Benefits and Options

 

Withdrawal benefit

When you leave your employer, the Fund pays your Member Credit Account out to you. Your Member Credit Account is a sum that represents the total contributions made on your behalf, together with the investment returns achieved, less Fund expenses.

 

When withdrawing from the Fund, you have the following options:



Any portion of your benefit that you choose to take in cash will be taxed as follows:

Lump sum Amount Rate of Taxation
R0 - R25 000 0% of taxable income
R25 001 - R660 000 18% of taxable income above R25 000
R660 001 - R990 000 R114 300 + 27% of taxable income above R660 000
R990 001 + R203 400 + 36% of taxable income above R990 000
 
 
A person may only receive a total of R25 000 tax free once before retirement. Therefore, if you withdraw again from another fund,  the amount already received as a tax-free portion previously will be taken into account. 

If you transfer your Member Credit Account to a retirement annuity, another retirement fund, or a preservation fund, it will not be taxed.
 

Retirement benefit

When you reach normal retirement age (65 years) you become entitled to a benefit equal to your Member Credit Account. Your Member Credit Account is a sum that represents the total contributions made on your behalf, together with the investment returns achieved, less expenses.

If you are 55 or older, you may choose to retire early. You will still be entitled to your Member Credit Account.

The Fund also allows membership beyond normal retirement age, subject to the agreement of your employer.

When retiring, you have the following options:







If you choose to defer the date on which you will receive your benefit, please ensure that you indicate this clearly on your Retirement Option Form. As a deferred retiree, you will remain invested in the same portfolio as at retirement, unless you complete a Switch Notification Form. No further contributions can be made, and you will no longer be covered for death and disability benefits.

Any portion of your benefit that you choose to take in cash will be taxed as follows:

Lump sum Amount Rate of Taxation
R0 - R500 000 0% of taxable income
R500 001 - R700 000 18% of taxable income above R500 000
R700 001 - R1050 000 R36 000 plus 27% of taxable income above R700 000
R1 050 000 and above R130 500 plus 36% of taxable income above R1050 000


Any benefit previously received tax free will be deducted from the tax-free amount.

Disability benefit

All active members are eligible to receive a disability benefit. Applications are submitted to an external insurance company for assessment, as this benefit is not provided within the Fund itself.

You would be regarded as disabled and entitled to a monthly disability benefit if, after a six-month waiting period, you are judged to be totally incapable of engaging in your own occupation as at the date of disability (last day actively at work).

If your application is approved, you will receive a disability benefit equal to the sum of 62% of your pensionable salary, until whichever of the following occurs first:



 
 
 
The insurer has the right to request that your medical condition be reassessed after two years. If such an assessment proves that you are capable of engaging in an alternative occupation, your disability income benefit will cease. If you are still considered disabled after two years, benefits will be paid until recovery, normal retirement age, or death – whichever occurs first.

While you are receiving a disability benefit, you remain a member of the Fund, and you still qualify for death benefits. The employer continues to make contributions for you until the end of the month in which you turn 60.

To apply for this benefit, or for more information, please contact your Human Resources Practitioner.

Death benefit

Please read this important notification regarding your premiums for death benefit cover.

The cost of this benefit is deducted from the monthly contribution paid on behalf of the member by the Fund.

The total death benefit is the balance in your Member Credit Account Account, PLUS

Twice your annual pensionable salary, PLUS

If you have a qualifying life partner (spouse): a pension of 35% of your pensionable salary is paid to your life partner.

If you don’t have a qualifying life partner, but you have children, this 35% of pensionable salary will be shared between them and will be paid until they reach age 18 (or age 24 in the case of full-time students).

 



Your beneficiaries can be divided into two groups:

Dependants

Dependants include a spouse, life partner, children and anyone else who may be financially dependent on you.

Nominees

Nominees are beneficiaries who are not financially dependent on you.


Section 37C of the Pension Funds Act and the rules of the Fund state that, in the event of your death, your benefit should be distributed as follows:




Your Nomination of Beneficiary Form is used to guide the Board when allocating the death benefit. They have the right to distribute your death benefit to dependants and/or nominees in a manner that they believe to be fair and just to all parties.

You should review your beneficiaries at least annually or in the event of a life such as a birth, death or separation/divorce. You can download your form here and submit it to HR.



Any portion of your benefit that you choose to take in cash will be taxed as follows:

Lump sum Amount Rate of Taxation
R0 - R500 000 0% of taxable income
R500 001 - R700 000 18% of taxable income above R500 000
R700 001 - R1050 000 R36 000 plus 27% of taxable income above R700 000
R1 050 000 and above R130 500 plus 36% of taxable income above R1050 000


Any benefit previously received tax free will be deducted from the tax-free amount.

After retirement date, or if you are a deferred pensioner, you no longer qualify to receive a death benefit from the Fund.

Funeral benefit

The Fund has arranged for cover as set out below in respect of the Fund member, his/her spouse/life partner, and his/her children (this cover is reviewed annually):

Member, spouse/life partner

R20 000

Child 12 to 21 or age 24 in the case of full time study

R10 000

Child under 12 including stillborn

R5 000


Divorce orders

Legislation makes provision for a member’s Member Credit Account to be shared in the event of divorce. The benefit is paid according to the Rules of the Fund and applicable legislation at the time of the conclusion of the divorce or when the decree is issued.
 
However, many problems arise from incomplete divorce orders.

 



Firstly, if a divorce order or decree for the dissolution of a customary marriage is made against your retirement fund benefits, a certified copy of the order must be sent immediately to the administrators of the Fund. Provided the divorce order contains the required information, the Fund will pay accordingly. The Fund can then notify both parties how much will be paid and to whom.

To ensure that the benefit can be paid from the Fund to your ex-spouse, you should ensure that the divorce order includes following information:

  

Please see the suggested clause below:

The non-member spouse is entitled to 50% of the member’s Member Credit Account in the Unisa Retirement Fund. The Unisa Retirement Fund can be ordered to pay this amount to the non-member spouse.






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