RA contributions - tax benefits?

By Marc Sevitz · Updated

I have a sole prop who earns R3m per annum. To reduce his PAYE I have suggested he takes out an RA.
What is the maximum he can contribute for Feb 2014 so as to maximise his tax position.
TaxTim Marc

TaxTim Marc said:
10 February 2014 at 21:35

For retirement annuity fund contributions the limit is 15% of gross non-retirement-funding-employment income which essentially is all the income earned which is not allocated to a pension fund or provident fund. For a sole prop it will be all the income he has earned. You can take out an RA for February for the full amount in one contribution.