While the implementation of Government’s retirement reform project was due to come into effect from March 2015, Treasury recently announced an indefinite delay in the implementation of the retirement tax reform as well as the implementation of any changes to the rules of provident funds in terms of early withdrawals.

According to Hermann Köstens, MISA’s CEO Strategy and Development, MISA has always supported the idea of responsible retirement investment and to protect such investments. Many employees withdraw their investments prior to retirement, which has a huge negative impact on monetary growth. The delay in the reform is therefore not all good news.

For now, the status quo thus remains. There will be NO compulsory annuitisation of provident fund contributions from March 2015 and NO introduction of the 27.5% deduction limit for tax deductibility.

Article by Hermann Köstens, MISA CEO Strategy & Development.

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