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CGT / Interest exemption from SARS vs TFSA
(01-16-2018, 12:22 PM)SaurusDNA Wrote: For that matter, this is also a serious flaw on your logic in the original post:

If you took the interest from the tax free investment and reinvested it in the normal savings account , you're going to make R7,200 no matter what because the exempted amount is capped, no matter what the source is of the money.

If you left it in the TFIA, it would have scored tax on all it's growth forever.

You are going to make an exact amount R7,200 if you put in new cash into a normal investment account as well, because its the cap for capital gains exemption, so there is no second saving on re-investing the tax free money. The only thing that happens if you withdraw the TFIA interest and reinvest it for the capital gains benefit, is that you lose ALL the tax free benefit of the growth of that interest, because you would have made R7,200 anyway.

Where did I ever say I would take money out of the TFSA/TFIA to fund the others? It was quite the opposite and the others need to fun the TFSA/TFIA because you cannot take money out of it (or rather you shouldn't) due to the negatives.

But your last paragraph is more in line with what I'm getting at and that is that you should be using these things in parallel if anything, while most people bark up the tree of TFSA first uber alles which doesn't make sense as a one-size-fits-all solution as nobody has only longterm goals.

And as such if you don't have the money to "over fund" the TFSA then one has to ask why you are putting it in the TFSA in the first place if you don't have a tax implication to begin with due to lower investment volumes.

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