Lize de la Harpe, Senior Legal Advisor: Regulatory Unit at Sanlam Corporate
Introduction
During the Budget Speech held in March 2025, the Minister of Finance tabled the Revenue Laws Amendment Bill, 2025 (the Bill). The Bill proposed certain technical changes to the Revenue Laws Amendment Act, 2024 (which established the two-pot system that came into effect in September of last year) and introduced clarifications to support the implementation of the two-pot system.
On 22 July 2025 National Assembly approved the Bill whereafter it was sent to the National Council of Provinces for further consideration. On 29 October 2025, the National Council of Provinces passed the Bill without changes. It now awaits signature by the President.
Let’s recap.
Exclusion of over 55’s
In terms of the Revenue Laws Amendment Act, 2024, provident fund members and provident preservation fund members who were 55 or older on 1 March 2021 (T-day) and who remained members of the same fund are automatically excluded from the two-pot system unless they opt in to partake. In essence, to be excluded, these members must remain members of the same fund to which they belonged on T-day.
The 2025 RLAB proposes deleting the reference to provident preservation fund members having remained a member of the same fund.
Seeding calculation date for over 55’s who opt in
Both the Revenue Laws Second Amendment Act, 2024 and the previous draft of the RLAB state that provident fund members who were over 55 on T-day and who remained members of the same fund are automatically excluded from the two-pot system unless they to elect to partake. These members had 12 months from 1 September 2024 to opt in.
Once the member elects to be included, the fund will have to seed 10% of their vested component (subject to a maximum of R30 000) to their savings component to make provision for immediate access. The concern to date has been what date must be used when doing this calculation.
The Revenue Laws Amendment Act, 2024 states that the fund must use the member’s fund value as at 31 August 2024 for this calculation, regardless of when the member opts in. The initial draft of the 2024 RLAB allowed the seeding amount to be calculated based on the fund value as at the end of the month in which the member opted in. However, the Revenue Laws Second Amendment Act 2024 published on 24 December 2024 again did not set out the date to be used for the seeding calculation.
The 2025 RLAB proposes allowing funds the option to select whichever approach was communicated to their members and outlined in funds rules. Put simply: funds must use either 31 August 2024 or the last day of the month in which the election was made, as determined in the fund rules.
The processing of the Bill
The Select Committee on Finance (SCoF) received four submissions from the Institute of Retirement Funds Africa (IRFA), the Association for Savings and Investments South Africa (ASISA), the Law Society of South Africa (LSSA) and Congress of South African Trade Unions (COSATU). The former three stakeholders expressed their satisfaction and support of the proposed amendments in the Bill. SCoF held a virtual public hearing on 10 September 2025 to consider COSATU’s oral submissions and to consider the Bill clause-by-clause.
Conclusion
ScoF’s report on the Bill includes a summary of concerns raised by COSATU, including the issue of allowing members access to their retirement component in the case of job losses. In response, Treasury indicated its willingness to initiate discussions on potential options to enable members to access the retirement component in cases of severe financial distress. However, these discussions and proposals will follow a legislative process that requires changes to be first included in Annexure C of the Budget, after which they would be approved and then included in the Tax Laws for public consultation and legislative processing in Parliament.
ENDS
