What is the tax table for resignation or retrenchment withdrawals?

Withdrawals before retirement (on resignation, dismissal, or retrenchment) use a separate table with a much lower tax-free threshold of R27,500 lifetime. The first R27,500 is tax-free; the next R660,000 is taxed at 18%; amounts between R660,000 and R990,000 at 27%; and above R990,000 at 36%. This makes early withdrawals significantly less tax-efficient than retirement lump sums.

Is the R550,000 tax-free amount a per-withdrawal or lifetime limit?

It is a lifetime limit. SARS tracks all retirement fund lump sums you have received across your lifetime — including any resignation/retrenchment withdrawals (which use their own R27,500 threshold). Once you have used your lifetime tax-free amount, subsequent lump sums are fully taxable from the first rand according to the applicable table.

SA Retirement Fund Withdrawal Tax Calculator 2024/25 — SARS Lump Sum South Africa

SA Retirement Fund Withdrawal Tax Calculator · ZASouth African Tax

Example result based on the prefilled values.

Tax-Free Portion

R550 000,00

Tax on Withdrawal

R101 700,00

Net Proceeds

R898 300,00

Effective Rate

10.20%

Continue your plan

Useful next calculations

Related to this calculation

Use the Retirement Annuity Calculator (South Africa)

Continue with the related investments & savings question this result raises.

Use the South African Income Tax Calculator

Continue with the related south african tax question this result raises.

When to use this calculator

Before accepting a pay change, bonus, pension contribution, or salary-sacrifice option.
When you want to compare employed, self-employed, or dividend-based income scenarios.
When you need a simple take-home estimate before running payroll or filing returns.
When you are approaching the £100,000 income level and want to understand the personal allowance taper effect.
When you are planning a salary sacrifice arrangement and need to see the net pay impact before agreeing terms.

A realistic South Africa planning example

Use these sample inputs as a quick scenario test, then change one variable at a time to compare outcomes.

Withdrawal Amount (R)

1000000

Withdrawal Type

Retirement (lump sum at retirement)

After entering these figures, review tax-free portion, tax on withdrawal and net proceeds together rather than in isolation — each metric tells a different part of the story. Then rerun the tool with one input adjusted to see which variable has the biggest effect on all three outputs before you settle on a plan.

How to read your results

Tax-Free Portion

Review this figure alongside gross income and the local tax rules that apply to you. It is a planning estimate, not a filing result or a recommendation to make a tax decision.

Tax on Withdrawal

Review this figure alongside gross income and the local tax rules that apply to you. It is a planning estimate, not a filing result or a recommendation to make a tax decision.

Net Proceeds

Use this metric to compare scenarios side by side and understand how changes in the key inputs drive the final outcome. If the figure surprises you, isolate one variable at a time and rerun the calculation to identify which assumption is responsible.

Effective Rate

The effective rate lets you compare options on a true like-for-like basis rather than being misled by different compounding periods or fee structures. Use it to cut through headline marketing rates when shortlisting providers or products.

Method & assumptionsAuthoritative sources

This calculator applies the 2024/25 SARS retirement fund lump sum tax tables. For withdrawals at retirement, the first R550,000 is tax-free (cumulative lifetime limit), then 18% on the next R220,000, 27% on the next R440,000, and 36% above R770,000 of the taxable portion. For resignation or retrenchment withdrawals, the tax-free threshold drops to R27,500 (cumulative lifetime), with 18% on the first R660,000 of taxable amount, 27% on the next R330,000, and 36% above that. Both sets of tables are distinct from the tables used for withdrawal before retirement on grounds of disability or emigration. Note that the two-pot retirement system (effective 1 September 2024) introduces a new category of savings pot withdrawal taxed at marginal income tax rates — not via these tables. This calculator covers the traditional lump sum tables only. Always obtain a SARS tax directive through your fund administrator before any withdrawal to determine the exact tax payable.

Common mistakes

!Using an assumption that is not supported by a current local quote, bill, statement or official source.
!Treating a generic estimate as a lender, provider, payroll or tax authority decision.
!Mixing monthly and annual inputs without converting them consistently.
!Forgetting location-specific taxes, fees, eligibility rules or payroll deductions where they apply.
!Testing only one scenario instead of checking how a cautious assumption changes the result.

What to do next

Run a second scenario with a cautious assumption so you can see the downside clearly.
Compare the result with the related calculators below before making a decision.
Check current local rules, eligibility and provider terms before applying or committing money.
Keep a record of the assumptions so you can update the estimate when a quote, bill or pay figure changes.
Use the result to prepare better questions for a lender, provider, adviser or employer rather than treating it as a final answer.

Frequently asked

For a retirement lump sum taken at retirement (from a pension, provident, or retirement annuity fund), the first R550,000 is tax-free over your lifetime. This is a cumulative lifetime limit — if you previously withdrew a lump sum at retirement and used part of the tax-free portion, the remainder is reduced accordingly.

Use arrow keys to navigate items, Enter or Space to expand/collapse.