Tax Implications of Withdrawing from Two-Pot Retirement System.
Starting from 1 September 2024, individuals planning to withdraw from the savings pot of the Two-Pot Retirement System must be registered for tax. Unregistered individuals must complete their registration before applying to their relevant fund, as unregistered requests will be rejected by SARS.

Key Points:
- Tax Registration: Contributions to retirement funds are not taxed, but withdrawals will be taxed at the individual’s applicable rate. Taxpayers must ensure they have no outstanding returns or debts to SARS, as these will be deducted from the withdrawal amount
- Application Process: Taxpayers can register for tax using SARS’s digital channels, including eFiling, the SARS MobiApp, and the SARS Online Query System. Once registered, the pension fund will apply for a tax directive from SARS, which will be issued within 48 hours if the taxpayer is compliant
- Debt Deductions: Any outstanding debt to SARS will be deducted from the withdrawal amount. If there is a debt arrangement with SARS, the withdrawal will not be affected
- Tax Calculator: A tax calculator is available on eFiling and the SARS website to help pension fund members estimate their payout
The Mandatory Compliance Checklist.

- Section 4: Solvency and Liquidity
- Section 15: Memorandum of Incorporation (MOI), shareholder agreements and rules
- Section 26: Access to company records
- Section 27: Financial year of company
- Section 28: Accounting records
- Section 29: Financial Statements
- Section 30: Annual Financial Statements
- Section 32: Use of company name and registration number
- Section 33: Annual Return
- Section 44: Financial assistance for subscription of securities
- Section 45: Loans or other financial assistance to directors
- Section 50: Securities Register and numbering
- Section 61: Shareholders meeting
- Section 66: Board, directors and prescribed officers
- Section 69: Ineligibility and disqualification of directors/prescribed officers
- Section 70: Vacancies on board
- Section 72: Board committees
- Section 86: Mandatory appointment of company secretary
- Section 90: Appointment of auditor
- Section 92: Rotation of auditor
- Section 94: Audit committees
- Regulation 21: Registered office of the company
- Regulation 43: Social and Ethics Committee
- Schedule 1: Provisions concerning Non-Profit companies
- Section 215(2)(e): a person commits an offence who knowingly provides false information to the Commission
- Section 216(b): any person convicted of an offence is liable to a fine or to imprisonment for a period not exceeding 12 months, or to both a fine and imprisonment
CIPC is tasked with ensuring, monitoring and enforcing compliance with the Act. It is also responsible for, inter alia, the disclosure of information on its business registers. Companies are responsible for submitting information together with their CIPC annual returns with the aim of increased transparency and disclosure – including beneficial ownership registers, compliance checklists (where applicable) as well as their financial information [whether in the form of a financial accountability supplement or their annual financial statements in XBRL format (where applicable)]. Although no penalties are specifically prescribed for non- compliance with these transparency provisions, a contravention of the Act may result in the issue of a compliance notice by CIPC. Failure to comply with the compliance notice may result in a court-ordered administrative fine or a referral of the matter to the National Prosecuting Authority for prosecution as an offence.
2024 Tax Filing Season Updates.

Key Changes for 2024:
- Solar Energy Tax Credit: A one-year incentive for new and unused solar PV panels, allowing a deduction of 25% of the cost, up to R15,000
- Retirement Contribution Deduction: Adjusted for assessment periods shorter than 12 months, applied pro rata
- Renewable Energy Tax Incentive: Businesses can deduct 125% of the cost of eligible assets used in electricity generation, with no limits on electricity generation
Important Deadlines:
- Individual Taxpayers: October 21, 2024
- Provisional Taxpayers: January 31, 2025
Taxpayers are reminded to ensure their banking details are up to date for refunds and to be vigilant against phishing scams during the filing season.
Should you require professional advice in this regard do not hesitate to contact our offices.
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