Retirement Annuity Savings

The Hollard Retirement Annuity Plan provides a tax-efficient way to save for retirement. It can be taken as an alternative or in addition to your employer pension or provident fund.

You may contribute via both lump sum investments and recurring debit orders. You can invest a once-off contribution at any time and may start, stop, or amend a monthly debit order investment at any time. You may also invest the following retirement fund benefits into the product, subject to the product rules and relevant legislation:

• A pension or provident fund benefit, which is transferred in the event of your resignation, retrenchment, or dismissal from an employer
• A retirement annuity fund benefit is transferred from another retirement annuity fund.
• A pension or provident fund benefits from a pension or provident fund, which has been wound up
• A benefit received as part of a divorce settlement via an approved court order, which the recipient can elect to invest into the Retirement Annuity Plan

Either a lump sum of R50 000 and/or a minimum recurring monthly debit order amount of R500.

• Contributions: Contributions made to a retirement annuity fund are tax-deductible up to a legislated maximum and must be declared on your tax return
• Payments: Income tax will be deducted from any benefit taken in cash before it is paid out on retirement or death, per Income tax legislation. Hollard will apply for a tax directive to facilitate this process
• Investment returns are not subject to Capital Gains Tax, Interest Income tax or Dividend taxes

You can choose from a range of Investment Portfolio options. You may select any one or a combination of them and may switch between portfolios at your discretion.

It is important for you to monitor and review your investment portfolio selection so that it continues to meet your financial needs.

To protect a member’s retirement benefit, the Pension Funds Act contains guidelines that regulate the extent to which a member may invest in certain asset classes. Hollard is required to ensure that each member’s investment complies with these asset exposure limits, which broadly speaking are as follows:

• 75% exposure to equities
• 50% exposure to non-government debt instruments
• 45% exposure to offshore assets (10% of which is an allocation for investment in other African markets outside South Africa)
• 25% exposure to property

Each Investment Portfolio offered to investors in the Hollard Retirement Annuity Plan complies with the Regulation 28 limits.

No, the right to benefits may not be ceded or pledged.

No, the product does not provide a guarantee on the investment value of your investment account, nor does it guarantee the performance of the investment. The market value of the investment may fluctuate at any time. The investor carries the investment and market risk, which may include the possibility of losing capital.

Yes, additional contributions can be added to the investment at any time. You may also invest via a recurring monthly debit order that you can start, stop, or amend at any time.

You are only entitled to withdraw your full benefit prior to retirement in the following instances, subject to legislative requirements and the Rules:

When you emigrate from South Africa if you can prove you have been a non-resident for tax purposes for an uninterrupted period of three years

The value of your Retirement Annuity Plan is less than the current legislated minimum amount of R15 000, as amended from time to time

You may request to retire from the Fund once you have reached the age of 55. You may request an early retirement in the event of permanent disability due to ill-health. Early retirement requests are granted at the sole discretion of the Trustees of the Fund.

You can withdraw a maximum of one-third of your retirement benefit in cash. Tax will be deducted from the withdrawal benefit before it is paid out according to a tax directive issued by SARS. The portion of the benefit, which is not cashed out, at a minimum of two-thirds of the benefit value, must be used to purchase a compulsory annuity from a registered long-term insurer. If the retirement benefit on the date of retirement is R247 500 or less, then you may withdraw the entire benefit in cash.

Your Retirement Annuity investment Plan does not form part of your estate and will not be governed by your last will and testament. In accordance with Section 37 of the Pension Funds Act, the Trustees of the Retirement Annuity Fund have full discretion to award death benefits as they feel appropriate. Dependents will be given preference when allocating the Benefit in accordance with legislation, after which nominated beneficiaries and your estate will be considered. The benefit due to the death of the investor is the value of the investment at the time of processing the death claim, less any fees and charges. Each party who has been awarded a portion of the death benefit will receive it in one of the following ways:

• The purchase of a compulsory annuity from a registered long-term insurer.
• A cash lump sum pay-out
• A combination of compulsory annuity purchase and a cash pay-out. Any benefits taken in cash will be subject to income tax

It is recommended that you appoint a financial advisor to assist you. The Fund, Hollard Life, in their capacity as the Administrator and the Manager does not provide financial advice and may only supply you with factual or administrative information relating to the investment products and portfolios.