PRESCIENT OFFERS UNIT TRUSTS AND TAX-FREE SAVING ACCOUNTS TO SUIT YOUR NEEDS

Individual investors can access Prescient’s cost effective savings products, designed to deliver certainty over time.

Unit Trusts

What is it?
Collective Investment Schemes (commonly known as unit trusts) are “funds” where the money from many investors are pooled together and invested in assets like shares, bonds, property and cash. This means that investors do not have to manage individual investments themselves, but rely on the skills of appointed investment professionals to manage the fund. Investors hold equally priced units where the price of the unit is based on the value of the underlying investments held in the fund.

Some funds invest in the shares of companies, which mean that part of their profits will be paid out periodically in the form of dividends. Other investments – like government or corporate bonds – make periodic interest payments. You can choose to receive these distributions, or use the money to buy more units and grow your investment.

How do I invest?
You can invest into a unit trust by filling in and returning the application form or using the “invest online” option. All FICA requirements and proof of deposit must be met before an investment will be processed.

What about tax?
There is no tax paid within a unit trust vehicle. You must declare and will be taxed on the capital gain made from a unit trust when you sell it.   Interest income received, must be declared annually and will be taxed along with other interest that you have earned. Unit trusts will deduct dividend withholding tax from investors, as legally required, before dividends are paid to the investor. You will receive a statement every year that clearly states the interest, dividends and capital gain (if you have sold the investment) that you have received.

What are my options?
You are able to select from a range of unit trusts managed by Prescient Investment Management.

What are my benefits?
Easy and cost effective access to diversified pools of investments across various asset classes including equities, bonds, listed property and money market. Standardised and transparent information regarding fund details, including costs, and widely published unit trust prices and performance numbers allowing for regular monitoring. Easy access to funds within 24 hours. Protection for investors via a highly regulated industry.

What about Product Specific Training for FAIS accreditation?
Prescient Investment Management (Pty) Ltd is an authorised Financial Services Provider (FSP 612) under the Financial Advisory and Intermediary Services Act (No.37 of 2002) and provides Product Specific Training as required by Board Notice 194 of 2017 for all of its products.  Registered advisors that require Product Specific Training before providing advice on Prescient products can follow the link below to access our accreditation process, hosted by our outsourced partner, FAIS exchange.  Please ensure that Product Specific Training assessment certificates are saved, in compliance with Board Notice 194 of 2017.

Tax-Free Savings Accounts

What is it?

The South African National Treasury has approved the implementation of a tax-free savings account (TFSA) as an incentive to encourage individuals to save.  The aim is to increase saving over and above retirement based-savings through a more accessible, tax-free product.  From 1 March 2015, individual investors can invest up to R36 000 a year in tax-free savings accounts.  While the capital investment will be capped at R500 000 over the investor's lifetime, all proceeds earned (interest, dividends and capital growth) will be 100% tax free.

How do I contribute?

You are able to contribute in a lump-sum and/or an on-going contribution by debit order.  You are able to invest R36 000 a year (R3 000 a month) and up to R500 000 over your lifetime in your TFSA.

What about tax?

All proceeds earned on investments within the allowed contribution limits, interest, dividends and capital growth will be tax free.  If your contributions are more than the prescribed limit per tax year and lifetime limit, you will be liable to pay a penalty of 40% on any contribution that is over the limit.  The penalty described above will be levied by SARS on assessment for the relevant tax year and will be payable by you.

What are my options?

You can access a TFSA via Prescient Unit Trusts or through Prescient Securities.

The unit trust option offers a range of unit trusts managed by Prescient Investment Management.

Prescient securities offers a tax free savings broker account where clients can choose a portfolio of shares to suit their individual needs.

How do I withdraw?

Withdrawals can be taken at any time, however, whatever is withdrawn cannot be replaced.

What about transfers?

Investors are allowed to transfer their TFSA between providers. This transfer should not be done by cashing in one investment and having the money paid out to you as reinvesting the proceeds with another provider will count towards your annual and lifetime allowance. Please contact Prescient should you wish to arrange a transfer.

View UT TFSA Application Form

 To open a Prescient Securities Tax-Free Savings broker account please contact the administration team on +27 21 700 3741 or email administration@prescient.co.za