What is TFSA Investment?
A tax-free savings account is an account available in Canada that provides tax benefits for saving. Investment income, including capital gains and dividends, earned in a TFSA is not taxed in most cases, even when withdrawn.
What Is The Best TFSA Investment In South Africa?
EasyEquities TFSA
EasyEquities (EE), provides anyone with an opportunity to buy shares of the brands and companies they care about.
You can grow your wealth with whatever amount you have available to invest and the platform allows you to invest your tax-free savings in stocks or ETFs, which means you could get a greater return in the long run.
Allan Gray TFSA
Allan Gray allows you to invest in unit trusts via its tax-free investment account which is a useful product for estate-planning purposes.
Quick note: Allan Gray is aligning itself with the new off-shore limit stipulated by the South African Reserve Bank which is now at 45%.
Ninety-One TFSA
The funds in the Ninety One core range have different risk and return profiles, which clearly address the diverse and changing needs of investors.
Their funds invest in local, global, and emerging markets, and span equity, fixed income, multi-asset, and alternative asset classes.
Select one or more funds from the Ninety-One range of funds to match your investment time frame and risk tolerance.
Fedgroup TFSA
The Fedgroup Tax-Free Savings Account offers a double-digit, guaranteed effective annual return of 10% per annum, which is calculated in accordance with regulation 10A and currently fixed until 29 February 2024.
Plus, they offer estate administration in the event of death, so your beneficiaries can receive the proceeds faster, and with less hassle.
Satrix TFSA
SatrixNOW is a digital investment platform that makes it simple to invest and grow your money in a tax-free savings account.
The app makes it easy to invest and you can see all the costs involved, plus send investment vouchers as gifts.
Coronation TFSA
At Coronation, there are no initial or annual fees.
Instead, investing in an underlying fund/funds will incur annual management fees.
They have a number of investment options available such as Coronation Balanced Plus, Coronation Balanced, Defensive, Coronation Capital Plus, Coronation Market Plus and so much more.
OUTvest TFSA
The OUTvest investment is not simply a tax-free savings account, because you’re not just saving your money, you’re investing it.
They’ve used over 115 years of market and economic data to design a set of investments that are suitable for almost anyone – including four passive multi-asset funds and one actively managed money market fund.
Sygnia TFSA
The Sygnia Tax-Free Savings Account is a savings account that allows you to save for both short-or long-term goals without paying taxes on any of the growth or income you earn.
In addition, you are not taxed on withdrawal or termination of the account – and you have instant access to your money whenever you need it.
Investec TFSA
Investec offers a 12-month fixed deposit that allows investors to enjoy a preferential rate designed to maximize the savings potential in line with an initiative with the National Treasury.
What is the highest tax-free investment in South Africa?
A TFSA is not the only tax-efficient savings option
At current money market rates of between 6% and 7%, an investor in South Africa can keep up to R350 000 in a fixed-income fund before paying any tax on the interest. Ideally, this allowance should be used to set up an investor’s emergency cash pool.
Which bank has the highest TFSA interest rate in South Africa?
Best Tax-Free Savings Accounts in South Africa
| Bank | Tax-Free Savings Account | Nominal Interest Rate (per annum) |
|---|---|---|
| Nedbank | Tax-Free Savings Account | 1.75 – 4.5% |
| Standard Bank | Tax-Free Call account | 2.8 – 3.5% |
| Old Mutual | Tax Free Savings Account | You Pick the Funds |
| ABSA | Tax-Free Savings Account | 0.5 – 4% |
How do I avoid tax on my savings account in South Africa?
Tax-free savings annual and lifetime contributions
There is a limit to how much you can put away in tax-free savings or investments. Your annual contribution may not exceed R36,000 in an annual tax period as defined by SARS and your lifetime contribution may not exceed R500,000.