Following the introduction of tax-free savings accounts on March 1, product providers have started their marketing efforts and a wide variety of options are now available.
Tax-free savings accounts offer South Africans the opportunity to invest up to R30 000 per annum (R500 000 over a lifetime) and investors won’t pay any tax on the returns (capital gains, dividends and interest) in these accounts.
But as investors start to ponder the pros and cons of using tax-free savings accounts in their personal investment portfolios, a number of important questions have been raised.
Section 240A of the Tax Administration Act, 2011 (as amended) requires that all tax practitioners register with a recognized controlling body before 1 July 2013. It is a criminal offense to not register with both a recognized controlling body and SARS.