Retirement anuity and withdrawal tax implications
By Evan Robinson · Updated
I just resigned and I want to transfer R150,000 to my retirement annuity and withdraw the R130,000 as cash. What are the tax implication in doing this?
Where is the money currently held?
At ABSA Wealth Builder under the company xxx.
You would pay tax on the entire withdrawal based on the tables in our Lump sum calculator
I was under the impression that I only get taxed on the cash withdrawal and the transfer to my personal retirement annuity fund was tax free? So if I want to withdraw some of the cash, I will not be able to do that?
It is only tax free if you transfer from one fund to another fund such as from a pension fund to a pension preservation fund. What type of fund is the ABSA Wealth Builder?
It is a provident fund, I have R286,000 on the fund and I want to transfer R150,000 to my personal retirement annuity fund at Liberty and withdraw the rest as cash.
You need to transfer it to a Provident Preservation Fund in order for the amounts not to be taxed - however you can speak to your RAF provider at Liberty to see if they can assist you in setting up a tax free transfer.