As we approach the festive season, TV adverts and newspaper inserts are encouraging us to embark on the usual Christmas practice of “shop ‘til we drop” – or these days, shop until our index fingers get tired of tapping in details online.

We also start to brace ourselves for the subsequent financial shock, when the credit card bills land on our doormats and in our email inboxes in the New Year.

Here are tips

Set a budget for your Christmas spending

Not just presents, but the additional spending on food, drink and socialising.

Use savings wisely

Make sure you know how your extra spend is going to be financed and access the money from the account paying the least interest.

Cash in “Christmas Club” accounts and loyalty cards

You can also finance your spending by cashing in the balance held in a “Christmas Club” account – built up during the year to spread the burden of the Christmas spend.

Pay off credit cards quickly

If you use a credit card, try to ensure that you pay off the balance in full when the bill arrives in the New Year.


Check your overdraft details

If you’re funding your spend via an overdraft make sure it’s authorised and you know the interest rate and any other charges your bank applies to overdrafts.

Shop around and look for deals

When it comes to shopping, further good rules apply. Shop around and look for deals – many retailers are discounting their prices even as the festive season gets underway and there are good deals to be had.

Fashion retailers have had a difficult few months, as the warm autumn has hit spending on clothing designed for autumn and winter – many are discounting prices to get customers through the door.

Taxation Laws Amendment Bill, 2020

Want to withdraw retirement funds on emigration? You may have to wait three years.

In July the Taxation Laws Amendment Bill, 2020 was published and it was open for comments until the end of August. On 13 October the Draft Response Document on the Bill was published, and on 28 October the second draft was laid before Parliament when the interim Budget was delivered. Even though this is still draft legislation, it is likely that it will be promulgated in its current form.

The contentious proposals in the Draft Tax Bill relates to the ability of people emigrating from South Africa to access amounts in their pension preservation fund, provident preservation fund and retirement annuity fund (retirement funds) when they leave.

3-year rule

The proposal in the Draft Tax Bill is for the payment of lump sum benefits from retirement funds to be only permissible when a member of a retirement fund ceases to be a South African resident and such member has remained a non-tax resident for at least three consecutive years or longer (3-year rule). The 3-year rule will impact all persons who are members of retirement funds and who require immediate access to their retirement funds upon emigration.

The effect of the 3-year rule is that members of retirement funds who emigrate will have to wait for a period of at least three years before they may access their pre-retirement lump sum benefits. This will cause financial hardship for people, who may need these funds to start a new life in the destination country.

The impracticality of the proposed 3-year rule is that it does not consider the position of retirement fund members who financially emigrate shortly before it commences. Those who have started the financial emigration process but have not completed it by 1 March 2021 - the proposed commencement date of the 3-year rule - will also be prejudiced.

The 3-year rule makes retirement annuity funds more unattractive as retirement savings vehicles. The reason for this is that members of retirement annuity funds will have to wait three years to access to their retirement benefits, whereas members of pension preservation and provident preservation funds may access certain pre-retirement benefits once prior to retirement and members of pension and provident funds may make a pre-retirement lump-sum withdrawal upon termination of their employment relationships.

Contact one of our advisors for more information.

Phone: 011 803 9686

Email: or

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