Latest News Icon

Update on Retirement Reform

Mentje Larney presented to Parliament’s Standing Committee on Finance, on Tuesday the 2nd of November 2015, dealing with pension fund reforms. The presentation was of the South African Reward Association (SARA) and was in response to the Committee’s call for public comment on the Minister’s proposal to amend the Taxation Laws Amendment Bill (TLAB) that was tabled on 27 October 2015. The proposal from the Minister included the annuitisation requirement for provident funds effective 1 March 2016. However, it should be noted that the provisions dealing with the tax deduction of 27.5% of taxable income (up to a maximum amount of R350 000), is in the tabled bill for implementation effective 1 March 2016 and no comment was invited on this item.

A number of private stakeholders provided oral and written submissions on the proposal for the Committee’s consideration. The most significant of these were probably COSATU who are still very much opposed to the implementation of TLAB without workers’ engagement and consent. National Treasury had an opportunity to respond and they are pushing for complete implementation by next year. We expected the Finance Committee to have finalised their decision by now, but we are still awaiting further correspondence in this regard. We will keep our clients updated once the final Taxation Laws Amendment Bill has been published.