Benefits on resignation
When a member resigns or is discharged from government service, he or she receives a resignation benefit.
The GEPF offers two options for the payment of the resignation benefit:
- Have it paid into a bank account as a cash lump sum; or
- Transfer it to an approved pension preservation fund.
Option 1: Have the cash resignation benefit paid into a bank account
If the member chooses this option, a cash lump sum –gratuity, after the tax deductions, will be paid into his or her bank account.
How to apply for the cash resignation benefit:
The Human Resources department needs to submit the following documents:
- A certified copy of the member’s bar-coded ID or valid passportthat is not older than six months.
- A correctly completed Personal Details form (the Z864 form).
- Correctly completed Banking Details form (the Z894 form).
- A correctly completed Resignation Choice form. This applies for resignation only and not necessary on discharge.
- A certified copy of the marriage certificate if a member is married.
- If the member is divorced, the divorce order and settlement agreement.If the settlement agreement says that some of the pension money must be paid to the ex-spouse, the GEPF also needs a certified copy of his or her bar-coded ID and a Banking Details form.
- If the member has children, please submit certified copies of their birth certificates.
Next, the Human Resources department needs to complete a Withdrawal from Fund Application form (the Z102 form) and submit this to GEPF, along with all the other documents supplied.
Option 2: Transferring resignation benefit to an approved pension preservation fund
The advantage of this option is that tax is not payable on resignation when the amount is transferred straight into an approved pension preservation fund. However, tax is payable if and when the member leaves the new pension preservation fund that he or she has transferred into.
GEPF will transfer the member’s actuarial interest in the Fund into the new approved fund. The actuarial interest is the value of his or her “share” in the Fund. This amount is calculated using a set formula specified in GEPF’s rules.
To qualify for the transfer option, the member must choose an approved pension preservation fund. This means a pension preservation fund or retirement annuity, and not a provident fund.
The difference between the two is this:
- In a pension preservation fund a member is forced to leave at least two-thirds of the money being transferred into the new fund until retirement. This means a member is still making provision for own pension, which is in one’s best interests.
- In a provident fund, a member is allowed to withdraw the full amount before retirement. This could leave a member without a pension when one needs it one day.
For any questions about approved pension funds, or any other aspect of pensions, members are invited to visit the nearest the GEPF Walk-in-Centre or call the toll free Call Centre on 0800 117 669.
How to transfer a pay-out to an approved pension preservation fund
The Human Resources department requires the following documents:
- A certified copy of the member’s bar-coded ID or valid passport that is not older than six months.
- A correctly completed Transfer Application Z1525 form. The member and a representative of the new pension fund must sign this form.
- A correctly completed Personal Details Z864 form.
- A correctly completed Resignation Choice form. Only on resignation; not necessary on discharge.
- For married members, a certified copy of the marriage certificate is required.
- If the member is divorced, the divorce order and settlement agreement. If the settlement agreement says that some of the pension money must be paid to the ex-spouse, the GEPF also needs a certified copy of the bar-coded ID and a Banking Details form- form Z894.
- If a member has children, certified copies of their birth certificates are required.
The Human Resources department needs to complete a Withdrawal from Fund Application Z102 form and submit it to the GEPF, along with all the other documents supplied.
