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How the 2013 budget speech affects you.

 

So, Mr Gorhan recently delivered the budget speech for 2014.  Even though most of the focus was not directed at individual tax, there are still certain updates that will affect you ( and your salary) personally.

  The interest exception:

  • If you are under 65, your new exception for interest earned is R23,800.  This means that the first R23,800 you earn in interest in tax free.

Tax threshold:

  • The new tax threshold for persons under 65 years is R67,111.  This means that if you earn less than R5.592.58 per month, you don’t have to pay any tax.

Medical deductions:

  • You can reduce your tax payable by taking out medical insurance.  The new tax rate are you will get a deduction of R242 per month that you are with a medical aid, and a deduction of R162 per month for each of your beneficiaries on your medical aid (such as your children).

 Contributions to a retirement scheme:

  • If you contribute to a Retirement Annuity Fund, you will qualify for a deduction as well.  You will be able to deduct up to 27.5% of the greater of:
  • Your employment income
  • Your taxable income

However, this provision is limited to a maximum deduction of R350,000.

So therefore, if you are in the position where you have to pay tax, try claim as many deductions as legally allowed, as it will save you lots of money at the end of the day.  If you struggle with tax and all it implications, consult a tax professional.

 

Wayne Coetzee Chartered Accountants

 

Brought to you by Wayne Coetzee & Associates Chartered Accountants

For more info visit: http://www.wcca.co.za/