T-DAY MEANS YOU CAN SAVE MORE!
From T-Day (1 March 2016), tax law changes mean that you are now able to make tax-deductible retirement fund contributions of up to 27.5% of the greater of your remuneration and taxable income (subject to some constraints). This means you can save more for your retirement, and get a bigger tax deduction. By contributing more, you can work towards a more secure retirement. You can read all about the T-Day enhancements to your remunerations options in the T-Day Booklet.
You will have an opportunity prior to the July and November payroll run each year to make a change to your contribution rate. You can find details about your new contribution options here.
OFFICE STAFF: ROUNDING OF YOUR CONTRIBUTION RATE FROM JULY 2016
When the remuneration structure was updated in March 2016, your combined contribution towards risk and retirement funding in OMEGS was converted to a percentage of your TGP. The calculation was done for all Office Staff (TGP employees), so that the Rand amount of your contributions remained exactly the same. Your TGP was also unchanged.
In some cases, the conversion calculation resulted in your combined contribution rate having up to two decimal places – for example, 13.13%, 15.41% or 17.55%. To simplify matters, in July 2016, your combined contribution rate will be rounded to the nearest 0.5%, unless you make a different selection on Oracle package structuring as explained above.
For example:
- 13.13% will be rounded down to 13.0% (made up of an Employee contribution of 9.5% and an Employer contribution of 3.5%)
- 15.41% will be rounded up to 15.5% (made up of an Employee contribution of 12.0% and an Employer contribution of 3.5%)
- 17.55% will be rounded down to 17.5% (made up of an Employee contribution of 14.0% and an Employer contribution of 3.5%)
- 19.0% would stay unchanged (made up of an Employee contribution of 15.5.0% and an Employer contribution of 3.5%)
This rounding exercise means that your contribution to OMEGS may change slightly from July 2016. You do not need to do anything, unless you want to change your contribution rate. If you make a change to your contribution rate, this will take precedence over the rounding exercise.
