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NTCP 479.80 cents - LDT: 31 Oct 2023
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Shares / Re: RA versus continued offshore investment / is the tax break really worth it?
« on: October 20, 2023, 03:50:11 pm »
I don't have an RA purely because I think that the tax savings now won't be enough to overcome the lower performance and potentially higher costs of the RA.
Then of course there's the problem that a) you will have to pay income tax on the withdrawals one day, and b) your money is locked until you're at least 55, and you end up with a fairly mediocre product.
A TFSA on the other hand is something I think every single South African should have and should max out all the time, but until they allow 100% offshore RAs I'll keep avoiding them.
I do suspect someone in the top tax bracket who expects to retire in a much lower tax bracket can get some decent value about the tax savings, but my maths said I wasn't one of those.
Then of course there's the problem that a) you will have to pay income tax on the withdrawals one day, and b) your money is locked until you're at least 55, and you end up with a fairly mediocre product.
A TFSA on the other hand is something I think every single South African should have and should max out all the time, but until they allow 100% offshore RAs I'll keep avoiding them.
I do suspect someone in the top tax bracket who expects to retire in a much lower tax bracket can get some decent value about the tax savings, but my maths said I wasn't one of those.