Why can't my client buy a linked life annuity on retirement from a provident fund?

Linked annuities are only available as compulsory purchase annuities. Compulsory purchase annuities mean just that, compulsory. They can only be used where the rules of the fund state that the benefit must be paid as an annuity, of which the legislated amount can be commuted (1/3rd in the case of a pension fund, and any amount in the case of a provident fund).

Where the rules of the provident fund reflect that the retirement benefit is a lump sum, then such lump sum can only be used, after tax, to purchase a voluntary annuity and cannot be used to purchase a compulsory annuity of any nature.