Pension & Retirement
Tax Calculator.
Calculate the tax on your pension, provident fund, or retirement annuity lump sum — using the 2026/2027 SARS retirement lump sum tax table with the R550,000 lifetime exemption.
R0 – R550k
0%
Lifetime exemption
R550k – R770k
18%
On excess above R550k
R770k – R1.155m
27%
Above R1.155m
36%
Max rate
Retirement / retrenchment lump sums: The first R550,000 received over your lifetime is tax-free. This is a cumulative lifetime exemption — it applies across all retirement fund withdrawals you ever make.
Enter the total of any previous retirement lump sums. If this is your first, leave at 0.
Tax payable
R 0,00
effective rate 0.0%
Net payout
R 500 000,00
after tax
Exemption used
R 500 000,00
of R550k lifetime
Tax bracket breakdown
Rates applied on cumulative lifetime lump sums. Source: SARS 2026/2027 tax year.
⚠️ This is an estimate only
Your actual tax may differ based on your full tax record, prior lump sums across all funds, and SARS assessments. Consult a registered tax practitioner or financial adviser before making fund withdrawal decisions.
Calculate your monthly PAYE on regular income
PAYE Calculator →Data: Effective 1 March 2026 · SARS retirement lump sum tax table · Income Tax Act 58 of 1962 · See methodology
Frequently asked questions
How is a retirement fund lump sum taxed in South Africa?
Retirement lump sums (from pension, provident, or retirement annuity funds taken at retirement or retrenchment) are taxed using a special SARS table, separate from the normal PAYE brackets. The first R550,000 received over your lifetime is tax-free. The next R220,000 is taxed at 18%, amounts from R770,001 to R1,155,000 at 27%, and anything above R1,155,001 at 36%.
What is the R550,000 lifetime exemption?
The R550,000 lifetime exemption is a cumulative tax-free threshold that applies to all retirement lump sums you receive across your entire working life. It is not per fund or per withdrawal — it is the total across all funds combined. Once you have used up R550,000 in lifetime withdrawals, future retirement lump sums are taxed from the first rand.
What is the difference between retirement and early withdrawal tax?
Retirement lump sums (taken at retirement age, retrenchment, or death) benefit from the R550,000 lifetime exemption and lower rates. Early withdrawals (taken before retirement, e.g. when resigning) have a much lower exemption of only R27,500 lifetime and are taxed at the same progressive rates. Early withdrawal is generally very costly from a tax perspective.
Can I take my full pension as a lump sum?
It depends on the fund type. For provident funds and provident preservation funds, you can take your full benefit as a lump sum at retirement. For pension funds and pension preservation funds, you may only take up to one-third as a lump sum at retirement — the remaining two-thirds must be used to purchase an annuity (regular income). Retirement annuity funds also allow one-third as a lump sum.
Is the two-pot system relevant to this calculator?
South Africa introduced the two-pot retirement system from 1 September 2024. Under this system, one-third of future contributions go into a 'savings pot' (accessible with a minimum R2,000 withdrawal per tax year, taxed at marginal PAYE rates), and two-thirds go into a 'retirement pot' (accessible only at retirement). This calculator covers the retirement lump sum tax only — the savings pot withdrawal is taxed differently (at your marginal PAYE rate, not the lump sum table).
Source: SARS — Retirement Lump Sum and Severance Benefit Tax Tables 2026/2027. sars.gov.za. This calculator is for illustrative purposes only and does not constitute tax advice.
Was this page helpful?
Read next
All guides →Free Alternatives to the Sage South Africa Payroll Calculator
Free alternatives to Sage for South African payroll: a no-sign-up PAYE calculator for employees, plus free payroll software options for small employers.
Read guideTop Salary and Tax Calculators for South Africa in 2026
Six SA salary and tax calculators compared by use case — payslip checks, bonus tax and tax return filing, checked against the 2026/27 SARS tables.
Read guideHow to Calculate PAYE and UIF for a South African Employee in 2026
Apply the 2026/27 SARS tax tables to taxable income, subtract rebates and medical aid credits, then calculate UIF at 1% of capped remuneration.
Read guide