Im­plats’ killer shaft

CityPress - - News -

FOR THE RECORD In our story head­lined “Do a Van Rooyen” (Jan­uary 24 2016), we re­ported that the new re­tire­ment tax­a­tion laws “put a cap on how much of an em­ployee’s prov­i­dent fund or pen­sion may be with­drawn when a per­son leaves a job. It is in­tended to force work­ers to save for their re­tire­ment and not with­draw sav­ings to pay off debts or ful­fil short-term needs.”

This law al­ready ap­plies to all pen­sion fund and re­tire­ment an­nu­ity fund mem­bers, and will now be ex­tended to mem­bers of prov­i­dent funds. The law also al­lows one-third of the re­tire­ment sav­ing to be cashed out as a lump sum, with the re­main­ing two-thirds to be an­nui­tised.

Mem­bers will still be able to cash in their funds, but will be li­able for greater tax de­duc­tions. This is in­tended to en­cour­age mem­bers to save for re­tire­ment.

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