Earn under R350,000? Click here to see why you still need to file to get your Tax Refund.
Need help with your 2016 tax return?

Get your tax return DONE in 20 minutes or less with TaxTim!

Try TaxTim now

Try Tim now

Tax on Retirement withdrawal

Posted 16 June 2016 under Tax Q&A
George says:
15 June 2016 at 22:04

I want to know my retirement benefit will be taxed. I withdraw two thirds and leave one third in the fund. How much tax will I pay on the withdrawal and how much will I receive?

This entry was posted in Tax Q&A and tagged , . Bookmark the permalink.

TaxTim TaxTim says:
16 June 2016 at 8:56

When a pension fund is withdrawn or paid out, the fund administrator is required to obtain a tax directive from Inland Revenue to indicate at which tax rate the money should be taxed.

If this is not done, then the money along with your other normal income, will be added together in your tax return and the total will be taxed according to the tax rate in which the total amount will fall of the income tax bracket. Please see a link to the tax scales: https://pwc.taxtim.com/na/blog/individual-income-tax-tables

So get in contact with your fund and request that they obtain a directive once the money is withdrawn.

Hope you manage

George says:
16 June 2016 at 10:52

Thank you. Just one last question. What is the estimated or highest tax they can tax me on.

TaxTim TaxTim says:
16 June 2016 at 11:01

The highest tax rate is 37%.

Get Inland Revenue Tax Dates and Deadlines in your Inbox

We'll tell you when tax season is open and when it closes. Nothing more.