Time to save?

Tax-free saving accounts were introduced on 1 March 2015 in order to encourage more people to start saving. The annual contribution limit is R30 000 and the lifetime limit is R500 000 per person. This means that if R30 000 is invested per annum, after approximately 17 years a person can accrue a tax-free investment of R500 000. If a person makes a contribution of over R30 000 per annum, however, SARS will penalise them when submitting their tax returns. It appears to be a good way to save or invest as the amounts that are received or accrued from the investment will not be subject to income tax, dividend withholding tax or capital gains tax.

See a related article on Moneyweb: http://www.moneyweb.co.za/mymoney/moneyweb-personal-finance/coronation-allan-gray-launch-tax-free-savings-accounts/

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