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Do I pay tax on my pension savings that were transferred to a preservation fund when I resigned?

Posted 14 July 2014 under Tax Q&A


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I resigned from my job late last year. Upon resignation, I transferred my pension fund savings into a preservation fund with the same company that held my pension fund. My tax return shows the entire amount of my pension fund as income under source code 3920 - Lump Sum Benefit. Why is this declared as income when I have not received the money? Does this mean I will be taxed on my preservation of my pension fund savings?

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TaxTim TaxTim says:
14 July 2014 at 16:47

You should not be taxed on this amount, there should be a number at the bottom right hand corner showing a Directive and no tax on the PAYE on lumpsum of the IT3a you received.


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