Tax benefits 2021

We all need a break at some point. Why not take a tax break to start off 2021? The end of the tax year, 28 February 2021, is fast approaching and we urge you to contact your Origin financial planner, adviser, or tax consultant at your earliest convenience in order to arrange the correct structuring in your portfolio to qualify for an additional tax deduction in time. 

The Origin group offers the following tax saving advice and products to help you maximise the tax benefits offered through investments, risk management products and legislation: 

INDIVIDUAL AND GROUP RETIREMENT ANNUITIES & PENSION FUNDS 

Contributions to pension, provident or retirement annuity funds are tax deductible up to 27.5% of one’s gross remuneration or taxable income (whichever is higher), subject to an annual maximum of R350 000. 

Additional advantages of retirement funds include: 

• Tax free growth in your investment. 
• Favourable tax treatment on lump sum proceeds at retirement or death. (The first R500 000 is tax free, while the rest is taxed at favourable rates) 
• Retirement funds are protected against creditors and, as a result, insolvency. 
• Withdrawals from other retirement funds, such as employer funds after resignation, can be transferred to retirement annuities free of tax. 

• Retirement funds are exempt from estate duties and do not form part of your estate, providing you with savings on executors’ fees as well. 
• It provides a monthly income in retirement with various options available.  
• Group Retirement Annuities can form part of your employee benefits, with one benefit being that of a reduction in taxable income. 
• Origin offers a range of actively managed model portfolios and fund choices to enhance communication from fund performances, optimise market opportunities, and keep costs as low as possible for our clients. 

TAX FREE SAVINGS 

With a tax-free investment, you do not receive immediate income tax relief, but your fund will grow, free of tax, while you remain within the tax-free savings product. Every year, you can invest up to R36 000 in tax free savings accounts, with a lifetime limit of R500 000. When you do make a withdrawal, or at maturity, you will not be taxed on the proceeds either. A variety of funds are available to be invested into, and can be structured according to your specific need, risk, and time of investment. 

STRUCTURED INSURANCE 

Through Santam Structured Insurance, we offer business owners a unique way of insuring their assets, where they can create and increase their insurance capacity over a period and retain more risks or higher deductibles than through a standard business short term insurance policy. 

Here are a few benefits of what specialised structured insurance can offer: 

• Additional risk cover. 

• Improvement of cash flow benefits. 
• The creation of self-insurance capacity for uninsurable or expensive risks. 
• Lump sum or monthly contributions are accepted. These are short term insurance premiums and deductible for income tax purposes.  
• It can be structured as a stand-alone and as a supplement to your traditional short term insurance benefits. 

TAX RISK POLICY 

Have you or your business been selected for an audit by SARS? If so, additional accounting and fees towards tax specialists can often become unaffordable. Origin offers a tax risk policy to look after these unforeseen additional accounting fees or appoint a team of tax professionals who will defend you. The cover can provide for Income tax audits, VAT, Employees tax, CGT and other dispute resolution hearings and appeals to the Tax Board and Court.  

To ensure you do not miss out on any of the tax saving opportunities for 2021, contact our team of financial advisors by latest middle February in order to add an appropriate lump sum contribution to your Structured Insurance product, tax free savings account or Retirement Fund. Your financial planner can calculate the correct contribution to maximise your tax deduction for the tax year. With little time left to make the most thereof, do not let the opportunity pass you by. 

This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your adviser for specific and detailed advice. Errors and omissions excepted (E&OE).