You can move an existing conventional retirement annuity into a Shariah-compliant one without paying tax and without losing the deductions you have already claimed. The mechanism is a transfer under section 14 of the Pension Funds Act, which the FSCA treats as covering individual members who voluntarily move their benefit from one retirement fund to another, and which the FSCA's two-pot guidance says remains tax neutral. The receiving fund does the paperwork: 27four's RA application has a dedicated transfer section, Sygnia and Oasis Crescent accept transfers in, and all three run Regulation 28 compliant Shariah portfolios. The cost is almost never the transfer itself; it is the exit charge an old insurance-based RA policy may levy, which you must quote before you sign anything.
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Why switching the fund, not just the portfolio, is sometimes necessary
There are two different switches, and the first is much easier. If your current RA sits on a platform that already offers a Shariah portfolio, you can usually switch the underlying investment inside the same fund by instruction, with no section 14 process. Old Mutual lists the Albaraka Balanced Fund inside its SuperFund investment menu, Sygnia's fund summary carries the Camissa Islamic Balanced Fund and the 27four Shari'ah range as external options, and most linked investment platforms host at least one of the Oasis, Camissa, 27four or Old Mutual Albaraka funds. Ask your administrator for the fund list before assuming you need to leave.
The second switch is the subject of this guide: moving your entire benefit out of one retirement annuity fund and into another. You need it when the current fund has no Shariah option at all, when it is a legacy life-office policy with a narrow menu, or when the platform's fees are high enough that a cheaper home for the same Shariah fund pays for itself. The retirement hub compares the destinations; the rest of this article is about the move.
What section 14 is and how the FSCA treats individual transfers
Section 14 of the Pension Funds Act governs the transfer of business from one registered fund to another, and the FSCA's Registrar confirmed in Information Circular PF No. 5 of 2016 that the transfer of individual members who voluntarily elect to move their benefit from one retirement fund to another falls under it, together with the requirement for a tax directive. The FSCA's online submission Q&A describes the process as run between the transferor fund and the transferee fund, each submitting required documents, with a cover letter on the administrator's letterhead and a service fee. Members do not file anything with the FSCA themselves.
The FSCA's June 2024 two-pot presentation adds rules that apply to every transfer since September 2024. No transfers can be made into the savings component except the seeding amount. Members may transfer from the savings component to the retirement component but not the other way. Transfers between savings components or retirement components across funds are permitted, but if the savings component moves to a new fund the retirement component must move with it, and on termination of membership all components must transfer together. Vested components transfer under the pre-2024 rules. Transfers remain tax neutral. In plain terms, you cannot cherry-pick a pot; the whole RA goes, and it arrives in the new fund with the same three-way split it had before.
Step by step: how the transfer runs
The sequence below is drawn from the 27four Retirement Annuity Fund application form, which is administered by Prescient, and from the FSCA's description of the section 14 process. Other receiving funds use the same shape with their own forms.
- Request a transfer value and a full charges disclosure from your current fund in writing, asking specifically for any early termination, causal event or alteration charge and the date by which the quote is valid.
- Choose the receiving fund and the Shariah portfolio inside it, checking that the portfolio is Regulation 28 compliant on its factsheet, as the 27four Shari'ah Balanced Fund of Funds and the Old Mutual Albaraka Balanced Fund both state.
- Complete the receiving fund's application with the transfer section filled in: 27four's form asks for the transferring fund's name, FSCA registration number, contact number and approximate transfer amount, and allows up to three transferor funds.
- Sign the receiving fund's section 14 transfer request and any FICA documents; the receiving administrator sends the request to your current fund.
- The transferring fund applies to SARS for a tax directive, which SARS will decline if you have outstanding returns or an unregistered tax number, so check your eFiling profile first.
- The funds exchange the section 14 documentation; the FSCA Q&A notes that where both funds are valuation exempt and the application is within six months of the effective date, a simplified section 14(8) route applies, otherwise a full section 14(1) application goes to the FSCA.
- Your benefit is disinvested, paid across and reinvested in the Shariah portfolio with the savings, retirement and vested components recorded as per the transferring fund's confirmation; 27four's form states that transfers are allocated to components on that basis.
Expect the money to be out of the market for a period between disinvestment and reinvestment. Neither the FSCA nor the funds publish a guaranteed timeline, and complaints about slow transfers are a regular feature of Pension Funds Adjudicator determinations, so start the process in a calm month rather than a week before a contribution deadline.
What the receiving Shariah RAs publish about cost and minimums
Transfers in are generally free of initial fees. 27four's application form states that initial advice fees are not allowed on transfers from one fund to another. Beyond that, the running cost has three layers: the administration fee of the RA wrapper, the management fee or TER of the Shariah fund, and any ongoing adviser fee you agree. The figures below are the ones published on the documents we fetched; the Oasis Crescent Retirement Annuity publishes its charges in its own fund documents, which our Oasis Crescent RA review covers.
