Members to see boost in accounts

MEMBERS of National Superannuation Fund (Nasfund) in the country will see an increase in their savings account after the fund increased interest on crediting rate to nine per cent.
It followed a decision by the Nasfund board last week.
More than K584 million was allocated to more than 680,000 members’ accounts last weekend.
CEO Rajeev Sharma told The National that crediting had been completed.
“Members will be able to check their balances on the Nasfund app, employee portal and using text balance,” he said.
“The nine per cent result this year comes from the overall gross return of 11.2 per cent,” he explained.
“Out of this, expenses and tax account for 2 per cent, while 4.08 per cent came from international equity.
“BSP dividend and growth also contributed two per cent equity, and five per cent came from interest on state securities and property.”
However, this interest credit will be subjected to tax when a member exits the fund,
“Annual crediting is applied from post-tax salary,” Sharma said.
“Superannuation companies pay tax at 25 per cent on their profits. Exit tax depends on how long one has been a contributing member. For those who contributed 15 years pay only two per cent.
“Member’s funds are taxed on exit only on employer contributions and interest earned.
“The rate of tax could be as low as two per cent and as high as marginal tax, depending on how long a member contributed to the fund.
“No tax is applicable on member’s contribution as it is paid from post-tax salary,” Sharma said.