GEPF pensioners line up at office after increase in tax deductions
Some disgruntled pensioners who used to be in the service of government, gathered at the Government Employees Pension Fund’s (GEPF) client service office on October
3 to demand answers after tax deductions resulted in them having received less money than usual at the end of the month.
The group denied having received a communique relating to Pay As You Earn tax requirements and other forms, which officials said were issued via SMS with a September 22 response deadline.
Most of them had been outside of the GEPF premises from 05:00, hoping to be the first ones to receive help when work hours started. By 10:00, however, they had still not been attended to. Many of them told Polokwane Observer that they are not dissatisfied with the tax deductions that had been made, but the fact that this had not been properly communicated to them.
Malet Mamashela, one of the pensioners said the amount of R11 000 was deducted from her personal and spousal monthly pension money and that very little was left. “All these years, they deducted R1 000 to cover tax. I am left with four units of electricity at home, and now I do not even have money for groceries as they took my money,” she said.
GEPF spokesperson Matau Molapo says the implemented directive from the South African Revenue Service is a requirement as per the Income Tax Act, in that the rate of tax deducted from pensioners’ monthly pension payments should be revised.
The deduction applies to pensioners who has more than one source of taxable income in addition to their GEPF pension.
“It is important to note that this choice will result in the fund continuing to deduct tax as in previous months and not in the more accurate effective tax rate as provided by SARS.
This may result in pensioners having to settle a tax debt with SARS at the end of the tax year.
Choice forms will be sent to affected pensioners and will also be available at GEFP offices. Even so, the pensioners have the option to opt out of the revised tax rate provided by the revenue service and revert to the normal PAYE rate applicable to their pension.”
The fund relayed an apology to all pensioners who did not receive the messages sent to them that communicated the changes or requested deadlines, or who might have had difficulty understanding the content.
“Prior to implementing the revised rate of tax, the GPAA wrote to all affected pensioners using the contact details that GPAA has, informing them of the choices they have.
“Some pensioners might have not received the correspondence or did not fully understand the options they had,” she said.