Question:
hi. I have taken a retirement annuity fund for my 2 kids (14 & 8 years). how do I claim for tax benefit.
Answer:
Pam, The tax benefit can only be claimed by the stated owner of the retirement annuity, in this case your children. As they most likely do not earn any income, you will not be able to claim the contributions for tax. As children do not submit tax returns or have a tax number, SARS also will not have or keep a record of these contributions for deduction against future income. For this reason, retirement annuities are not really a suitable savings product for children, especially as they can only access this money from age 55 onward. It would have served you better to save this money for them in, say, a unit trust product and then transfer the money to a retirement annuity in their name only once they are income-earning adults (if it is in fact your plan to provide for their retirement).
