Pension Fund payout in Divorce Proceedings
Any person in the midst of a divorce has the following questions and concerns relating to the payout of his / her share of the other spouse's pension fund:
1. What moment of time during the divorce process is used for the calculation of the value of the pension fund?
a) The portion of the pension interest assigned to the non-member spouse in terms of a decree of divorce is deemed to accrue to the member spouse on the date of the decree of divorce.
2. How will the Pension Fund know how the non-member spouse would accept payment of his / her portion?
a) It is advisable that the election to have the amount paid directly to the non-member spouse or the election to have the amount transferred to another pension fund of the non-member spouse be set out in the decree of divorce.
b) Should no election have been made, the Pension Fund must within 45 days of the submission of the Court Order to the Pension Fund, request the non-member spouse to make the election.
3. Whose responsibility is it to submit the Court Order to the Pension Fund?
a) To ensure that the non-member spouse receives his / her portion within a reasonable time, it is advisable that the non-member spouse submit the decree of divorce together with supporting documentation directly to the Pension Fund.
4. How long does it take to receive payment from the Pension Fund?
a) In terms of Section 37D(4)(iii) of the Pension Fund Act, the payment must be done within 60 (sixty) days of being informed of how the amount must be dealt with by the non-member spouse.
We can assist you with the drafting of a settlement agreement and the request for payout that needs to be submitted to the relevant Pension Fund. Contact us today for assistance.