| Receiving fund | Published minimums | Administration fee as published | Shariah portfolio cost as published |
|---|---|---|---|
| 27four Retirement Annuity Fund | R10 000 lump sum, R500 monthly | 0.22% on first R5m with internal funds, 0.34% with external funds, excl VAT | Shari'ah Balanced Fund of Funds 0.80% management fee excl VAT, no initial fee |
| Sygnia Retirement Annuity | Not stated on fee page | 0.4025% incl VAT on first R2m for Sygnia funds, 0.46% for external unit trusts, lower tiers above R2m | Camissa Islamic Balanced Class B TER 1.04% in Sygnia's March 2025 summary |
| Camissa Islamic Balanced Fund (via a platform RA) | R5 000 lump sum, R500 monthly direct | Depends on the platform chosen | Management fee 1.25% a year direct |
| Old Mutual Albaraka Balanced Fund (via an Old Mutual or platform RA) | R10 000 lump sum, R500 monthly | Depends on the product | Reg 28 compliant; low balance charge R30 a month excl VAT below R10 000 without a debit order |
Adviser fees are negotiable and capped. 27four's form allows a maximum initial fee of 3% excluding VAT and an annual fee of 1% excluding VAT, with the initial fee capped at 1.5% if the annual fee exceeds 0.5%. Sygnia's published maximums are 3.45% initial and 1.15% annual including VAT. If you do the transfer yourself through the fund's forms, enter 0% in both boxes. The full fee comparison across managers is in what Shariah funds really cost, and the profiles of 27four and Sygnia explain the two cheapest wrappers in more detail.
The legacy policy trap: when the exit charge is the whole decision
Retirement annuities sold by life insurers before the unit trust platforms arrived are policies, not platform accounts. Many carry a recoupment of upfront commission if you stop contributing or transfer out before the policy's term, sometimes described as a causal event charge. National Treasury's two-pot FAQ notes that old generation or legacy retirement annuity policies may be excluded from the two-pot system altogether, and the FSCA presentation says legacy RA funds may be exempted if they meet conditions the FSCA determines. If your RA has no savings component and no seeding happened in September 2024, you are probably holding one of these.
We do not publish a figure for these charges because they are policy-specific and not disclosed on any site we fetched. The only safe method is the written quote in step one. If the quoted exit charge is more than a few percent of the transfer value, run the numbers over your remaining term before moving: a cheap Shariah fund may still win over twenty years, but it may not over five. An alternative for a policy close to its end date is to make it paid-up, stop contributing, direct all new contributions to a Shariah RA, and transfer the old policy only when the charge falls away. Our guide to halal preservation funds deals with the parallel question for employer fund money when you change jobs.
What does not change when you transfer
A section 14 transfer is not a withdrawal. Your contributions keep their deductibility history, the one-third commutation right at retirement survives, and the tax tables at retirement apply exactly as they would have in the old fund. The transfer does not reset the clock on anything. Your retirement date, which must be 55 or later in an RA, is the new fund's rule, so check whether the receiving fund's default retirement age suits you. Regulation 28 continues to apply to the whole benefit, which is why every Shariah portfolio named above advertises compliance; our explainer on Regulation 28 for halal investors sets out what the limits mean in practice.
Who should choose what
If your current RA is a platform account with a Shariah fund already on the menu, switch the portfolio, not the fund; it is free, immediate and needs no section 14. If your RA is a platform account with no Shariah option, transfer to 27four or Sygnia, whichever administration tier suits your balance, and pick the Shari'ah Balanced Fund of Funds or the Camissa Islamic Balanced Fund as the core. If you prefer a single-manager house with its own Shariah board and ecosystem, Oasis Crescent is the destination, accepting that its charges are higher. If your RA is a legacy insurance policy, quote the exit charge first, and if it is heavy, go paid-up and redirect new money rather than transferring.
In every case, a transfer that starts with a written charges disclosure and a checked eFiling profile is the one that finishes without a complaint. Facts checked against fsca.co.za, treasury.gov.za, sars.gov.za, 27four.com, sygnia.co.za, camissa-am.com, oldmutual.co.za on 25 September 2026.
Frequently asked questions
Can I transfer my retirement annuity to a Shariah-compliant fund without paying tax?
Yes. A move between approved retirement annuity funds is a section 14 transfer under the Pension Funds Act, which the FSCA's two-pot guidance describes as tax neutral. The transferring fund obtains a tax directive from SARS confirming no tax is payable, provided your tax affairs are in order. Deductions already claimed are not reversed.
Do all three two-pot components move together?
Yes. The FSCA's guidance states that if the savings component is transferred to a new fund the retirement component must go with it, and that all components must transfer together on termination of membership. The vested component moves under the pre-2024 rules. The receiving fund records the split as confirmed by the transferring fund, so your component balances arrive intact.
How much does a section 14 transfer cost the member?
The receiving funds we checked charge no initial fee on transfers, and 27four's form bars initial adviser fees on transfers altogether. The real cost risk is an early termination or causal event charge on an older insurance-based RA policy, which is not published on any site we fetched and must be quoted in writing by the current fund before you sign.
Can I switch to a Shariah portfolio without leaving my current RA?
Often, yes. If your administrator's fund menu includes a Shariah fund such as the Old Mutual Albaraka Balanced Fund, the Camissa Islamic Balanced Fund or a 27four Shari'ah fund, you can switch the underlying investment by instruction without a section 14 process. Ask for the full fund list and the switching fee, if any, before deciding to transfer out.
What is a legacy retirement annuity and why does it matter?
A legacy RA is an older life-insurance policy rather than a platform account. National Treasury's FAQ says such policies may be excluded from the two-pot system, and they commonly carry charges on early transfer or when contributions stop. If your RA had no seeding into a savings component in September 2024, treat it as legacy and get the exit charge in writing.
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How long does the transfer take?
Neither the FSCA nor the funds publish a fixed timeline. The process involves the receiving fund's request, the transferring fund's disinvestment, a SARS tax directive and the section 14 documentation, with a simplified route available where both funds are valuation exempt and the application is lodged within six months. Allow several weeks and avoid starting just before a tax year end.
