May I retire after my normal retirement date? If so, what will my benefit be?

Yes, Provided you get the approval of your employer, you may remain in service after your normal retirement date.

 

You will then receive a pension as from your deferred retirement date.  It will be equal to –

 

  1. the pension you would receive if you were to retire on your Normal Retirement Date, but taking into account your Final Average Emoluments and Pensionable Service when your service is terminated, if your own and your employer’s contributions for you are continued.

 

  1. The pension you would receive if you were to retire on your Normal Retirement Date, but increased by an amount as determined by the actuary, if you stay on in the service of the employer in a part-time or temporary capacity and your own and your employer’s contributions for you cease.

 

The deferred payment of your pension will be subject to taxation on the date of its accrual as may be determined by SARS from time to time.

 

The following example shows a typical calculation of this late retirement benefit.  In the example we have assumed that the member retires on 31 December, 2 years and 5 months (29 months) after the member’s Normal Retirement Date and that contributions continue.  At the member’s Normal Retirement Date the member’s Final Average Emoluments were R60 000,00.and the member had completed 32 years and 5 months (389 months) of Pensionable Service.

 

Final Average Emoluments

R65 000

Pensionable Service

32 years and 5 months

Therefore the member receives a pension of –

389/540 x R65 000

 

= R46 824,07 per year

R3 902,01 per month

This pension can be increased as determined by the actuary