Managing Trauma Relief A Practical Model to assist managers who needs to deal with their employees' trauma effectively. Written by Barbara and Wynand Louw. To be released soon! Other books are available in this series Click here |
Welcome to AFSonline
Budget 2012 Highlights
Tax tables
| INCOME TAX: INDIVIDUALS AND TRUSTS |
Tax rates (year of assessment ending 28 February 2013)
Individuals and special trusts
| Taxable Income (R) | Rate of Tax (R) |
|
0 - 160 000 |
18% of taxable income |
|
160 001 - 250 000 |
28 800 + 25% of taxable income above 160 000 |
|
250 001 - 346 000 |
51 300 + 30% of taxable income above 250 000 |
|
346 001 - 484 000 |
80 100 + 35% of taxable income above 346 000 |
|
484 001 - 617 000 |
128 400 + 38% of taxable income above 484 000 |
|
617 001 and above |
178 940 + 40% of taxable income above 617 000 |
Tax Rebates
| Rebates | |
|
Primary |
R11 440 |
|
Secondary (Persons 65 and older) |
R6 390 |
|
Tertiary (Persons 75 and older) |
R2 130 |
Tax Thresholds
| Age | Tax Threshold |
|
Below age 65 |
R63 556 |
|
Age 65 to below 75 |
R99 056 |
|
Age 75 and over |
R110 889 |
Note: the tax threshold is above the SITE limit - therefor there is effectively no more SITE.
Medical Tax Credits
Medical tax credits replace the medical aid cap amounts used over the last couple of years.
- Individuals who are 65 years and older still have the benefit of a medical aid tax deductible deduction, subject to no limit.
- Employees who are younger than 65 however, no longer have the benefit of a medical aid tax deductible deduction. They do however qualify for a monthly medical tax credit (MTC).
- The MTC will be deducted from the tax calculated for the employee for each month the employee contributes to a medical scheme, reducing the employee's tax due each month.
- The MTC is calculated in relation to the number of beneficiaries on the medical aid - the values are R230 for the main member, R230 for the first dependant and R154 for each additional dependant
The result of this change is a more equitable benefit for all individuals who belong to medical aids. Lower income employees will "see" a greater tax benefit than higher income employees when comparing February and March tax amounts.
Subsistence allowances and advances
An employee is entitled to receive a subsistence allowance when the employee is obliged to spend at least one night away from his or her usual place of residence.
The value of the deemed allowance or advance where the accommodation is in the RSA is:
- R303 per day for meals and incidental costs and
- R93 per day for incidental costs only.
The schedule of rates for accommodation outside the RSA will be gazetted towards the end of the month.
Table for calculation of rate per km/travel allowance
The fuel and maintenance cost values were amended. It is advisable to recalculate the value of all employees' travel allowances from March 2012.
| Value of the vehicle (incl. VAT) | Fixed cost | Fuel cost | Maintenance cost |
|
(R) |
(R p.a.) | (c/km) | (c/km) |
|
0 - 60 000 |
19 492 |
73.7 |
25.7 |
|
60 001 - 120 000 |
38 726 |
77.6 |
29.0 |
|
120 001 - 180 000 |
52 594 |
81.5 |
32.3 |
|
180 001 - 240 000 |
66 440 |
89.6 |
36.9 |
|
240 001 - 300 000 |
79 185 |
102.7 |
45.2 |
|
300 001 - 360 000 |
91 873 |
117.1 |
53.7 |
|
360 001 - 420 000 |
105 809 |
119.3 |
65.2 |
|
420 001 - 480 000 |
119 683 |
133.6 |
68.3 |
|
exceeding 480 000 |
119 683 |
133.6 |
68.3 |
Kilometre rate for reimbursed km
The SARS prescribed rate per kilometer increased from R3.05 to R3.16.
Accommodation fringe benefit
The value of "B" in the formula used to determine the value of the accommodation fringe benefit remains unchanged at R59 750.00
Retirement reform: changes suggested for March 2014 only
From March 2014 an employer's contribution to retirement funds on behalf of an employee will be treated as a taxable fringe benefit in the hands of the employee. Individuals will from that date be allowed to deduct up to 22.5 per cent of the higher of taxable income or employment income for contributions to pension, provident and retirement annuity funds with a minimum annual deduction of R20 000 and an annual maximum of R250 000. For individuals at least 45 years of age the deductible amounts will be up to 27.5% with a minimum annual deduction of R20 000 and an annual maximum of R300 000.
For any enquiry, or for help, please contact us.
Last Updated (Monday, 05 March 2012 14:28)
Dividends earned from local shares will become taxableI found this article written by Evan Andreou, Investment Specialist, Fairbairn Capital,and felt that it will be of ineterest to you. From April 1, dividends earned from local shares will also become taxable once they are paid to an investor who is not exempt from dividends tax. Unit trust management companies will receive the dividends tax-free, but dividends tax will become payable once the dividends are paid out to you or they accrue to you (the company uses the dividends to buy more units). Is this a reason to panic? I don't think so; it's going to take some getting used to but the nett effect to investors is likely to remain unchanged and there may even be an unintended opportunity in the change, giving us something to potentially market. (More on this later) Let's look at the past to give us some context: Dividends were paid by companies from their after tax profits. In addition to company tax there was also a Secondary Tax on Companies (STC)payable at a rate of 10%. On 1 April the STC falls away and is replaced by a withholding tax on dividends. This dividend withholding tax is at a rate of 10%. Therefore the effect on investors is likely to be neutral as in both cases a 10% tax was effectively levied on dividends; all that is changing is where this tax gets paid in the 'food chain'. In terms of tax legislation, unit trust companies have been appointed as withholding agents and from April 1 will have to deduct the tax owed from the dividends paid out or that accrue to investors, and pay it over to SARS. Individual investors in unit trust funds will in all likelihood not notice the introduction of dividends tax, because unit trust companies will pay the tax for investors; you will not receive a smaller dividend - the tax will be deducted by the unit trust company rather than by the company that paid the dividends, but the net amount will remain similar. You will be exempt from dividends tax if you have invested in unit trusts or shares through your retirement fund. In my opinion this gives an RA a potential additional performance boost Unit trust funds receive dividends from the shares in which they invest on your behalf, and also earn interest from cash deposits and bonds. Up until now, you have had to pay tax only on local and foreign interest and on foreign dividends,up until now, your unit trust company has sent you a tax certificate that states how much interest you earned from your investments during the tax year, and you have been required to declare this amount on your income tax return. The tax for which you are liable on interest earnings can be reduced by the annual exemption. For the 2011/12 tax year, if you are under the age of 65, you can earn R22 800 in interest before you pay tax on interest, and if you are 65 or older, you can earn R33 000 in interest tax-free each year. In the next tax year (March 2012 to February 2013), your unit trust management company will send you a tax certificate that will state not only how much your unit trust investment earned in dividends from April 1 but also how much dividends withholding tax was deducted from these dividends and paid to SARS on your behalf. You will need to declare these amounts on your tax return, but you should not owe any tax on these amounts, because the tax would have been paid on your behalf. The government has decided to replace STC with dividends tax because most other countries have a dividend tax on shareholders rather than a tax on dividends paid by companies. It has been difficult to explain STC to foreign investors, and the addition of STC to the company tax rate has made South Africa's corporate tax rate appear to be uncompetitive. All that has effectively happened is the entry point on the accounting ledger has changed, but the end result for investors is pretty much the same Please feel free to contact me should you have any questions. Wynand Louw GAP Co-Pay Combined Cover
Last Updated (Saturday, 25 February 2012 20:36) |
||||||||||||||||||



















