On 5 May 2023, the Minister of Finance issued a Notice providing tax exemption for bulk payments made by the fund administrators to former members of closed retirement funds in terms of section 2D of the Second Schedule to the Act. Qualifying payments must meet all requirements specified in the notice:
- bulking settlement payments relate to amounts that became due and payable by the administrator of retirement funds to the retirement funds before 1 January 2008, and
- such bulking payments have not been allocated since the funds were deregistered, and
- the administrator of the retirement funds has entered into an agreement with the Financial Sector Conduct Authority to make such bulking settlement payments directly to the former members of the deregistered funds.
Note that this will be the last opportunity availed in this regard to rectify the error. As such, it is proposed that once the bulking payments are finalised, the provisions relating to them in paragraphs 2C and 2D of the Second Schedule to the Act will be repealed.
Read more in the explanatory memorandum here.
