Benefits in respect of resignation or dismissal

Since 1 March 2019, all members who end their service with their employer or who are dismissed from service will automatically become a paid-up member in the Fund. This means that your member share will remain invested in your chosen investment portfolio and will therefore continue to be adjusted with investment returns. Your insured benefits will however stop at the date that you become a paid-up member. This means that your death and disability benefits, funeral cover (excluding your voluntary extended funeral cover, if applicable) and voluntary critical illness benefits stop when you become a paid-up member.

The Fund’s administrator will provide you with a paid-up certificate within 2 calendar months of the Fund having become aware of your resignation from employment. Please keep the certificate in a safe place as you will be required to supply it to your new retirement fund within 4 months of joining the fund.
You will remain a paid-up member in the Fund until you complete and submit a withdrawal claim form instructing the Fund what you wish to do with your member share.
Please read the paid-up member Q&A to understand all the options you have as a paid-up member.
You have one of the following 4 options on resignation:
  1. Remain a paid-up member in the Fund thereby allowing your full member share to continue to be adjusted with investment returns. Remaining in the Fund as a paid-up member is cost-effective as you benefit from the low investment costs and small administration fee. No further contributions are made to the Fund. You may withdraw your benefit as a lump sum at any point before your retirement. Your insured benefits i.e. death cover, disability cover, funeral cover and Voluntary Critical Illness benefit stop on your becoming a paid-up member.
  1. Transfer your full member share to another approved fund – this can be a retail preservation fund, a retirement annuity fund or you may transfer your benefit to your new employer’s fund.
  2. Transfer a portion of your member share to another approved fund with the balance paid to you in cash. This is the same as option 2 except a taxable cash lump sum is also paid to you
  3. Elect a cash lump sum – any cash lump sum is subject to tax.
The cash portion of your withdrawal benefit that you elect is subject to tax as shown in the tax table below, please be aware that the tax table may change from time to time.
See the SARS website for the latest tax tables.
Please note that you are given access to retirement benefits counselling before you decide on the payment of your Fund withdrawal benefit and before your Fund withdrawal benefit is paid to you or is transferred to another approved fund. Please contact the Fund Services Centre if you have not received a call from the Fund Counsellor shortly after you have submitted your withdrawal claim form.

Retrenchment Benefit

If you are retrenched, your member share will be paid out by the fund. You may be entitled to receive an additional amount over and above your member share paid to you by your employer via the Fund. This extra payment, if applicable, will be the lesser of A or B as per the diagram below.
This additional amount is paid by your employer to the Fund. The Fund in turn pays your member share plus the additional amount paid by your employer as a lump sum amount to you. This total lump sum is subject to taxation. The same rate of tax applies as on retirement, as shown under retirement benefits. The same benefit options as set out under resignation/dismissal will apply.
Click here for a summary of the Fund options available to you on Resignation.


In terms of section 37A of the Pension Funds Act, no benefit of a member may be reduced, transferred, ceded or pledged by a fund other than as provided for in the Act. For the same reason, a member in debt may also not pledge, transfer or cede their retirement benefit to satisfy that debt.
Section 37D of the Pension Funds Act does permits certain deductions from a member’s retirement fund benefit. These are:
  • Amounts due in respect of housing loans, granted by the fund/employer or for which the fund/employer agreed to stand surety;
  • Pension interests awarded to former spouses on divorce;
  • Maintenance claims awarded against the member and the fund;
  • Damages due to an employer caused by a member’s misconduct;
  • Amounts specifically approved by the Registrar.
Click Here of more on Section 37D.

The importance of tax advice

You are strongly advised to get professional financial advice before making any decisions regarding your benefit on exit from the fund. The tax you pay on retirement fund benefits is cumulative. This means that the tax you pay on one benefit will impact on other benefits you may receive from other funds. The tax scales are also progressive, which means that the bigger the lump sum benefit you receive, the higher the rate of tax you will be charged.

Fund Counselling

You are given free access to retirement benefits counselling prior to you making a decision on the payment of your fund benefit and before your benefit is paid to you or is transferred to another approved fund (ie any of options 2,3 or 4 above).  Please contact the fund services centre if you have not received a call from the Fund Counsellor shortly after you have submitted your completed withdrawal claim form.

You must be in it to win

On page 3 of the December 2022 Member Newsletter, we announced a competition, where you could win a prize.

All you need to do is have your photo taken next to the Fund’s calendar and/or poster and send it to us. The competition closes on Tuesday, 31 January 2023.

Please send the photo to:

Email: [email protected]

WhatsApp: 081 778 0923

When sending in the photo, please tell us your name, your pension number or identity number and which municipality you work at. Please note that subject to the discretion of the Fund, all or some of the pictures submitted, may be published on the Funds’ website and/or on the Funds’ Facebook page.

Hurry to enter the competition, your photo could win the prize!