A living annuity is defined in the Income Tax Act (Act no 58 of 1962).

means a right of a member or former member of a pension fund, pension preservation fund, provident fund, provident preservation fund or retirement annuity fund, or his or her dependant or nominee, or any subsequent nominee, to an annuity purchased from a person or provided by that fund on or after the retirement date of that member or former member in respect of which—

(a) the value of the annuity is determined solely by reference to the value of assets which are specified in the annuity agreement and are held for purposes of providing the annuity;
(b) the amount of the annuity is determined in accordance with a method or formula prescribed by the Minister by notice in the Gazette;
(c) the full remaining value of the assets contemplated in paragraph (a) may be paid as a lump sum when the value of those assets become at any time less than an amount prescribed by the Minister by notice in the Gazette;
(d) the amount of the annuity is not guaranteed by that person or fund;
(e) on the death of the member or former member, the value of the assets referred to in paragraph (a) may be paid to a nominee of the member or former member as an annuity or lump sum or as an annuity and a lump sum, or, in the absence of a nominee, to the deceased’s estate as a lump sum; and
(f) further requirements regarding the annuity may be prescribed by the Minister by notice in the Gazette;

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