| Tax year 1 March 2011 to 29 February 2012 | Tax year 1 March 2012 to 28 February 2013 | ||
| Below age 65 | R59 750 | Below age 65 | R63 556 |
| Age 65 and over | R93 150 | Age 65 and over | R99 056 |
| Age 75 and over | R104 261 | Age 75 and over | R110 889 |
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HV Hermanides says: 28 February 2012 at 12:31 What is the medical deduction limitations for over 65 for the tax year 2013 |
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TaxTim says: 28 February 2012 at 13:49 Dear HV, Thank you for your question. There have been no changes to the medical deductions for those over 65 years of age. Expenditure will be allowed as a deduction, the same as before. There will be a new scheme from 2014, but that will be to the benefit of taxpayers over 65 years of age and allow even more of a deduction. I hope this answers your question? Regards, Tim |
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ascii says: 11 March 2012 at 20:13 Excellent article, thanks for sharing! |
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TaxTim says: 11 March 2012 at 20:17 Dear Sascha, Thank you very much, comments like these are always appreciated! Regards, Tim |
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Gitika Summers says: 19 March 2012 at 11:19 Hi, I am interested in knowing how to save money without being taxed on it. Any advice? I do not have a pension fund and have not had one for a while. I would still like to save money for retirement but do not know how to do that without giving a chunk of it to the government. Please help! Thanks. |
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Eugene says: 20 March 2012 at 15:51 Hmm, a R1500 increase and R2000 more taxes!!! Why do we even get increases?! |
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TaxTim says: 20 March 2012 at 16:41 Hi Eugene, I have to ask how that happened? Generally it should not work that way at all. Regards, Tim |
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TaxTim says: 20 March 2012 at 16:45 Dear Gitika, Great question! The best routes to take would be to invest in an Equity Fund such as Allan Gray, Coronation, Liberty etc as the returns from those are in the forms of dividends and interest. These returns are taxed, but at a much lower rate in some cases and there is room for growth as well. Alternatively putting your money in a money market gets you a stable return on your investment. If you invest in a Retirement Annuity Fund then you can claim a tax deduction each year and at the age of 55 you will get a lump sum payout and an annuity for life. There will be some tax on this however. Unfortunately for you TaxTim is not a financial planner and the law doesn't allow me to give full on planning advice. If you email me via the helpdesk I will put you in touch with some names of advisers to consult with if you would like. Regards, Tim |
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Hawa Bebe Sattar says: 2 May 2012 at 11:28 Hi Tim, The 50% proposed nominal tax on mining companies. How did this decision arise? What is the purpose and where will it flow to and who gets the royalties? Thanks Bebe |
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TaxTim says: 6 May 2012 at 13:01 Dear Bebe, As far as I am aware the decision came from the much discussed mining charter and the need for greater tax revenue. The government would be the recipient of these funds, as for what they do with them I cannot answer. In theory it should go to public works programs and social up-liftment, but we wait and see. Regards, Tim |
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chuck says: 16 May 2012 at 15:18 what do you think the inflation rate will be for 2013 |
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TaxTim says: 17 May 2012 at 17:01 Hi Chuck, Well speaking as a tax professional and not an economist it would be difficult for me to speculate, but I’d go so far as to say that we’re probably looking at an inflation rate of between 5-7% that’s of course if there aren’t any massive global catastrophes. Regards, Tim |
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gjd says: 30 May 2012 at 12:49 Hi Tim - Being a contract worker what options do I have to reduce tax deductions? At the moment Iam on a 6 month contract but cant be assured of continued work. Pls help. |
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TaxTim says: 4 June 2012 at 11:32 Hi Grant, Thanks for the question. In general a contracted working taxpayer can deduct any expenses that are made in earning that income. These are only business expenses, so remember to separate those from personal expenses. Keep a separate record and when you do your tax return enter these expenses and this will reduce the tax you have to pay. Please continue asking away if you have any other queries. Regards, Tim |
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Meisha Mulla says: 16 June 2012 at 22:58 Hello Tim, Thank you for a very informative blog. I am a network marketer. I'm just beginning to earn a monthly residual income, it's still under R500 a month. I have not looked into the tax part of things yet. Even my earnings still go into my personal account. What should I do going forward? Do I need the services of a general accountant or someone who specialises in taxes? Some direction would be much appreciated. Thanks in advance. - Meisha |
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TaxTim says: 18 June 2012 at 16:30 Hi Meisha, Thank you for the compliments and keep reading! What do you mean by monthly residual income? As in disposable income after expenses? Is this income separate from your main income? If this is a side business which is separate to your normal income then any expenses you incur which leads you to earn this income can be deducted against the income earned. Remember only those directly related. I suggest keeping a spreadsheet of all this income and expenses. For now getting an accountant would be costly given what you earn, would you like some direct contact though. Tim can email you directly to discuss further if you are speaking about a full ob business? Regards, Tim |
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tertius says: 3 July 2012 at 22:18 hi tim my employer deducts 25 percent of my salary automaticaly each month as tax. My total income from 1 march 2011-29 feb 2012 was R55 400, can i claim the total of R13 850 that was deducted through the year as a rebate, because i fall under the threshold? |
