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Retirement annuity tax saving
Contributions to pension, provident and retirement annuity funds are deductible up to 27.5% of your income, capped each year. This shows your limit and what an extra contribution gives back.
Tax saved by the extraR8,640 a yearR720 a month · the extra costs you R1,280 a month after tax
- Your yearly limitR165,000
- Contributions nowR36,000
- With the extraR60,000
- Room left after the extraR105,000
How it works, with your numbers
- Limit: 27.5% of R600,000 = R165,000, capped at R430,000: R165,000.
- Tax with R36,000 deducted: R119,947. With R60,000 deducted: R111,307.
- Saving: R119,947 − R111,307 = R8,640.
Good to know
- Private RA payments aren't in your PAYE, so the saving comes back as a refund when you file.
- Pay in before mid-February to count for this tax year.
Uses SARS rates for the 2027 tax year. For illustration only. This is a guideline to help you plan, not tax advice: a registered tax practitioner must review and approve the final figures before you file.