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Tax Code 4006 is less than I supplied, it seems limited

Posted 6 July 2015 under Tax Questions



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NoraJane says:
6 July 2015 at 9:57

Good day,

I completed my tax using efiling but the amount that I am inputting in the SARS code 4006 is showing a lesser amount on the calculated tax result. Is there a reason why amount is being lowered on the calculated result? I supplied an amount of R25000 on the Efiling form and on the Calculate Tax result shows R7700.

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TaxTimTaxTim says:
6 July 2015 at 10:33

Are you saying the refund is only R7700 or the actual deduction is R7700?


NoraJane says:
6 July 2015 at 10:38

Thank you, for the prompt response.
The actual deduction value displayed under Deduction is R7700 not the refund. So I inputted R25000 for 4006 in Efiling. When I click on show Calculations, On the tax calculation result under DEDUCTIONS, the amount displays as R7700 and not the R25000 that I entered.


TaxTimTaxTim says:
6 July 2015 at 10:41

Could you let me know the amounts next to 3697 and 3698 on your IRP5?


NoraJane says:
6 July 2015 at 10:57

Sure. The amounts are:

3697 - 344123
3698 - 53070
4006 - 25986


TaxTimTaxTim says:
6 July 2015 at 11:56

The reason for this is because retirement annuity fund contributions are limited to 15% of what is called Non-Retirement-Funding Employment Income which means non-pensionable earnings. This is represented by the 3698 source code. That is why you are limited to the R7700.


NoraJane says:
6 July 2015 at 12:00

Thank you, very much for your assistance. I have registered with TaxTim and will use TaxTim's definitely use TaxTim moving forward.
Thank you


TaxTimTaxTim says:
6 July 2015 at 12:06

Great, glad we could assist you and looking forward to doing so next year!


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