All you need to know about Gross Retirement Funding Income

Struggling to understand the concept Gross Retirement Funding Income? Unsure about how and why it affects your payroll? Need some help with the setup on Pastel Payroll?

Here is a two-page guide we compiled to assist you with understanding the concept as well as applying the correct setup on Pastel Payroll. Although there are various methods of setting up RFI and NRFI in Pastel Payroll, I explained the quickest, easiest method in this guide.

FAQ Pastel Partner Payroll 2013 Update 1 – RFI vs NRFI

18 Comments

Filed under Legislative Updates, Partner Payroll, Product Information, Support

18 responses to “All you need to know about Gross Retirement Funding Income

  1. clare

    This document , does not assist us on how to delcare the group risk cover , as a fringe benefit – which is has to be done for the March 2012 payroll
    and No calls are being answered at the pastel payroll call centre.

    • Maritsa

      Dear Clare
      You can use transaction code 6140 – Payment of Debt to process the un-approved group risk cover. To change the name go to setup…Transactions and select 6140 and change the name to un-approved group risk cover.

  2. Jetro

    I’ve been a temporarily teacher from 2008 – 2011! On my salary advise,bottom left it is written that Gross retirement income: R56 000! Is this the money I can claim? I’ve been paying by Department of Education,please respond it’s urgent

    • Madelein van der Watt

      Hi Jetro

      The amount indicated as Gross Retirement Income on your salary slip/IRP5 tax certificate is the portion of your annual salary used in the calculation of pension/provident fund contributions made by yourself, your employer or both. SARS will use this amount to determine how much of the pension or retirement annuity fund contributions you paid, can be claimed on assessment. If you contributed towards a pension fund yourself, these contributions can be claimed but will be limited to 7.5% of R56 000. If you contributed towards a retirement annuity, SARS will only allow 15% of your annual salary that exceeds R56 000, as a tax deduction.

      You cannot claim the full R56 000 but your pension/retirement annuity contributions can be claimed limited to the amounts explained above.

      Regards

      Madelein

  3. M.N Motau

    Want to know about Rfi &Nrfi

    • Madelein van der Watt

      Hi M.N Motau

      RFI or retirement funding income is the total taxable remuneration used in the calculation of pension or provident fund contributions and is also used when applying statutory limits for tax deductions. The total remuneration not used in calculating pension or provident fund contributions is the NRFI or non retirement funding income. NRFI is also used to calculate statutory limits for RA tax deductions.

      Regards

      Madelein

  4. siyasanga

    Need to know about gross retirement funding income

    • Madelein van der Watt

      Hi Siyasanga

      Retirement funding income is the total taxable remuneration used in the calculation of pension or provident fund contributions and is also used when applying statutory limits for tax deductions.

      Regards

      Madelein

  5. sifiso

    There is an amount Of R15000 on my 3698 code does this mean I can claim the money

    • Madelein van der Watt

      Hi Sifiso

      Code 3698 on an employee tax certificate represents the value of non retirement funding income – the value of your taxable earnings that was not used to calculate a pension or provident fund contribution. If you have a value for code 3698, it means that you may claim a portion of any retirement annuity contributions you have paid as a tax deduction.

      Regards

      Madelein

  6. Charlene Kyd

    If the values on codes 3697 and 3698 are not correctly distinguished on my irp5 impact on tax rebate or not. Does it make a significant difference. If so if the company did not enter these details correctly what do I do?

  7. roney mothibe

    Helo can you please help me. My code is 3698 and how do I claim it please help me

  8. jermaine korie

    Good day I want to knw more about the gross non-retirement funding income! When it can be claimed? Thanx

  9. Thomo Jim Mashanya

    Hi on employee tax certificate code 3697 is it the money to be claimed? Please advice.thanks.

    • Madelein Taljaard (van der Watt)

      Hi

      The code 3697 on a tax certificate is the total of all your taxable income that was used to calculate a pension or provident fund contribution. It is called Retirement Funding Income. It is not money that you can claim but it is the value that will be used when SARS calculates how much of your pension fund contributions can be tax deductible.

      An example is that if you pay 10% of your salary to a pension fund and you earn a salary and commission, the salary amount will show in code 3697 since it was used to calculate your pension fund contribution. The commmission will show in code 3698, Non Retirement Funding Income, because it was not used to calculate your pension fund contribution.

      When SARS calculates how much of the 10% pension fund contributions you paid will be allowed as tax deduction, they will then use the salary amount in code 3697 to calculate the maximum amount of 7,5%.

      Regards

      Madelein

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