In March 2016, the Taxation Laws Amendment Act (2015) was signed into law by President Jacob Zuma. This directly affected how retirement funds are taxed.
Provident fund members, who receive a lump sum upon retirement, now benefit from a larger tax deduction on contributions that are made to their fund. This has increased from 20% to 27.5% of taxable income. If employees currently contribute to their fund, they will see an increase in their take-home pay because of this higher tax deduction.
Continue reading The new Provident fund legislation and how it affects you