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GTC Press Release

Approved or unapproved death benefits – beware of hidden tax implications for loved ones

Knowing whether your death benefits are approved or unapproved in terms of the Pension Funds Act may save your loved ones from any unexpected tax surprises at an already difficult time. “The nature of death benefits rarely gets enough attention from ‘the living’ but the tax implications of this benefit can become a substantial burden on the beneficiaries you intend providing for,” says Celeste Kruger, Consultant – Employee Benefits Consulting, GTC. Death benefits from retirement funds are subject to the requirements of Section 37C of the Pension Funds Act, and they are taxed in terms of the Second Schedule of the Income Tax Act (see scales at the end of the article). “Most employers provide for a death benefit – usually a lump sum amount – to employees in addition to a retirement benefit. But the way in which this...
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Be careful when considering cutting short-term insurance cover, especially in a tough economy – GTC Risk Solutions

In tough economic climates – such as the recession South Africa finds itself in at the moment – households and small business owners may be tempted to reduce their short-term insurance, but the short-term savings may not justify the long-term cost of recovery in the event of a natural disaster. Roy Wright, Head – Risk Solutions at leading financial advisory and wealth management business GTC, says consumers need to ensure they know exactly what their insurance policies provide cover for, especially considering the possible effects of floods or fire. The recent storms in Cape Town and the devastating fires along the Garden Route, particularly in Knysna, are tragic reminders of the ongoing need for inclusive cover. “Most modern insurance policies offer comprehensive cover, which protect against many eventualities, from theft or damage to natural disasters, such as floods and fire....
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Is a medical aid from a larger scheme always better? GTC Medical Aid Survey 2017 results reveal small medical aids also offer good value.

Findings for 2017 also highlight consumers may be unaware of their own medical aid plans and the benefits therein. Smaller medical schemes perform well by offering consumers value for money, but they have not been as successful as some of the larger schemes in attracting new members, and thereby ensuring continued value and ‘health’ for the scheme over the long term. This is one of the significant conclusions from leading wealth and financial advisory firm GTC in its seventh annual Medical Aid Survey for 2017, according to Jill Larkan, the firm’s Head: Healthcare Consulting. The Medical Aid Survey analyses and rates medical aid schemes and it further provides a standardised comparison and ranking of the choices available to consumers. “This survey cuts through the notoriously complicated landscape of the medical aid industry and simplifies it according to the factors that...
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Cyber-crime requires specialised protection against unique risks

The majority of businesses in South Africa are aware of the risks of cyber-crime, but very few of them have adequate – if any – cover to protect their organisations in the event of a cyber-attack. “A report by AT Kearney, Global Management Consulting Firm, has revealed that South Africa is the third most vulnerable country in the world for cyber-attacks, and the most vulnerable in Africa,” says Roy Wright, Head: Risk Solutions at leading financial advisory and wealth management business GTC.  “Cyber security is a real business risk that can affect a company of any size anywhere in the world, but too few local companies are taking steps to insure their organisations against this risk.” Grant Thornton’s recent International Business Report on cyber security reveals that 88% of businesses in South Africa have identified exactly where all their data...
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Specialist protection is essential to guard against cyber crime

South Africa ranks as one of the most vulnerable countries in the world for cyber attacks, yet local businesses are largely discounting this risk and not protecting themselves adequately in this regard. Roy Wright, Head: Risk Solutions at leading financial advisory group GTC believes small, medium and micro enterprises (SMEs) are especially exposed to the dangers of cyber crime. “While unseen, crime in cyberspace presents one of the biggest threats to businesses today,” says Wright.  “A report by AT Kearney, Global Management Consulting Firm, has revealed that South Africa is the third most vulnerable country in the world for cyber attacks, and the most vulnerable in Africa.” According to a recent Global Economic Crime Survey by PWC, cyber crime is also now the fourth most reported economic crime. Wright says that many smaller business executives believe that only large corporations...
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Worldwide Capital merges with GTC, enhancing asset management capability

GTC proudly announces the merging of Worldwide Capital (WWC), an asset management business with core capabilities in the areas of smart beta tracking, indexation and the portfolio construction of bespoke investment products, with GTC. The merger, effective April 2017 sees WWC fully integrated into the asset management capability of GTC. GTC also gains a turnkey Protected Cell Company structure in Mauritius through the transaction. “We’re delighted to have Worldwide Capital join our organisation,” says Gary Mockler, GTC’s Group CEO.  “We look forward to offering our clients the additional capability of  low-cost algorithmic – or passive – investing, which can be constructed on a tailored basis”. GTC, formerly Grant Thornton Capital, currently provides a wide range of financial advisory, wealth management and employee benefits administration services to more than 2500 private clients; and some 85 000 retirement fund members, managed through a...
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High costs affecting retirement funds? Communication is the key to alleviating litigation

One of the more interesting trends that has recently emerged from the American retirement space is the practice of employees taking their employers to court over high costs associated with their pension funds. Toy Otto, Head – Employee Benefits Consulting at leading financial advisory group GTC, believes this trend might well find its way to South Africa in due course. “This may have serious consequences for the savings and retirement industry as we know it, if we do not adjust the way we report information back to our members.” Otto believes this is a natural consequence of employees becoming more empowered about their retirement options and rights, and the changes in regulation over the past ten years (as well as draft regulations to be introduced in the near future) which will encourage greater interest in costs and benefits relative to...
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Expected rise in personal income tax rate is attractive incentive for boosting retirement savings

An increase in personal income tax rates and the marginal rate of tax for high income earners – which will more than likely be announced in this week’s National Budget Speech – will be a bitter pill to swallow in the short term. However, if this does happen, it will provide a good opportunity to boost long-term retirement savings. This is the opinion of Jill Larkan, Corporate Liaison Executive at leading financial advisory and wealth management business GTC. “Given the country’s growing revenue shortfall and the National Treasury’s limited options for raising income, commentators are expecting that personal income tax rates and the marginal rate of tax will be raised, with high earners likely to be affected the most.” While higher taxes rates might be undesirable, she believes it may bring a silver lining for individuals’ retirement benefits. “An increase...
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Revised retirement regulations should provide improved outcomes for retirees

The National Treasury has moved closer to its goal of ensuring that South Africans can retire more comfortably following the release of its revised default regulations for the pension industry. This is the opinion of Jill Larkan, Corporate Liaison Executive at financial advisory business GTC. “These revised regulations follow extensive consultation with the retirement industry after the first draft of default regulations from National Treasury were published in 2015,” says Larkan. “The Treasury has clearly taken the concerns and input from the industry on board and the latest revisions are generally much less restrictive on the providers of retirement benefits, while still protecting fund members.” The aim of the regulations is to lower charges and improve market conduct in the retirement fund industry, to ultimately enhance retirement values by limiting costs and allowing more South Africans to retire comfortably. “The...
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