution amount also need to include the funds transferred from the Provident Fund as well?

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TaxTimTaxTim says:
2 July 2013 at 23:42

There are certain tax rules when changing from one fund to another, but for the contributions you should only enter what you contribute to the RAF when you started contributing, so November.


Confused says:
3 July 2013 at 9:06

Thanks Tim!

I received an IRP5 for the Provident Fund transfer to Retirement Annuity - does this IRP5 somehow need to reflect in my tax return?

The IRP5 for the Provident Fund transfer has values under these source codes:

INCOME RECEIVED 3920
GROSS NON-RETIREMENT INCOME 3698

Thanks for your help, I really appreciate it.


TaxTimTaxTim says:
3 July 2013 at 23:49

The IRP5 should already be on your ITR12 income tax return on eFiling. If it is not there then you must add the details on eFiling in order that everything is complete and accurate. Is there a directive code in the bottom right hand corner of this IRP5?


Confused says:
4 July 2013 at 6:52

There is a directive number on the bottom right hand side of the IRP5. The IRP5 is not on my ITR12 income tax return on SARS efiling. Does this mean that it needs to I need to indicate this as an additional tax return on the efiling form and add the details?


TaxTimTaxTim says:
4 July 2013 at 22:28

Yes I would do that and then if SARS request supporting documentation you can send the document into them.


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