Talking tax before 29 February

You are probably witnessing a plethora of advertisements in the written media and on radio relating to investment in a retirement annuity before 29 February 2008. The consciousness raised by these advertisements is good as there are distinct tax advantages to such an investment.

Act before 29 February – Save Tax

You have two weeks and a few days till 29 February to get your tax deduction by investing a lump sum into a Retirement Annuity.

However, there are a few things to consider before you act:

• Most retirement products and insurance agents promise you the world without having your best interests at heart.
• Lack of transparency and high costs have given certain products a bad reputation, and rightly so.

How do you ensure that you are getting the right product and the right advice for a retirement annuity investment?

1. Avoid life assurance–based Retirement Annuities. Such plans carry high costs and a further layering of costs.
2. Avoid Retirement Annuities that require a commitment of paying contributions until a fixed age and which carry penalties should you reduce or stop paying your contributions for any length of time.

The Solution

The solution is to use a unit trust-based Retirement Annuity. These Retirement Annuities are fully transparent with no hidden costs or penalties should you decide to stop or reduce your contributions.

What’s more, a unit trust-based Retirement Annuity offers a wide choice of portfolios from an ultra-safe Money Market portfolio to moderate and higher risk portfolios.

Another plus is that you are able to invest in a Retirement Annuity and deduct the contribution from your taxable income till the age of 69.

Invest a lump sum into a Retirement Annuity before 29 February for a tax deduction in the 2008 tax year. Silke Financial Services has the skill and expertise to advise you properly in terms of tax law, product knowledge and risk appropriateness to suit your investment time horizon.

NEWSFLASH – Take Tax Advantage Now (PDF Download)

If you have any queries regarding the above commentary please contact us on 021 683 3380 or info@silke.co.za.