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Taxation
It is important that you as a member, understand the different tax implications when benefits are paid. Let’s take a look at a few:
Retirement Benefits
The first R500 000 payable at retirement from a pension, provident or retirement annuity fund is tax free.
The balance is taxed according to the following fixed scale:
| R0 – R500 000 | 0% |
| R500 001 – R700 000 | 18% of the amount exceeding R500 000 |
| R700 001- R1 050 000 | R36 000 plus 27% of the amount exceeding R700 000 |
| R1 050 001 and above | R130 500 plus 36% of the amount exceeding R1 050 000 |
Death Benefits
The death benefits paid by the UCTRF are taxed exactly the same as Retirement Benefits above.
The first R500 000 payable at death from a pension, provident or retirement annuity fund is tax free.
The balance is taxed according to the following fixed scale:
The balance is taxed according to the following fixed scale:
| R0 – R500 000 | 0% |
| R500 001 – R700 000 | 18% of the amount exceeding R500 000 |
| R700 001- R1 050 000 | R36 000 plus 27% of the amount exceeding R700 000 |
| R1 050 001 and above | R130 500 plus 36% of the amount exceeding R1 050 000 |
Withdrawal Benefits
The first R25 000 of a cash withdrawal will be tax free with the balance taxed as follows:
| R0 – R25 000 | 0% |
| R25 001 – R660 000 | 18% of the amount exceeding R25 000 |
| R660 001- R990 000 | R114 300 plus 27% of the amount exceeding R660 000 |
| R990 001 and above | R203 400 plus 36% of the amount exceeding R990 000 |
Taxation of Contributions
