Retirement lump sum tax tables explained
General information about SARS's tables, not financial advice. SARS issues the actual tax directive.
The two tables
The retirement table applies to lump sums on retirement, death or retrenchment and to severance benefits. The withdrawal table applies when you take cash from a fund before retirement, for example after resigning.
| Taxable lump sum (aggregated) | Tax |
|---|---|
| R1 – R550 000 | 0% |
| R550 001 – R770 000 | 18% of the amount above R550 000 |
| R770 001 – R1 155 000 | R39 600 + 27% of the amount above R770 000 |
| R1 155 001 and above | R143 550 + 36% of the amount above R1 155 000 |
| Taxable lump sum (aggregated) | Tax |
|---|---|
| R1 – R27 500 | 0% |
| R27 501 – R726 000 | 18% of the amount above R27 500 |
| R726 001 – R1 089 000 | R125 730 + 27% of the amount above R726 000 |
| R1 089 001 and above | R223 740 + 36% of the amount above R1 089 000 |
Worked examples
- R1 500 000 at retirement, no earlier lump sums: tax R267 750, you receive R1 232 250.
- R200 000 withdrawn on resignation: tax R31 050, you receive R168 950.
- R500 000 at retirement after an earlier R300 000 withdrawal: tax R47 700. Without the earlier withdrawal it would have been R0.
How aggregation works
SARS adds this lump sum to your earlier ones, works out the tax on the total, and subtracts the tax that the earlier ones would attract on the current table. Earlier withdrawal benefits count from 1 March 2009, retirement lump sums from 1 October 2007 and severance benefits from 1 March 2011.
How much can be taken in cash
From 1 March 2026, if the value of your retirement interest is R360 000 or less, you can take it all in cash (it was R247 500). Above that, the retirement component must be used to buy an annuity; the amount you may commute depends on your fund's rules and your vested and savings balances.
Try the retirement lump sum tax calculator.
Frequently asked questions
Did the lump sum tables change for 2026/27?
No. SARS lists no changes for the 2027 tax year: the retirement and withdrawal tables are the same as for 2024/25 and 2025/26.
Is the R550 000 per fund or per person?
Per person, over your lifetime. All your retirement lump sums and severance benefits, from every fund and employer, are added together, along with withdrawal lump sums.
Is a two-pot savings withdrawal taxed on these tables?
No. A savings withdrawal benefit is taxed at your marginal income tax rate, not on the lump sum tables.