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Who knows re: Tax and Pension?

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Not applicable
I read about the new tax calculation (effective from October) for someone taking a lump sum from their retirement fund. Also about the National fund (probably from 2010). My question is whether I'll pay more tax if I take my withdrawal benefit (i.e. by resigning, taking another job - I'm not of retirement age yet) after October '07. The professionals I asked either don't know yet, or else they're not very professional. Any advice /discussion??
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12 REPLIES 12
Not applicable
Check out www.persfin.co.za there may be some FAQ's that can help. In general it is always the best principal to defer paying tax as long as possible, but this is all dependant on your financial situation. You can always transfer any accrued pension monies to another approved pension fund/retirement product without paying tax when you leave/move to another job.
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Not applicable
Hmmmm....all of a sudden my tax post aint so stupid.
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Preston
Super Contributor
Richie77 ,you are becoming extremely annoying and stop promoting yourself. Just as Simon brought out the censorship on foul language , censorship on promotion of service could be next on the list.. I feel that you are going beyound the spirit of the Code (PAAB) . Secondly to the forumite . If you are not of retirement age , why do you think of withdrawal. I used to audit Pension Fund during by article year and what i found that the growth rate for members with a larger Share of Fund (SOF) is far more greater than the rest if the other memeber. Your Pension Fund grow at a really alarming rate during the latter part of your employment. Let your money grow in that Fund.
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Maddog
Regular Contributor
I agree ( with the latter part of your posting) nothing beats compound interest im not promoting pension funds but if you have them keep them
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CHATTYCHAT
Super Contributor
Mammon: the "benefit" after Oct 1 is for those who are taking up pension status, which you are not. Transfer your withdrawal benefit to the new employer's fund, otherwise transfer to a preservation fund (no tax due as Preston has said). If you need the withdrawal benefit for personal reasons, you are going to pay S A R S his share @ more or less your marginal tax rate.
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Not applicable
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Preston
Super Contributor
Greg , as i recall, you are quiet the expert in the tax field. Why do you offer your opinion to the forumite on the tax implication. Your prior posting does not say much to help him?
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geordie1
Super Contributor
I agree new tax concessions nothing to do with withdrawal.I think first R300000 tax free at retirement.My advice would be to make amount paid up unless you need money.If you transfer to another fund, as a sensible alternative, check that this transfer attracts no admin or commission fees.If you transfer to a preserver you are likely to attract admin and commission unless you negotiate something up front.
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Preston
Super Contributor
Mr C. You are quiet the expert in the tax field. What profession are you in? I really enjoy reading your posting.
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Not applicable
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CHATTYCHAT
Super Contributor
Greetings. Compliments returned, Preston. Thanks for asking. Should I answer, will that then reflect advertising? :-) I am in the same line that you seem to be, although a SAIPA. Working for listed co. At present involved with HR stuff and what you may call being a J of (NOT j-off) all trades and master of none.
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Preston
Super Contributor
HR is quiet an interesting function. There is many compliance issue that need to be addressed. Thanks for your response.
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