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TaxTim says: 4 July 2012 at 9:16 Hi Tertius, Thank you for the question! Did you work the whole 12 months of the year and are a fully salaried employee? Your salary fell below the taxable threshold of R59 748 for the 2012 tax year and usually NO amount of PAYE should have been deducted, only a small amount for UIF. When you submit your return you should be entitled to this amount as a full refund. Regards, Tim |
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Reinhardt says: 16 July 2012 at 14:17 Dear Tim I'm a bit clueless on these tax matters. I was just wondering what is the min amount I need to earn to register as a taxpayer or do I need to register regardless of what I earn. Regards Reinhardt |
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TaxTim says: 16 July 2012 at 16:13 Hi Reinhardt, Thanks very much for the question! I think a lot of South Africans are feeling this way at the moment. For a brief explanation on exactly how tax is calculated, I wrote a blog you may find useful. For the 2013 tax year, that runs 1 March 2012 - 28 February 2013 you need to earn more than R63 556 to qualify to pay tax. However even if you earn less than this your employer may still submit your details to SARS so it would be worth registering anyway. My advice is to register regardless. That way you are always compliant and ready for when you do need to start paying tax. If you go to www.taxtim.com we guide you through the registration process as well and provide the relevant documentation so you can register and become tax compliant. I hope this helps, if you have any further questions you can always email me on the helpdesk. Regards, Tim |
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Melody says: 30 July 2012 at 11:39 Hi Tim Quick question. If I make 83000 in a year. Will only the part above the threshold be taxed at 18%, or the whole amount? Thanks! Melody |
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TaxTim says: 30 July 2012 at 12:51 Hi Melody, You are correct, so the difference between R83 000 and R63 556 and therefore will only pay tax on R19 444 which will be R3 499.20. Try our TaxTim salary calculator to see how much after tax income you get into your account each month. Regards, Tim |
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Marc says: 12 August 2012 at 20:27 Hi Tim, Please can you advise if I'm supposed to be paying tax on interest earned from a fixed deposit investment or a general savings account? Say, I invest R100 000 in a fixed deposit at 8% interest per annum, will I have to pay tax on the R8 000 interest I earn per year? I see you mentioned that there seems to be an exemption for interest earned of R22 800 but not sure if this is confirmed? Thanks Marc |
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TaxTim says: 12 August 2012 at 21:44 Hi Marc, Any interest earned from a bank account/fixed deposit or investment which exceeds R22 800 per year will be subject to tax, provided you are under the age of 65. So effectively at an interest rate of 8% you would need to have invested at least R285 000 before you would start paying tax on interest earned. I hope this helps? Please keep the questions coming! Regards, Tim |
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Keith says: 23 August 2012 at 1:04 Hi Tim, I,m a bit confused here or it's the lateness of the hour! On 30/07/2012 you reply to Melody that she would pay tax on the difference between her income & the tax threshold. Therefore by the same logic if I am +65 my threshold is R99 056 & I am self employed & I make R145 000 in a tax year I only pay on the difference? ie R45 944 x 18% = R8 269 Which begs the question, what about the rebate R17 830 ---- SARS will be paying me! What have I missed? Thanks for a great BLOG Keith |
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TaxTim says: 23 August 2012 at 9:18 Hi Ketih, Thanks for the compliments on the blogs and I'm glad you are enjoying them! Is that the amount calculated on your ITA34 from SARS after you have submitted your ITR12 tax return? As a self-employed income earner you are most likely deducting all business related expenses which brings your taxable income down to the R145 000. On your provisional tax return you may not have taken these expenses into account and would have paid provisional tax on the total income earned. IF that was the case then when, at year end, you include the deductions this would adjust the actual tax payable right down, thus the large refund. That amount as a refund is very high given your taxable income though. I'd be very interested to see your tax calculator or perhaps the ITA34 if you'd like to send it to our helpdesk for me to have a look? How did you complete your provisional tax returns? Regards, Tim |
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Christo says: 26 September 2012 at 17:26 Hi Tim My question: Say I have an investment of R10 million in a Money Market account at a bank earning interest of 4.5%. What tax rate applies to the interest earned on this investment? Does the tax rate increase on bigger investments ie R100 million or more? Thanks Christo |
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TaxTim says: 27 September 2012 at 8:13 Hi Christo, Thank you for the question! Tax on interest earned from a local source would be taxed at your marginal rate of tax. The first R22 800 is tax free however, so any interest above that is taxed in your hands. R10m at 4.5% attracting R450 000 per year, assuming there is no other income earned for that year would amount to R92 000. Investments of R100m would attract tax at 40% of the interest earned. Interest is taxed as per the normal income tables except for the first R22 800. Regards, Tim |
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jim says: 16 October 2012 at 15:21 Hi Tim Think you missed Keith's point He calculated his tax as 18% over threshold then still wanted to take off the rebate The rebate of R 17830 is the threshold R 99056 * 18% (same thing) so Keith wants it twice Jim |
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TaxTim says: 17 October 2012 at 0:51 Hi Jim, Thanks for pointing that out. Quite rightly the only tax paid is the difference between the amount of taxable income and the tax threshold multiplied by the relevant percentage. This is exactly the same as taking the total Taxable Income and multiplying it by the tax percentage and then subtracting the primary rebate. For example (2013 year): TI - R150 000 Tax threshold - R63 556 Primary Rebate - R11 440 1. (150 000 - 63 556) *18 % = R15 560 or 2. (150 000 *18%) - 11 440 = R15 560 So either way the same answer is achieved. The primary rebate is the tax threshold multiplied by the 18% minimum tax rate. Regards, Tim |
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