A two-pot system withdrawal comes from the savings component of your retirement fund. The minimum is R2,000, you may make one withdrawal per tax year, and there is no maximum other than your savings balance. It is taxed at your marginal rate, and SARS must issue a tax directive before the fund pays you.
The two-pot system has applied since 1 September 2024, and the rules below are those published by National Treasury, SARS and the FSCA. For the 2026/27 tax year the period runs from 1 March 2026 to 28 February 2027. Confirm with your fund that nothing has changed since those texts were published.
Eligibility Requirements at a Glance
- Be an active member of a retirement fund covered by the system: private and public pension, provident, preservation and retirement annuity funds are generally covered
- Have a balance in the savings component; since 1 September 2024 one-third of contributions goes to savings and two-thirds to the retirement component, and a once-off seed capital amount was added (10% of the fund value at 31 August 2024, capped at R30,000)
- Withdraw at least R2,000
- Not have made another savings withdrawal in the same tax year
- Be registered for income tax with a SARS tax reference number
- Have no outstanding tax returns with SARS
The system does not apply to legacy retirement annuities, funds with no active members, pensioners, unclaimed benefit funds or beneficiary funds. Provident fund members who were 55 or older on 1 March 2021 are only included if they chose to opt in, and that decision cannot be reversed.
Identification and Account Requirements
You apply to your own retirement fund or its administrator; there is no central application. The National Treasury two-pot FAQ says to apply or enquire directly with the fund. Your savings component stays accessible if you resign, but the retirement component does not.
Your fund must apply to SARS for a tax directive. SARS will not issue it without a valid tax reference number, so register for tax before you apply: unregistered requests are rejected. No SARS office visit is needed. SARS will also not issue a directive if you have outstanding returns, so check your position on SARS eFiling first.
Withdrawals are taxed at your marginal rate. SARS adds the amount to the annual payment calculation, and no retirement tax rates, deductions, exemptions or tax-free amounts are used. This is explained in the SARS explanation of the tax treatment. Tax debt you owe SARS is deducted from the withdrawal first; a formal payment arrangement stops debt deductions, but arrears are still deducted.
Documents and Verification Required
The documents depend on your fund. Treasury and SARS say to apply through the fund, and the fund sets its own forms and verification. Expect to need:
- Your retirement fund membership details
- Your SARS income tax reference number
- Whatever identity and banking confirmation your fund or administrator asks for
Ask your fund or its administrator for the current application route and the exact documents before you start. The FSCA’s FAQ points members to their employer’s HR department for the process, so the starting point can differ by fund.
Fees, Limits and Service Conditions
- Minimum: R2,000 per withdrawal
- Frequency: once per tax year
- Maximum: none, other than the balance in your savings component
- Tax: your marginal rate, with a SARS directive required
- Administration fee: charged under your fund’s rules on each savings withdrawal; administrators must tell you what fee applies
A withdrawal cannot be cancelled once your fund has sent the directive application to SARS. Payout times are not set by SARS, Treasury or the FSCA and vary by fund, so do not commit the money before it arrives. The SARS two-pot page includes a payout calculator that gives an illustration of what you would receive.
The FSCA two-pot FAQ notes that withdrawals attract marginal tax and administration costs, so the amount you receive will be less than the amount you request.
How to Apply, Open or Activate
To make a two-pot system withdrawal:
- Register for income tax with SARS and get your tax reference number, if you do not have one
- Check on SARS eFiling that you have no outstanding returns (tax debt does not block the directive but is deducted from the payout)
- Contact your retirement fund or its administrator and ask how to apply, whether through a member portal or another route
- State the amount you want, at least R2,000 and no more than your savings balance
- Check the administration fee the fund will charge
- Wait for the fund to obtain the SARS directive and pay the balance after tax
Whether your fund offers an online withdrawal, and how it works, is the fund’s own decision. Your fund’s member portal or administrator is where to look.
Frequently Asked Questions
What is the two-pot system withdrawal limit?
The minimum is R2,000 and you may make one withdrawal per tax year. There is no maximum other than the balance in your savings component.
Is a two-pot system withdrawal taxable?
Yes. It is taxed at your marginal rate with no retirement tax rates, exemptions or tax-free amounts, so you receive less than you request.
How do I apply for a two-pot system withdrawal online?
Apply through your own retirement fund or its administrator. There is no central application, and whether a fund offers an online portal is the fund’s own choice. You must be registered for tax with no outstanding returns.
Why was my payment reduced?
Tax at your marginal rate is deducted, along with your fund’s administration fee. Any tax debt you owe SARS is also deducted from the withdrawal first.
Can I cancel a withdrawal?
Not once the fund has sent the directive application to SARS. Contact your fund before that point if you change your mind.
When is the next withdrawal period?
The limit is one withdrawal per tax year, and the 2026/27 tax year runs from 1 March 2026 to 28 February 2027. Ask your fund whether you have already used this year’s withdrawal.
Your retirement fund, SARS and the FSCA set and enforce these rules, so confirm current requirements with your fund before applying. See account and contract requirements and browse all consumer service requirements.