![]() [The tax e-filing season is upon us. If you need a tax consultant to help you with your e-filing, please contact Daberistic Accountants at 011-658-1333, email [email protected].] During a media briefing in Pretoria on Tuesday, new SARS Commissioner Edward Kieswetter told the South African public that the tax threshold for those who have to submit returns will be increased this season. Kieswetter’s announcement was initially delayed due to a massive power outage across the city. However, when the lights returned, the new tax chief dished out some encouraging news for those earning a low-to-mid range income. SARS tax threshold: Am I exempt from filing a tax return? Instead of requiring tax returns from everyone who earns R350 000 a year, that minimum figure has been increased to R500 000 a year. In monthly terms, the parameters have shifted from R29 166 to R41 666. However, it’s not all plain sailing for those of us making less than half-a-million per annum. The new threshold laws only apply to citizens if they meet the following set of criteria:
When is tax season in South Africa for 2019? Kieswetter was also keen to encourage more citizens to start using SARS’ e-filing systems. He revealed to tax-paying South Africans that the programme has gone through several updates, and more improvements will be in place by August. One of the incentives for using the e-filing systems is that they help with time management. Yes, tax season will start on 1 August and end on 31 October, but electronic applications start at the beginning of July and remain open all the way through until the last day of January 2020. It’s also worth noting that returns filed via SARS’ app have a deadline of 4 December 2019. Depending on what you’re earning and the new tax threshold, this could be a trouble-free season for many of SA’s workers. Source: thesouthafrican
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![]() In this article, we focus on Excess – the amount which you have to pay when you claim from your insurer (whether you are at fault or not) unless if you have elected to pay an additional premium for an excess-free policy. So, what exactly is an excess and why do insurers apply these charges to insurance claims? What is an excess? An excess is the uninsured portion of your loss or that portion of the claim you must pay for. When the amount that is claimed is less than the excess, no payment will be made by your insurer. Why do you pay an excess? Insurers use excesses as a way to make sure that you do not claim for every small loss. They do so not only for their own benefit but for all policyholders to ensure that insurance does not become unaffordable, because eliminating these claims and their associated costs helps keep premiums lower for you. An excess also acts as an incentive to ensure that you take responsibility for the safety and security of your possessions. Are there different types of excesses? There are many different types of excesses used by insurers. As a general rule of thumb – the lower the premium relative to the market standard the higher the excesses. Examples as follows:
The insurer needs to bring to your attention, when the contract of insurance is entered into, the standard excess and all other excesses that may be applicable when you claim. You can always enquire from your insurer if an excess can be completely done away with. This is referred to as an excess waiver. The important thing is that you understand why and when you pay an excess so that you can make an informed decision when taking out the insurance. Does an insurer have to recover the excess you paid? If someone else has caused your loss, the insurer may be able to recover the cost of the claim, including the excess you paid, from them or their insurer. The success of a full recovery however depends on several factors, including whether you identified the other party, whether they admitted fault, whether there are any witnesses, whether they have insurance and, if not, whether they have the ability to pay. What if your insurer does not recover the excess you paid? If the insurer decides that it is not going to attempt a recovery of the claim cost or it does not succeed in making a recovery, the insurer should advise you so that you can decide whether to attempt a recovery of your excess yourself. With the consent of the insurer, you may then proceed to recover your excess directly from the third party. We at Daberistic believe that by providing the right advice and solution to clients, we can create win-win relationships which will ultimately benefit everyone. If you are looking for advice on your short-term insurance needs, you can contact us on the following channels:
