By Qiniso Ntuli
On 1 March 2016, the commutation threshold will increase from R75 000 to R247 500, which will have a direct affect on your clients’ retirement decisions.
What does this mean?
The member can qualify for a lump sum payment in cash at retirement if the total of the existing available fund benefit plus benefits already accrued are less than R247 500. Should the amount be more than R247 500, the member will only be entitled to one third as a lump sum payment and the remaining amount must be used to purchase an annuity.