emperors

Let fortune favour you

Get It!

Thanks to new National Treasury Legislation, South Africans can now partake in tax-free investing. This means that all proceeds into your tax-free savings investment account will be 100% tax free, so get onboard with an initiative that aims to see your personal savings grow significantly.

Tax: what you need to know

The South African tax system follows one basic principle: if you earn money, you get taxed on it. Keep the following points in mind to better understand the enormous opportunity tax-free investing offers you...

Equities

Traditional equity investing is subject to Dividend Tax. This tax rule dictates that 15% of all dividends is taxable. It is the dividend payer's responsibility to withhold this tax. So therefore, if you earn R100 000 dividends via equities, you'll only receive R85 000.

Unit trusts

When it comes to unit trusts, both interest earned and dividends can be taxed. At the end of each tax year you are issued with an ITB3 certificate which details how much tax you owe, to be submitted with your tax return.

If you sell your unit trusts or switch between two unit trust funds, you are disposing of an asset. This means you are then also subject to Capital Gains Tax.

Capital Gains Tax

Barring certain exceptions, any time you sell an asset, you'll be taxed on your profits (the price you earned from selling it minus the amount you bought it for). Thanks to a tax rebate of R30 000, this tax only applies once you've exceeded this amount.


Tax free savings explained
  • You aren't taxed on your profits. Now you don't have to worry about income tax, capital gains tax or dividend withholdings tax.
  • You can withdraw money without being taxed or penalised. However, it's best to use tax-free investing for long-term investments since any amount withdrawn counts towards your overall lifetime limit of R500 000
  • It's up to you to decide when you want to deposit or withdraw. If your financial position is subject to fluctuations, that's okay. You can tailor your contributions and withdrawals to suit you, however your contributions cannot exceed R30 000 a year for all your tax-free savings account (TFSA) products.
Show me the numbers

Emperor
Asset
Management's
tax-free unit trust.

Our tax-free unit trust mirrors our existing Emperor IP Equity Momentum Unit Trust, which was one of the best-performing general equity class Funds in South Africa for the first quarter of 2015 (As at March 2015).

Learn more about
our strategy

The fine print

You'll be responsible for ensuring that your contributions don't exceed the annual limit. SARS will charge a 41% tax on contributions above the limit so make sure you don't go over it.

How much you can save

Your annual contribution limit:

R30 000

Your lifetime contribution limit:

R500 000

With these allowances in place, this means it will take you over 16 years to reach your lifetime allowance. Whether you’re just starting your investment journey or reaching retirement, it doesn’t matter – the benefits of tax-free saving are not to be underestimated and you can achieve significant capital growth.

Our tax-free unit trust investment amount limits:

Lump sum minimum: R5 000 Lump sum maximum: R30 000 Monthly debit order minimum: R500
The Emperor IP Momentum Equity Unit Trust strategy, explained

The Emperor IP Momentum Equity Unit Trust Strategy, as designed by our CIO Tom de Lange, is purely momentum – one of the first of its kind in South Africa. Momentum investing focuses on finding the strongest shares which are most likely to trade higher. So when shares start to lose momentum, investors get out of the position. In a bear market, this means buying shares that have dropped the least.

The Emperor IP Momentum Equity Unit Trust follows a quantitative momentum strategy, by investing in the JSE’s top 180 most liquid shares. The aim of this strategy is to generate maximum returns with the lowest risk possible, via a pure equities investment. Buying momentum shares adds diversity to your portfolio and allows you access to the fastest-growing capital. This is measured in terms of average weekly trading volumes. A minimum exposure of 80% to South African equities will be maintained at all times, and a maximum of approximately 95%.

Will it suit me?

This unit trust is ideal for investors who are looking for outperformance relative to the FTSE/JSE Top 40 Total Return Index. It offers long-term capital growth, via a strategy that differs from traditional investment

The Emperor IP Momentum Equity Unit Trust is ideally suited to investors who:

  • Seek above market returns at less than 70% of the market risk.
  • Strive to grow their financial assets at a steady pace over the long term.
  • Strive to grow their financial assets at a steady pace over the long term.
  • Seek style diversification.
  • Have an investment horizon of three years or longer.
  • Are comfortable with pure equity investments.

How much will it cost me?

With the tax-free Emperor IP Momentum Equity Unit Trust, we won’t charge any performance fees. This gives your capital an even further chance for accelerated growth. Our management fees sit at 1.5%; however, should we not outperform our benchmark, then no management fees will need to be paid.

Got It!

Whether you're a first-time, mid-life or retirement investor, it's evident that tax-free investing with Emperor Asset Management is well worth your while.

Tax-free investing with emperor, explained

When investing tax free, why not invest with SA's top performer?

  • Our Unit Trust currently has the best risk/return profile on the market.
  • Our Unit Trust is currently the best performing unit trust.

Good

Whether you're a first-time, mid-life or retirement investor, it's evident that tax-free investing with Emperor Asset Management is well worth your while.

