Tax free investment account

SBG Securities Proprietary Limited (SBG Sec)* has launched a Tax Free Investment Account (TFIA)** giving you the opportunity to invest in selected JSE listed instruments tax-free!

Benefits of the TFIA account:
  • No Securities Transfer Tax (STT)
  • No Capital Gains Tax (CGT) when you sell these products
  • No Dividend Withholding Tax (DWT) on dividends earned
  • No tax on interest earned
Key features of the TFIA account
  • A R33 000 annual contribution limit and a R500 000 lifetime contribution limit (there are penalties for exceeding these limits)
  • Selected Exchange Traded Funds (ETFs) are suitable.
  • Profits made in the TFIA account don’t contribute to existing tax annual limits (interest and capital gains), and may be re-invested in the TFIA without using the contribution limit, provided they are not withdrawn.

It is your responsibility to ensure that your contributions do not exceed the limit imposed by regulations. Exceeding these limits will result in punitive taxation taken by SARS.

Trade costs for a TFIA through SBG Sec

When you open a TFIA you will benefit from SBG Sec’s reduced brokerage rate of just 0.25% (excluding statutory charges#). The table below gives you an indication of the costs associated with some of the more common monthly investment amounts:

Monthly Investment Amount Statutory Fees Brokerage Total Transaction Cost
R250.00 R4.49 R0.63 R5.11
R500.00 R4.58 R1.25 R5.83
R1 000.00 R4.75 R2.50 R7.25
R2500.00 R5.28 R6.25 R11.53
R5 000.00 R6.15 R12.50 R18.65
R33 000.00 R14.96 R75.00 R89.96

# Statutory charges include STRATE, Investor Protection Levy (IPL) and VAT.

Opening an account

SBG Sec offers clients the option of opening a TFIA through either their Standard Online Share Trading (OST) platform or, alternatively, through the Standard Bank Internet Banking portal (SBSA IBP). Both options allow you to trade all listed instruments that have been TFIA approved.
Option 1 – TFIA through OST
To register

To open a TFIA through OST, the OST account must be in in the name of an individual (not a company, trust or partnership) and relevant FICA documents must be up to date.

If you already have an OST account, follow these easy steps:

  • Login to your OST account
  • Go to ‘My Account’ on the Home Page
  • Click on ‘Product Registration’
  • Click on ‘TFIA registration’
  • Complete the form and select ‘Open Account’

If you do not have an OST account, you can register for one here.

Account Fees
There is no additional charge to open the account on OST. This is already included in the monthly administration fee of your OST account.

How it works
Investing in a TFIA through the OST platform has numerous benefits. These are primarily because you have access to the full suite of features that OST offers.

Some of the major features of OST are:
1) Direct market access to trade selected instruments. This means that you can buy and/or sell shares real-time, whenever the markets are open with full control of price and quantity.
2) Live pricing and real-time portfolio updates.
3) Access to full price history of all listed instruments, company information and ratios, charting tools, and our comprehensive educational resources.

You may deposit up to R33 000 into the TFIA per tax year, either as a once off payment, or in smaller incremental amounts of your choice. Once your cash has been deposited into your TFIA there is no minimum investment amount into any of the available TFIA instruments. Your cash can be divided among these TFIA instruments as you wish with the remaining balance earning interest at the JSET rate.

Reinvestment and dividends
All proceeds of the TFIA investment after your initial contribution are tax free, and can be re-invested without counting towards your annual and/or lifetime contribution limits.

Option 2 – TFIA through SBSA IBP
To register

To open a TFIA through SBSA IBP you must be an individual (not a company, trust or partnership), in addition to having a Standard Bank Internet Banking account.

Follow these easy steps:

  • Login to your Internet Banking
  • Click on the ‘TFIA’ tab
  • Click on ‘Register’
  • Complete the online registration form
  • Click on ‘Continue’

Account Fees
There is R10 monthly fee (inclusive of VAT).

How it works

You select the listed securities you would like to invest in, with a minimum of R250 per instrument. SBG Sec will buy the required quantity and, based on the price it pays for the instrument on the day of purchase, SBG will allocate the instruments to your TFIA. Please note, all buy instructions will only be actioned by SBG Sec on the 25th of every month.
Buy instructions may be submitted at any time. Kindly ensure this is no later than 23h00 the day before the 25th day of the month.
Your nominated bank account will then be debited with the amount required to purchase the investments. If the 25th day falls on a weekend or a public holiday, the purchase will be made on the following business day.

You can view your account online through the SBSA IBP. The market value of your investments will be shown as per the closing prices of the previous business day.

Should you decide to sell your investments, you may create a sell instruction by clicking the sell button when viewing your portfolio online. SBG Sec will try to sell the investments on the nominated sale date. Sale instructions are executed every Friday. If that Friday falls on a public holiday, sale instructions will be executed the preceding business day (i.e. Thursday). The cash proceeds of the sale will be paid into your TFIA 5 (five) business days after the date of sale. Thereafter, this cash can be paid into your nominated bank account, or used to invest in a different instrument(s).

Reinvestment and dividends

All cash accumulated from distributions of your investments (dividends and interest) is held in your TFIA with the JSE. This money will automatically be used to top up your next purchase, helping to grow your investment further.

This reinvestment may assist with the growth of your investment and does not form part of your annual contribution limit.

For example, if you own 10 shares of an ETF investment and it pays a dividend of R2 per share, you will receive R20 worth of dividends. In your next purchase order, SBG Sec will add this R20 to the funds available for purchase over and above your cash contributions.

* Terms and Conditions apply.

** Please note that this is a product provided by SBG Securities Proprietary Limited (Reg. No. 1972/008305/07). SBG Securities is a wholly owned subsidiary of the Standard Bank Group Limited, an authorised user of the JSE Limited and an authorised Financial Services Provider (FSP No.26691).
** Terms and Conditions apply.

For more information on SBG Securities please go to http://www.securities.co.za .

*** The Standard Bank of South Africa Limited (Reg. No. 1962/000738/06). Authorised financial services provider and registered credit provider.

To find out more about a TFIA account kindly contact 0860 121 161 Or
email securities@standardbank.co.za

Customer care line

South Africa
0860 121 161

International
+27 11 415 5000

General enquiry

Call centre hours (SA)

08:30-17:30
Monday-Friday


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