![]() Medical aid is a form of insurance where you pay a monthly amount, called contribution or premium, in return for financial cover for medical treatment you may need, as well as any related medical expenses. Medical aid and health insurance are two different products. Medical aid, or medical scheme, is regulated by the Medical Schemes Act, provides in-hospital cover and chronic illness benefits, and pays for treatment according to specific medical scheme tariffs. Some medical aids also provide for day-to-day medical expenses. Health insurance, on the other hand, is regulated by the Short-term Insurance Act. It provides a more limited set of health benefits, up to a monetary limit. Health insurance is a cheaper alternative for people who cannot afford medical aid. Why medical aid is important Having a good medical aid plan with a reputable medical scheme can help you protect both your health and your wallet. The reality is that your health, and that of your family holds immeasurable value to you. There are many advantages of belonging to a medical aid. It financially protects you if you suddenly have to pay large, unexpected medical costs. Being a member of a scheme also means you have access to private medical care, instead of having to rely on public health services. If you are looking for advice on healthcare needs for you, your family or your company, you can contact us on the following channels: - WeChat: daberistic - Email: [email protected] - Phone: working hours 011 658 1333 ![]() During 2017 the Minister of Finance issued the final retirement fund default regulations (commonly referred to as “Default Regulations”) made in terms of section 36 of the Pension Funds Act, 1956. These Default Regulations, published in Notice 863 of Government Gazette No. 41064, were the outcome of an extensive consultative process between Treasury and the FSCA (the first draft was published back in July 2015) and intend to improve the outcomes for members of retirement funds by ensuring that they get good value for their savings and retire comfortably. Default Regulations The final default regulations amended existing regulations published back in 1962 and, in essence, introduce three sets of requirements: 1. They require the board of trustees of retirement funds to offer a default investment portfolio to contributing members who do not exercise any choice regarding how their savings should be invested (Regulation 37); 2. They also require the fund to offer a default in-fund preservation arrangement to members who leave the services of the participating employer before retirement (Regulation 38); and 3. for retiring members, a fund must have an annuity strategy with annuity options, either in-fund or out-of-fund, and can only “default” retiring members into a particular annuity product after a member has made a choice. The above listed defaults must be relatively simple, cost-effective and transparent and require the board of trustees to assist members during the accumulationand retirement phases. 1. Default Regulations Regulation 37: Default investment portfolios All retirement funds with a defined contribution category are required to have a default investment portfolio(s). The investment portfolio(s) that members are defaulted into should be appropriate, reasonably priced, well communicated to members, and offer good value for money. Trustees are required to monitor investment portfolios regularly to ensure continued compliance with these principles and rules. Performance fees will be allowed but subject to a standard to be issued by the FSCA and a regulatory or policy review. Loyalty bonuses are not permitted. For now, Regulation 37 does not apply to retirement annuity and preservation funds. 2. Regulation 38: Default Preservation and Portability Funds that have members enrolled into them as a condition of employment (i.e. pension and provident funds), will have to change their rules to allow for default preservation, as some of them currently do not allow resigning workers to leave their accumulated retirement savings in the fund. The employee, however, will have the right and option to withdraw, upon request, the accumulated savings or to transfer them to any other fund, thereby achieving portability. Employees will also be required to first seek retirement benefits counselling before they make a decision. Regulation 38 does not apply to retirement annuity and preservation funds. 3. Regulation 39: Annuity Strategy The boards of all pension, pension preservation and retirement annuity funds must establish an “annuity strategy”. Provident funds and provident preservation funds must only establish an annuity strategy if the fund enables the member to elect an annuity. The regulations define an “annuity strategy” as follows: “annuity strategy” means a strategy, as determined by a board, setting out the manner in which a member’s retirement savings may be applied, with the member’s consent, to provide an annuity or annuities by the fund or to purchase an annuity on behalf of the member from an external provider, which annuity or annuities may either be in the name of the member or in the name of the fund and which complies with the requirements of regulation 39 and any conditions that may be prescribed from time to time”; (my emphasis) In determining the fund’s annuity strategy, the board must consider (as far as it can reasonably ascertain): · the level of income that will be payable to retiring members; · the investment, inflation and other risks inherent in the income received by retiring members; and · the level of income protection granted to beneficiaries in the event of death of a member enrolled into the proposed annuity. The proposed annuity or annuities – which can be a life annuity or a living annuity (and can be either member owned