The benefit paid as a lump sum on your death is taxed according to the following fixed scale:

R0 – R550 000	0%
R550 001 – R770 000	18% of the amount exceeding R550 000
R770 001- R1 155 000	R39 600 plus 27% of the amount exceeding R770 000
R1 155 001 and above	R143 550 plus 36% of the amount exceeding R1 155 000

This applies to the aggregate of all retirement fund lump sums received over your lifetime. This means that your dependants cannot get R550 000 tax free from a Retirement Annuity and R550 000 from the UCTRF. Both benefits will be added together and the first R550 000 will then be tax free.  The balance will be taxed according to the above scale.

Any withdrawal or retrenchment benefit previously received tax-free (including any tax-free amount received from your Employer as a severance package), as well as tax-free portions for amounts paid out after 1 March 2009 in respect of divorces or maintenance orders, will be added to the lump sum prior to applying the table.

To calculate how much of your lump sum benefit will be tax free, use the UCTRF Lump Sum Payment Tax Calculator at https://uctrf.co.za/uctrf/exit-tax-calculator