Reducing Personal Income Tax

[grim]

What LEGAL ways are there to reduce your personal income tax?

Rather tired of SARS helping themselves to nearly a third of my salary every month

 

[pension]

just earn less money

 

[RanzB]

just earn less money

 

[ElementZero]

just earn less money

what he said

 

[KleinBoontjie]

At what stage do they start giving back?

 

[JStrike]

What LEGAL ways are there to reduce your personal income tax?

Rather tired of SARS helping themselves to nearly a third of my salary every month

The tax on Capital Income is very low. I found that increasing my ratio of Capital Income vs Revenue Income has done wonders for my tax bill

 

[rrh]

At what stage do they start giving back?

Never

 

[Mbuzi]

I really don't understand why can't we just pay a fixed rate of tax, all of us. 20% everyone regardless of your salary. Right now I feel the rates are discriminatory in a sense that a guy who spends 5 more years studying will pay more than a guy who just has a Nkandla High School Grade 3.

Replying to the OP, just quit working or simple earn less as some of the forumites have advised

 

[Went_For_Beer]

Whats the chances.... I WANT MOOOOOORE

 

[Wburn]

I suggest you go and see a registered tax practisioner ie. accountant or bookkeeper hat can help you with deductions. There is often a lot of things you can deduct from your salary to make your tax burden less.

 

[KleinBoontjie]

The tax on Capital Income is very low. I found that increasing my ratio of Capital Income vs Revenue Income has done wonders for my tax bill

How do you do that?

 

[JStrike]

How do you do that?

As one normally would. Deploy Capital that then earns Capital Income. And start ensuring that the Capital Income grows faster than than Revenue Income. Your tax liability will start decreasing

 

[qwertyqwer]

As one normally would. Deploy Capital that then earns Capital Income. And start ensuring that the Capital Income grows faster than than Revenue Income. Your tax liability will start decreasing

easy peasy lemon squeezy

 

[noob_saibot]

I really don't understand why can't we just pay a fixed rate of tax, all of us. 20% everyone regardless of your salary. Right now I feel the rates are discriminatory in a sense that a guy who spends 5 more years studying will pay more than a guy who just has a Nkandla High School Grade 3.

Replying to the OP, just quit working or simple earn less as some of the forumites have advised

When paying marginal rates, this is referred to as progressive taxation.

If you want to see a flat tax in SA, look at our VAT.

The problem with flat tax rates is that they hurt the folks on the lower income brackets. 20% of a 10K income will hurt the pocket more than 20% on 20K (this is what is mentioned in justifying progressive taxation)

Also, AFAIK, income tax makes up around 30% of gov revenue, so they won't be adjusting the tax system any time within the next 100 years (unless it is to increase it).

 

[Tman*]

Contribute the maximum possible to an RA
Ditto for a Pension.
If you are receiving a 2nd income, for example from rental income contribute some of that income towards a pension too. (will fall under the NRFI rule)
Consider donating a portion of your salary to your spouse each year (up to a R100 000 pa will fall under donations tax IIRC)

 

[kdub]

The tax on Capital Income is very low. I found that increasing my ratio of Capital Income vs Revenue Income has done wonders for my tax bill

what utter *** spew thee?

 

[sjm]

Consider donating a portion of your salary to your spouse each year (up to a R100 000 pa will fall under donations tax IIRC)

Isn't this an after tax donation? I don't think you can deduct the donation from your annual revenue

 

[JStrike]

what utter *** spew thee?

What about it? Tax on Capital Income is very low tax

 

[borga]

Isn't this an after tax donation? I don't think you can deduct the donation from your annual revenue

You don't get to deduct it, but I think the idea is that your spouse will then get the capital gains, which might be tax at their rate which could be lower than your.

That won't work due to section 7 (2) a as the gains would still be seem as yours.

 

[goga]

what utter *** spew thee?

Ditto to this.
"Capital Income" nonsense.