Law Feature: Want to withdraw retirement funds on emigration?
Want to withdraw retirement funds on emigration? National Treasury and SARS say try again in 3 years' time. National Treasury published the Draft Taxation Laws Amendment Bill, 2020 (Draft Tax Bill) for public comment. One of the more contentious proposals in the Draft Tax Bill relates to the ability of people emigrating from South Africa to access amounts in their pension preservation fund, provident preservation fund and retirement annuity fund (retirement funds) when they leave. In accordance with the policy decision to phase out "financial emigration" for exchange control purposes, which was announced in the 2020 Budget Speech, National Treasury and the South African Revenue Service (SARS) have proposed to amend the definitions of the terms "pension preservation fund", "provident preservation fund" and "retirement annuity fund". Joon Chong, partner at Webber Wentzel, explains to Michael Avery how the proposals will work in practice and which funds will be affected.