Simple Tax

[tRoN]

So - I inherited R10 million from my uncle and put that in the bank. I get R50,000.00pm interest on this (R600,000pa). Obviously the full interest is payable at year end - so I'd be liable for R120,000.00 marginal interest on this interest?

The obvious question is why the heck will you be working for 10k per month when u have an inheritance of 10 bars!!??

 

[Dolby]

Hypothetical numbers

 

[Celine]

no your salary is no longer 20%.

put all the income together and forget completely about the income from the salary and look at the income combined from the salary plus the interest and look at the tables and see what tax bracket you now fall into.

your salary WAS 20% until you started receiving the interest income. once you start receiving any other income that will put you into an entirely different tax bracket altogether and you can no longer look at each income individually.

 

[MickeyD]

no your salary is no longer 20%.

put all the income together and forget completely about the income from the salary and look at the income combined from the salary plus the interest and look at the tables and see what tax bracket you now fall into.

your salary WAS 20% until you started receiving the interest income. once you start receiving any other income that will put you into an entirely different tax bracket altogether and you can no longer look at each income individually.

True - but his employer (who is not aware of the inheritance) will only tax him on his salary.

 

[Celine]

he needs to forget about what the employer does or doesn't know. he knows what he is earning.