The newly appointed GM and Director of Warwick Wealth, Connor Kilbride, introduces himself with an important message.
Optimising your retirement annuity tax benefits
I am deeply honoured to have been appointed General Manager of Warwick Wealth. It is a privilege to lead the business nationally at such an exciting stage of our journey. I would like to sincerely thank the group for the trust placed in me, and in particular Marc Wiese for his leadership and guidance as CEO of Orion Wealth Managers. His vision continues to provide the foundation from which Warwick Wealth can grow and innovate with confidence.
As we are heading towards the end of the tax year, may I take this opportunity to remind ourselves of the role, importance and benefits of tax-free investments.
Key benefits of retirement annuity (RA):
- Tax savings: Contributions are tax-deductible up to 27.5% of your taxable income (capped at R350,000 annually).
- Tax-free growth: No tax on interest, dividends, or capital gains while in the RA.
- Estate planning: RAs are usually excluded from your estate, avoiding estate duty and executor fees.
- Creditor protection: Your RA is secure from creditors.
- Investment flexibility: Choose from various Regulation 28 investment options tailored to you such as unit trust single funds, wrap funds and share portfolio solutions.
As a practical example, this is how it could benefit you:
- Assuming a taxable income of R1 200 000 per year and under 65 years of age
- You invest the maximum RA contribution of R330 000 (27.5%)
- This reduces your taxable income to R870 000
- Your previous pay as you earn (PAYE) tax would have been R374 284
- Your PAYE tax has now been reduced to R238 984
- That’s a saving of R135 300 in tax!
- You could reduce your annual tax payable by up to R135 300, depending on your marginal tax rate.
Note: Employer/employee contributions to a pension or provident fund must be included in the R350,000 annual tax-deductible contribution limit.
To maximise this benefit, ensure any lump-sum contributions are made by no later than mid-February to allow for processing before the February 28 deadline.
Should you have any questions or need assistance, please do not hesitate to contact your Warwick Wealth Specialist or Advisor.
Wishing you a successful and prosperous 2026.
Connor Kilbride
GM and Director, Warwick Wealth
Disclaimer: The information, opinions and recommendations contained herein are and must be construed solely as statements of opinion and not statements of fact. No warranty, expressed or implied, as to the accuracy, timeliness, completeness, merchantability or fitness for any particular purpose of any such recommendation or information is given or made by Warwick Wealth (Pty) Ltd in any form or manner whatsoever. Each recommendation or opinion must be weighed solely as one factor in any investment or other decision made by or on behalf of any user of the information contained herein and such user must accordingly make its own study and evaluation of each strategy/security that it may consider purchasing, holding or selling and should approach its own financial advisers to assist the user in reaching any decision. This document is for information only and do not constitute advice or a solicitation for funds. Investors should note that the value of an investment is dependent on numerous factors which may include, but not limited to, share price fluctuations, interest and exchange rates and other economic factors. Performance is further affected by uncertainties such as changes in government policy, taxation and other legal or regulatory developments. Past performance provides no guarantee of future performance.
Warwick Wealth (Pty) Ltd (Registration number 2012/223370/07). An authorised financial services provider (FSP 44731)