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Type of Fund: Provident Fund
Registrations: Financial Services Board and the South African Revenue Services.
Risk Profile: Moderate (Balanced investment mandate in accordance with Prudential Guidelines)
Administrator: Oasis Crescent Retirement Solutions (Pty) Ltd
Investment Advisor: Oasis Crescent Capital (Pty) Ltd
What is it?

The Provident Fund allows for separate contributions from two sources, namely the employer and employee. The respective contributions would then be made in accordance with the rules of the fund, by entering into what is known as special rules.

It is a retirement product that is ideally suited to smaller companies, institutions or schools, and would usually provide underlying investors with relatively low administration and investment management fees, as they are shared by all the investors in the fund.

In most instances, one is able to receive tax relief on a proportion of the contribution that is invested in a retirement fund. There are also a number of benefits that may be derived when the policy reaches maturity. To fully appreciate the tax benefits that are provided by these funds, clients should consult their tax adviser. Investors may be allowed to make use of various investment options to facilitate various forms of diversification options and customised risk proles. These products are required to follow prudential investment guidelines, which maintain a degree of diversification by asset class.

Key Characteristics

A provident fund allows for separate employee and employer contributions. Should an investor satisfy the requirements for tax relief, then the investor may be able to claim back the amount of income tax that would have been paid on the respective contributions. If the respective retirement fund is unitised, the investor may be able to choose from various alternative investment funds that would usually be associated with different risk profiles. The respective  investment funds would provide various diversification benefits as they would usually invest in a large number of securities from within different sectors, geographic locations, etc.

The Benefits

Investors should consult the respective terms and conditions. Benefits are payable on your retirement, withdrawal (subject to current limits), death
or disability. Please refer to the Retirement Fund Death and Disability slide.

Withdrawal or Retirement

Retirement Lump Sum Benefits

Lump sums accruing between 1 March 2014 and 28 February 2018

Taxable portion of withdrawalRates of tax
R 0 - R 500 000Nil
  R500 001 - R 700 000  18% of the amount over R 500 000
 R 700 001 - R1 050 000  R 36 000 + 27% of the amount over R 700 000
1050001 +
R130 500 + 36% of the amount over R1 050 000

Withdrawal Lump Sum Benefits

Lump Sum accruing between 1 March 2014 and 28 February 2018

Taxable portion of withdrawalRates of tax
R 0 - R 25 000Nil
 R25 001 - R660 00018% of the amount over R 25 000
 R660 001 - R990 000R114 300 + 27% of the amount over R660 000
 R990 001 +
R203 400 + 36% of the amount over R990 000

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