SteriStumpi
Epic Member
I was reading through the SARS site and tax guide and saw the below for tax on interest income and exemptions. I was hoping there was someone on Carb who possibly knew what the answers to my questions were below. Apologies if they are basic but appreciate if anyone knew what they were.
"Interest exemptions
• Interest from a South African source, earned by any natural person under 65 years of age, up to R23 800 per annum, and persons 65 and older, up to R34 500 per annum, is exempt from income tax.
• Interest earned by non-residents, who are physically absent from South Africa for at least 182 days during the 12 month period, before the interest accrues and the interest bearing debt is not effectively connected to a fixed place of business in South Africa, is exempt from income tax."
Questions:
1) On the first point, If the interest income is over R23.8k I presume it gets added to your regular income tax rate? - hypothetically, If you don't have any other taxable income do you still get the R87,300 income tax threshold for those under 65? So the R23,8k and R87.3K per annum exemptions if the interest income is your only source of income?
2) I'm not entirely sure what the second point means, what type of interest is not connected to a fixed place of business? (just thinking hypothetically if I'm out of SA, what this would mean for say a fixed deposit I have at FNB/Standard Bank - I would think just the normal treatment of it as in point 1, but then I'm not sure about their second point what this means)
"Interest exemptions
• Interest from a South African source, earned by any natural person under 65 years of age, up to R23 800 per annum, and persons 65 and older, up to R34 500 per annum, is exempt from income tax.
• Interest earned by non-residents, who are physically absent from South Africa for at least 182 days during the 12 month period, before the interest accrues and the interest bearing debt is not effectively connected to a fixed place of business in South Africa, is exempt from income tax."
Questions:
1) On the first point, If the interest income is over R23.8k I presume it gets added to your regular income tax rate? - hypothetically, If you don't have any other taxable income do you still get the R87,300 income tax threshold for those under 65? So the R23,8k and R87.3K per annum exemptions if the interest income is your only source of income?
2) I'm not entirely sure what the second point means, what type of interest is not connected to a fixed place of business? (just thinking hypothetically if I'm out of SA, what this would mean for say a fixed deposit I have at FNB/Standard Bank - I would think just the normal treatment of it as in point 1, but then I'm not sure about their second point what this means)