Example result based on the prefilled values.
Projected RA Balance
R4 737 264,91
Annual Tax Saving
R21 600,00
Net Cost of Contribution
R38 400,00
Max SARS-Deductible Amount
R165 000,00
Deductible Contribution
R60 000,00
Continue your plan
Useful next calculations
When to use this calculator
- Before choosing between saving, investing, or increasing your monthly contribution.
- When you want to compare best-case, base-case, and cautious return assumptions.
- When you need a quick projection before making a longer-term portfolio decision.
- When you are deciding how many more years of contributions are needed to reach a specific target balance.
- When you want to see whether starting earlier versus contributing more each month produces a bigger outcome.
A realistic South Africa planning example
Use these sample inputs as a quick scenario test, then change one variable at a time to compare outcomes.
Annual Taxable Income (R)
R400,000
Annual RA Contribution (R)
R250 per month
Current Age
35
Target Retirement Age
35
After entering these figures, review projected ra balance, annual tax saving and net cost of contribution together rather than in isolation — each metric tells a different part of the story. Then rerun the tool with one input adjusted to see which variable has the biggest effect on all three outputs before you settle on a plan.
How to read your results
Projected RA Balance
Use this metric to compare scenarios side by side and understand how changes in the key inputs drive the final outcome. If the figure surprises you, isolate one variable at a time and rerun the calculation to identify which assumption is responsible.
Annual Tax Saving
Review this figure alongside gross income and the local tax rules that apply to you. It is a planning estimate, not a filing result or a recommendation to make a tax decision.
Net Cost of Contribution
Use this metric to compare scenarios side by side and understand how changes in the key inputs drive the final outcome. If the figure surprises you, isolate one variable at a time and rerun the calculation to identify which assumption is responsible.
Max SARS-Deductible Amount
Use this metric to compare scenarios side by side and understand how changes in the key inputs drive the final outcome. If the figure surprises you, isolate one variable at a time and rerun the calculation to identify which assumption is responsible.
Deductible Contribution
Use this metric to compare scenarios side by side and understand how changes in the key inputs drive the final outcome. If the figure surprises you, isolate one variable at a time and rerun the calculation to identify which assumption is responsible.
Method & assumptionsAuthoritative sources
A South African retirement annuity (RA) offers one of the most tax-efficient savings mechanisms available to individuals under SARS rules. The core benefit is that contributions are deductible from your taxable income — up to 27.5% of your greater of taxable income or remuneration, capped at R350,000 per year in the 2024/25 tax year. This means a taxpayer in the 41% marginal bracket contributing R60,000 annually to an RA effectively reduces their income tax bill by approximately R24,600, bringing the real net cost of the contribution down to around R35,400. The calculator models this marginal tax saving using the full seven-band SARS bracket structure, then projects how your fund could grow using compound annual growth across the number of years until your chosen retirement age. The growth projection assumes contributions are made at the start of each year and compounds annually — a conservative simplification suitable for planning purposes.
Beyond the annual tax deduction, the RA environment provides further tax efficiency during the accumulation phase: all investment returns inside the fund — whether interest, capital gains, or dividends — are exempt from tax while invested. This compounding of gross returns rather than after-tax returns can meaningfully increase your terminal balance over a 20- to 30-year accumulation period. However, it is important to plan for the tax that will apply when you eventually draw on your savings. The one-third lump sum at retirement is partially tax-free up to R550,000 (lifetime limit), and the compulsory annuity income drawn from the remaining two-thirds is taxed as ordinary income. Consulting a FSCA-registered financial adviser is strongly recommended to structure your RA contributions, fund selection, and retirement drawdown strategy in line with your full financial picture.
Common mistakes
- !Using an assumption that is not supported by a current local quote, bill, statement or official source.
- !Treating a generic estimate as a lender, provider, payroll or tax authority decision.
- !Mixing monthly and annual inputs without converting them consistently.
- !Forgetting location-specific taxes, fees, eligibility rules or payroll deductions where they apply.
- !Testing only one scenario instead of checking how a cautious assumption changes the result.
What to do next
- Run a second scenario with a cautious assumption so you can see the downside clearly.
- Compare the result with the related calculators below before making a decision.
- Check current local rules, eligibility and provider terms before applying or committing money.
- Keep a record of the assumptions so you can update the estimate when a quote, bill or pay figure changes.
- Use the result to prepare better questions for a lender, provider, adviser or employer rather than treating it as a final answer.
Frequently asked
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