SARS Tax Free Investments: What Exactly Is Tax Free Investments? Tax-Free Investments were created as a way to encourage people to save money. From March 1, 2015, this reward will be available. The returns on these investments are not subject to income tax, dividend tax, or capital gains tax. A person’s lifetime and annual limits are both imposed.
sars.gov.za Tax Free Investments : South African Revenue Service
Organisation : South African Revenue Service [SARS]
Facility Name : Tax Free Investments
Applicable For : Taxpayer
Country : South Africa
Website : https://www.sars.gov.za/types-of-tax/personal-income-tax/tax-free-investments/
What Are the Benefits of Tax-Free Investments?
Only a licensed bank, long-term insurers, a manager of registered collective schemes (with certain exceptions), the National Government, a mutual bank, a co-operative bank, the South African Postbank, and a person authorised by a licensed exchange to perform one or more securities services in terms of the exchange rules may provide tax-free investments. The Minister must publish a list of service providers in the Gazette. Only the aforementioned are designated under the existing Regulation.
| Year of assessment | Annual limits |
| 2016 | 30 000 |
| 2017 | 30 000 |
| 2018 | 33 000 |
| 2019 | 33 000 |
| 2020 | 33 000 |
| 2021 | 36 000 |
Note that any portion of unused annual limit is forfeited (that is, it is not carried forward to the subsequent year of assessment).
Which Investment Accounts Will Be Tax-Exempt?
Following Accounts Will Qualify As Tax Free Investments \s
- Fixed deposits \s
- Unit trusts (collective investment schemes) \s*
- Retail savings bonds
- Certain endowment policies offered by long-term insurers
- Linked investment products
- Collective investment schemes
- Exchange traded funds (ETFs).
What Should I Do Next?
Inquire about investing in a tax-free investment with a service provider.
- Total contributions per tax year;
- Total amounts withdrawn per tax year;
- Total sums transferred per tax year;
- Total returns on investment, such as interest, dividends, capital losses, and capital gains, shall be provided to SARS twice a year.
The service providers will supply this information to these taxpayers on an annual basis by providing an IT3(s) Tax Free Investment certificate.
Contact
Call the SARS Contact Centre at 0800 00 SARS (7277) 0r Go to a SARS branch near you.
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