🏦 Getting your retirement annuity, pension and provident fund out when you emigrate

For many South Africans abroad, the money sitting in a retirement annuity (RA), preservation fund or old employer fund is one of their biggest assets. You can get most of it out after you emigrate, but not straight away, and only if your SARS affairs are in order. This guide explains the current rules, the paperwork your fund will ask for, how the payout is taxed and where applications usually get stuck.

Financial emigration is gone: the three-year rule replaced it

Before March 2021 you could cash out an RA by "formally emigrating" through the Reserve Bank (the MP336(b) process). That route was closed for new applicants, and SARS stopped accepting tax directive applications with the reason "emigration withdrawal" from 1 September 2024, because the enabling law was repealed.

The test now is tax residency. According to the SARS external guide on cease-to-be-resident tax directives (IT-AE-33-G01), you can withdraw if you have ceased to be a South African tax resident for an uninterrupted period of three years or longer. In practice this applies to:

• Retirement annuity funds: you must also have stopped contributing.
• Pension and provident preservation funds: you qualify even if you already used your once-off pre-retirement withdrawal.
• Pension and provident funds (an employer fund you are still a member of): since 1 September 2024 the three-year rule covers the retirement component.

The three years are counted from the date SARS records as the day you stopped being resident, not from the day you got on the plane. If those dates differ, the SARS date is the one that matters. For how residency is decided, see our SARS and tax residency guide.

What the two-pot system means for emigrants

Since 1 September 2024, most South African retirement funds are split into components:

• Vested component: everything you had built up before 1 September 2024 (less the seed amount moved to savings), plus growth on it.
• Savings component: seeded with 10% of your balance (capped at R30,000) on 1 September 2024, then a third of new contributions.
• Retirement component: two thirds of contributions from 1 September 2024. Normally this can only be taken as a pension at retirement.

For emigrants this has two practical effects. First, the savings component is available regardless of residency: you can make one savings withdrawal per tax year (funds set a minimum, commonly R2,000), even in your first year abroad. It is added to your taxable income and taxed at your marginal rate, so it is often an expensive way to access money. Second, once you have passed the three-year mark, SARS confirms you can take the full value of the vested and retirement components as a lump sum, which closes the gap that would otherwise have locked the retirement component in until retirement.

If you leave an employer fund before the three years are up, you can usually take the vested component in cash on resignation (taxed under the withdrawal table), but the retirement component must stay invested. Most people move both into a preservation fund so that they can withdraw everything later under the three-year rule.

Step by step: how to withdraw from abroad

1. Tell SARS you have ceased residence. Update your residency status on the RAV01 (registration, amendments and verification) form on eFiling, entering your cessation date, and submit the declaration, motivation letter and proof SARS asks for. SARS will open a case and may request more documents. The SARS guide states that a directive will be rejected if you never informed SARS that you ceased to be resident.
2. Get your last South African tax return assessed. SARS rejects directives where the latest ITR12 immediately before your departure was not submitted and assessed. Your year of departure return, which splits the year into a resident and non-resident period, is the one people most often forget.
3. Clear any outstanding SARS debt or returns. A non-compliant tax status slows everything down, and SARS can take outstanding debt from the lump sum.
4. Wait out the three uninterrupted years. Long visits home do not automatically reset the clock, but your travel record has to support the claim that you were not resident.
5. Request the fund's withdrawal pack. Each administrator (Allan Gray, Old Mutual, Sanlam, 10X, Momentum, Discovery and others) has its own claim form, and most now have a dedicated emigration or cessation section on their website.
6. Gather the documents listed in the next section and send the complete set at once.
7. The fund applies to SARS for a tax directive. You cannot apply for this yourself: the fund submits the directive request (on SARS Form B for preservation and pension or provident funds, or Form C for RAs) with your supporting documents attached.
8. SARS issues the directive, telling the fund how much tax to withhold. The fund pays the after-tax amount, usually into a South African bank account in your name.
9. Move the money abroad through your bank or a forex provider (see sending money to and from South Africa). The authorised dealer will want to see the directive and proof of the payout.

The documents funds ask for

The SARS guide lists what the fund must attach to the directive application. Expect to provide:

• A certificate of residence from the tax authority of your new country, not older than 12 months. HMRC in the UK, the ATO in Australia and most other tax authorities issue these on request, usually for double tax agreement purposes.
• If your new country's tax authority will not issue one, SARS may accept alternatives: a letter showing you are registered for tax there, a local identity document, a residence or work visa, or a complete scan of your passport (every page, not only the stamped ones). Failing those, a combination of a foreign tax assessment, rates bill, a lease covering at least two years, an employer letter, enrolment at a local institution and foreign bank statements.
• Proof of the three uninterrupted years: passports showing your exits and entries, and your SARS travel diary or foreign tax assessments. A SARS notice of non-resident status alone is not enough, because it does not prove the three years.
• Your SARS tax reference number, ID, and South African bank details, verified the way the fund requires (often a bank-stamped letter).
• Certified copies: many funds will accept copies certified abroad by a notary, solicitor or the South African mission. Check exactly who your fund accepts before you pay anyone to certify.

If you have the full set, send it all upfront. SARS says the fund only needs enough to prove your case, but missing pages are the most common cause of back-and-forth.