What is a tax certificate?

Question:

Question 1: what is a tax certificate? 2: can I claim the income tax contributions as stated on my income tax certificate? 3: can I borrow money against my retirement policy, if yes,can I borrow up to R120 000?

Answer:

Eliot,

A tax certificate is a certificate issued by your retirement fund administrator that confirms the contributions you made to the fund during the tax year. They are typically only relevant for retirement annuity funds. You may also get a tax certificate proving that your retirement fund proceeds form one fund were received by another fund (ie you did not cash out).

The amount of contributions you can claim will depend on your particular circumstances and the level of income you earn. You should include all the contributions made in your tax return, and SARS will calculate how much you can claim. They will also carry forward any contributions, and set this off against future income, if permitted. Refer to our Retirement Annuity FAQs for specific answers to the tax treatment of retirement annuity contributions.

You cannot borrow against your retirement annuity policy.