or in-fund) - must be appropriate and suitable for the specific class of members who will be enrolled into them, must be well communicated and offer good value for money. Members will be entitled to opt into this annuity strategy by selecting the annuity product in which they wish to enrol (i.e. the member must indicate which annuity product he/she would prefer by opting in instead of opting-out). Members should also be given access to retirement benefit counselling to assist them in understanding and giving effect to the annuity strategy. With respect to a living annuity, the fund must communicate to members (on a regular basis) the asset class composition of investments, their performance and changes in the income in respect of the annuity. In addition, funds will need to ensure that all fees charged in respect of the proposed annuity are reasonable and competitive considering the benefits provided to members. The fund must review its annuity strategy at least annually to ensure that the proposed annuity continues to comply with the regulations and is appropriate for members. The new concept of “retirement benefits counselling”: what does it entail? The concept of “retirement benefits counselling” is defined in the regulations as “the disclosure and explanation, in a clear and understandable language, including risks, costs and charges…”. Regulation 39 states that members must be given access to retirement benefit counselling not less than three months prior to their normal retirement age as determined in the rules of the fund (and as may be prescribed). It however offers little guidance as to what exactly this service must entail. The FSCA subsequently published a guidance note providing more clarity on (inter alia) the concept of retirement benefit counselling. PFA Guidance Note No.8 of 2018 states that retirement benefit counselling may be provided either in person or in writing. In either event, the fund must retain a record thereof. The person providing counselling (as appointed by the fund) does not need to be a registered FSP or financial advisor in terms of FAIS, but the board must be satisfied that the person who provides the retirement benefit counselling is suitably qualified and experienced and able to properly manage any conflicts of interest. Retirement benefit counselling does not include advice, even on tax matters, and members should be expressly informed of this fact. If advice is also provided, then the person providing the advice must be a registered financial adviser or tax practitioner, as the case may be. It is recommended that retirement benefits counselling should be provided no longer than 6 months prior to a member’s retirement from the fund and the board should make every effort to ensure that the information provided is still relevant and appropriate at retirement age. When members are given access to retirement benefit counselling, a disclosure and explanation must be provided in clear and understandable language, including fees, risks, costs and charges of the available investment portfolios, the fund’s annuity strategy and any other options made available to members. As of 01 March 2019 all default arrangements in respect of a fund must be fully compliant. Funds must therefore ensure that their rules and investment policy statements are properly aligned to ensure compliance with the new default regulations. Source: Personal Finance, Lize de la Harpe a legal adviser at Glacier by Sanlam. ![]() Buying your first car? You may do a better job by learning from these common mistakes 1. Do your homework and drive that internet search hard Google the name and model of the car, the dealership and check if people have complained about the car or the service from the dealership on Hellopeter. 2. Think about the real reason you want to buy that particular car Assess your budget and consider whether you're living beyond your means and remember, your car insurance premium will increase based on the type of car you purchase. 3. Test drive the car, especially if it's not a brand new car You should test drive all cars, especially second-hand cars on a hill with the air-conditioner on and, over speed bumps to determine if there are problems with the suspension. 4. Blindly trusting the salesman when it comes to used cars Car salesman aren't exactly known for being forth-coming with information about second-hand cars, especially if the car had been in an accident. Get the car tested by a third-party inspection centre and specifically ask them to look for signs of major accident damage and, then request for the key to be sent to the dealership for an a report as well as the service book. 5. Not sourcing your own financing will cost you big time The interest rate will have a major impact on the costs of the car. If you don't shop around for a finance deal with the lowest interest rate, you're likely to end up with a deal that benefits the dealership and not you. Balloon payments? This deal allows you to buy a more expensive car for a lower installment, leaving you with a once-off repayment of an outstanding lump sum. 6. Getting locked in a contract padded with adds-on Keep an eye out for the various add-ons that dealerships tend to add to the contract. The bow that you get on