As we enter into the final month of the tax year for 2023 we still have some time to take advantage of some tax opportunities.
Even if you don’t have the resources to take full advantage of these any contribution will make a difference to your tax payable.
Retirement Annuity
You can deduct up to 27,5% of your taxable earnings on contributions to retirement funding. So if you have a pension fund and you contribute 15% towards it you can invest a up to 12,5% more into a retirement annuity. This can be done with a lump sum adding it to your existing retirement annuity.
Tax free savings account
You should consider the opportunity of investing a lump sum into a tax free savings account before the tax year end. You are currently allowed R36 000 per annum. So you can top up to this amount before the end of February taking full advantage of the allowance and then be in a position to invest more in the next tax year from March onwards.
Capital gains tax
If you are disposing of any investments you could sell some in February using your R40 000 exclusion off the gain in this tax year then sell again in March taking up your R40 000 exclusion for the new tax year.
Donation tax
If you are considering donating assets up to R200 000 to someone other than your spouse you should split the donation between February and March. This way you will take full advantage of the R100 000 per annum.
Planning opportunities exist in the month of February for the tax savvy. Work with the various tax breaks and take full advantage while you can.