Page 6 - P6 Slide Taxation - Lecture Day 7 - Various Topics
P. 6

Annuity = periodic payments


    • Who can pay an annuity?

    - RAF, PF, PrF, Employer, Insurance policy, a trust .


    - Where a person sells his business/part thereof and requires the buyer to

      settle the consideration in annuity payments.


                                               Characteristics of an annuity:

                     = fixed , annual amount (may be divided into pmt’s)

                     = payment must be reoccurring in nature

                     = must be a compulsory payment




    Remember: s 10(2)(b) prohibits the exemption of local dividends

    (s 10(1)(k)) paid in the form of an annuity!




    • Section 10A: Purchased annuities?
    • = lump sum from PF/RAF/PrF is used to purchase annuity from an


       insurer.

    → Capital portion of annuity is exempt (capital portion will be provided!)


    • Section 10C: Exemption for non-deductible annuity ?


    • = from 1 March 2014, iro non-deductible s 11(k) and s 11(n) contributions.
   1   2   3   4   5   6   7   8   9   10   11