the car, the champagne, flowers and the gift you get when you buy the car – they're all add-ons that you end up paying for. Other add-ons to look out for are, paint protection, extended warranty, sound systems, car alarms and valets. Source: 702/Wendy Knowler; http://www.702.co.za/articles/338794/6-common-mistakes-we-ve-all-made-when-buying-our-first-car ![]() With much expectations, Vitality HealthyDining is finally here! Discovery Vitality members have no more excuses for not eating healthy. With the new HealthyDining benefit, you can get up to 25% cash back on qualifying HealthyMeal choices and 50% cash back on Vitality kids’ healthy meals when ordering through Uber Eats from participating restaurants: Col’Cacchio, Doppio Zero, Nando’s and Ocean Basket. Here’s what you need to do to get up to 25% cash back 1. Activate HealthyDining to earn 10% cash back on Vitality healthy meals. 2. Increase your cash back to 15% by finding out your Vitality Age. 3. Boost your cash back to 25% by completing a Vitality Health Check. If you have children 12 years or younger on your Vitality policy, your will automatically earn 50% on all Vitality kids’ healthy meals. How you can activate HealthyDining: 1. Activate HealthyDining through the Discovery app or website and get a unique code. 2. Link Uber Eats to Discovery Vitality by adding your unique code to your Uber Eats app. 3. Dine in with Uber Eats – order HealthyDining stamped meals from selected partners using the Uber Eats app. Please contact Tammy in our Healthcare team if you have any queries, email [email protected], tel 011-658-1333. In the past few months, three new banks have launched with a leaner, cheaper business model that will change the face of SA banking — TymeBank, Bank Zero and Discovery Bank. They are here to challenge the Big Four - ABSA, FNB, Nedbank and Standard Bank. The fifth largest bank, Capitec, started in 2001. It now has 11.4 million clients, acquired Mercantile Bank, with over 200,000 new clients opening new bank accounts a month. It also continues to develop its financial technologies. At the same time, Standard Bank the largest bank in South Africa announced it woule be closing 91 branches, affecting 1,200 employees. Many face retrenchments, many will be re-trained to be deployed other departments of the bank. Standard Bank points out that its clients use more of its services online via mobile phones, while having less visits to branches. We witness the waves of technology tsunami hitting the banking industry. The three new banks have very similar focus: digital, with no physical branches. Will they succeed? Will they threaten the Big Four banks? Who are their backers? TymeBank is controlled by African Rainbow Capital (ARC), an investment company controlled by the eclectic Ubuntu-Botho group headed by Patrice Motsepe. As the Forbes rich list has it, Motsepe is one of the 1,000 wealthiest individuals in the world, with a fortune of $2.4bn. Before it was bought by Motsepe’s company, TymeBank was owned by the Commonwealth Bank of Australia (CBA), one of the world’s top 10 retail banks. As for Bank Zero, the most entrepreneurially based of the three, it shows how far the Reserve Bank has come that it got the green light. Bank Zero is run by a maverick group of former FNB executives, most of them with strong technology backgrounds, with a few family and friends as shareholders. The chair and figurehead is the former FNB boss Michael Jordaan, based in Stellenbosch. Somewhat ironically, Jordaan is Motsepe’s partner in the data-only telecom network Rain. The Bank Zero CEO, Yatin Narsai (former head of FNB retail), runs the business day-to-day from Bryanston. Discussing the rationale for the bank in an interview with the FM, Narsai says SA ranks among the five countries with the highest bank fees in the world. "This is intolerable in such an unequal society, but then the rest of the bottom five were similarly unequal countries in Latin America," he says. No-one can ignore the competitive threat of cheap banking. Narsai says he personally will save R2,000 a month from his personal and business accounts, when Bank Zero goes live and he can move accounts. "Low fees will become the new normal and I hope that penalty fees will disappear altogether," he says. Discovery Bank is part of the wider group run by CEO Adrian Gore, which began as a health-care company in 1993. Discovery boasts Remgro associate Rand Merchant Investments (RMI) as its anchor shareholder. Discovery Bank is launching a new business model, based on its Vitality principles. If a client can manage his personal finance and credit well, his money in the account will receive a higher interest rate, while he pays lower interest rate on his home loans. Discovery Bank is hoping to use this business model to incentivise clients to modify and improve their financial habits. The question, however, is what the existing big four banks — FNB, Standard Bank, Absa and Nedbank — will do to counter the threat. "The big banks ignored Capitec in the early 2000s, and lost considerable market share. I am sure they will not make the same mistake again." Below is a comparison of bank charges (Source: Business Insider) Source: Businesslive
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