Africazine:
As the tax year approaches its end, South Africans must act quickly to optimize their finances.
With the tax year running from 1 March to 28 February, taxpayers are urged to prepare now. Warren Ingram from Galileo Capital emphasizes the importance of maximizing savings and minimizing tax liabilities before the deadline.
Maximize Your Retirement Fund Contributions
Taxpayers can deduct up to 27.5% of their taxable income, with a cap of R350,000 per year. For those in the 41% tax bracket, contributing R10,000 can lead to a tax saving of R4,100. It’s crucial to check year-to-date contributions to avoid exceeding the limit.
South Africa: Key figures on Tax Deductions
- 27.5% of taxable income deduction limit
- R350,000 cap on retirement fund contributions
- 10% of taxable income deduction for donations
- 41% tax bracket savings example: R4,100 from R10,000 contribution
Claiming Medical Expenses and Donations
Taxpayers with significant out-of-pocket medical expenses should retain their receipts, as these can qualify for additional deductions. Donations to registered public benefit organizations are also deductible, up to 10% of taxable income, provided taxpayers have a Section 18A certificate.
Final Steps Before Tax Year Ends
- Update your travel logbook for business travel claims
- Gather IRP5, IT3b/c certificates, and medical aid certificates
- Consider hiring a tax practitioner if needed
Act now to ensure you maximize your tax benefits before the deadline.