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Coming Soon

Emperor Asset Management investment bundles through EasyEquities.

We've partnered with EasyEquities, a low-cost equity investment platform which is also part of Purple Group, to offer four new tax-free ETF investment strategies. Individuals with an EasyEquities account will soon have access to a fully-managed, low-cost, tax-free investment solution.

This tax-free ETF strategy has been created exclusively for EasyEquities by our CIO Tom de Lange, who has tailored it with four risk appetites in mind: Aggressive, Balanced, Moderate and Conservative. Investors can choose from these four, as they benefit from the strategy's following features:

  • There is no minimum investment amount. You can invest as little as R1 if you so choose.
  • If you're more suited to a lower-risk investment, then the Emperor TFSA ETF option via EasyEquities could suit you. The absence of a minimum investment amount puts more control in your hands.
  • You don't have to pick shares – all the work is done for you.

Take note that while Emperor Asset Management is fully managing this investment, it will only be executed through EasyEquities.

FAQs

If you need more nitty-gritty, this is the place to be!

What is the benefit of a tax-free savings account?

  • A tax-free savings account is an effective way to save for your goals. Any interest, dividends or capital gains from your tax-free savings account will be tax free. This means you don't pay tax on the growth on your investment as well as when the proceeds are paid out to you.
  • Your money can grow faster in a tax-free savings account compared to a regular savings account, because you don't pay tax on the investment return.
  • Saving in a tax-free savings account gives you flexibility as you don't have to commit to any future contributions. You can withdraw from your investment at any time. Withdrawing funds, however, may prevent you from reaching your savings goals, and will use up part of your lifetime limit for tax-free savings.

How does a tax-free savings account work?

  • With a tax-free savings account you are not taxed on the growth of the money within this account, you are not taxed or penalized when you withdraw for this account, you can deposit (within limit) or withdraw whenever you like, you may open more than one tax-free savings account (within limits), the limits are based on an individual basis and not per account, breaking the limits will cost you 40% in that tax year, lump sums and monthly deposits are welcome, and you have control.

How do I get an Emperor Asset Management tax-free savings account?

  • Please complete our account opening document and compile your FICA documentation (Copy of ID, proof of residence and proof of bank details). Once compiled, please send them to newaccounts@emperor.co.za.

How much can I deposit in a tax-free savings account? What are my limits?

  • National Treasury has put limits on the amount you can save in a tax-free savings account. The total annual contribution in a tax year may not exceed the annual contribution limit, which is currently R30 000 per tax year. The total lifetime contribution may not exceed R500 000. Make sure you keep track of how much you've invested so that you don't exceed your limit across all approved tax-free savings accounts (at Emperor Asset Management or other providers), otherwise SARS will charge you a penalty of 41% on the amount you contribute that exceeds the limits.

More...

What do you mean by limits on an individual basis?

  • The tax-free savings account or tax-free savings plan allows an individual to not pay tax on specified tax-free savings accounts. This tax exemption is based on individual capacity. This means that even though you may have several tax-free savings accounts you have the one limit of R30, 000 per tax year across all your accounts. This also means that you can only open a tax-free savings account in the name of an individual and not a company or trust. Lastly, you are responsible in ensuring that you do not exceed the limits – even if we at Emperor Asset Management put controls in place, we cannot account for additional tax-free accounts.

What control do I have?

  • You choose when to deposit or withdraw money from your tax-free savings accounts.

Do I have to keep my money invested for a specific amount of time?

  • No, you choose how long you want to invest. We believe that for you to fully benefit from a tax free investment, you need to have a long term investment approach.

If I don’t invest up to the R30 000 limit per tax-year does the limit rollover?

  • No, unfortunately not. There is no rollover with limits, i.e. if you contributed R10 000 in year 1 you can’t contribute R50 000 in year 2.

Are there limits to the amount of dividends I receive?

  • There are no limits on the dividends you could earn from investing in our Tax Free Unit Trust.. So go ahead and enjoy tax-free returns and portfolio growth – remember the longer you are invested the bigger the tax saving.

Can I open a tax-free savings account for my children, spouse or family member?

  • You can open a tax-free savings account for a family member but you will be using part of their tax-free allowance. This may limit their ability to take advantage of tax-free savings and dividends earned in future.

Can a tax-free savings account form part of an inheritance?

  • Yes, a tax-free savings account will form part of a person’s estate and estate duty will still be applicable when the person passes away.

Can I transfer money between my Emperor Asset Management accounts?

  • Unfortunately not, a paper trail needs to exist and that means the money has to come from your bank account. If you have other investments with us, you will have to withdraw the money, realise the cash and invest it in the tax-free unit trust.

What are the reporting requirements to SARS?

  • Both service providers and tax payers who make use of the tax-free accounts will be required to provide information to SARS in the prescribed returns.

What fees are payable?

  • Service providers may not charge performance fees on tax-free savings accounts.