Global Matters: investing offshore
The world of offshore investing can seem quite daunting, but doesn’t have to be. To cut through the complexity, Momentum Investments has launched a world class portal to address all your offshore investment concerns, challenges and even share best practice. Visit our Global Matters portal for independent views on offshore investment advice, legislation and top-of-mind matters to structure and get your clients to their investment goals.
We have held Think Tank for 18 years. It’s called Think Tank as it is designed to give our largest intermediary and wealth management clients substantive investment thinking and ideas rather than the more typical ‘product push/sales’ event which we strictly avoid. Attendees include IFAs, wealth managers and consultants, from South Africa, the UK, Europe, Far East, Middle East and Latin America.
Steering clear of losses
Lorenzo La Posta
Financial losses come in many shapes and forms and investors rightly spend a considerable amount of time worrying about them, but managing loss aversion poorly can make the long-term outcome even worse. It is important to pick the right battles, to trade off cost of protection with loss severity and to not lose sight of the ultimate investment goals.
James Klempster, CFA
There’s no two ways about it: size matters. We live in a society that admires big, yet also reveres the precision of small. When it comes to disadvantages, both large and small can be found wanting. Needless to say, in the world of fund management things are equally nuanced.
Why Momentum Investments?
The Momentum capability wheels
In a daunting investment world full of jargon and complexity, the capability wheels are comprehensive tools to navigate through the spheres of investment platforms, products and the different types of components, both locally and abroad.
Situs tax and when it applies
The video provides a concise view into Situs tax, what it is, when it applies and how to avoid it.
What is probate?
Understanding probate and its effect on a South African estate. The video also cover how you can add overriding contractual arrangements to avoid probate.
Want to know more?
MWI administers the International Endowment Option (IEO) and an International Investment Option (IIO). Please refer to the summary document published by MWI for more detail on the products.
Natural persons, offshore companies and trusts can invest in these products. However, SA companies, Close Corporations (CCs) and trusts do not qualify for a foreign capital allowance and can therefore not invest in these products.
In most instances, an investor’s tax residency will dictate the tax legislation as mostly, the tax legislation where the person resides applies, subject to double taxation agreements. Various countries have double taxation agreements in place to determine where income or capital gains are taxable if the income or gain could be subject to tax in both jurisdictions. SA has a residency- based tax system. This means that, if a person is a SA tax resident, all worldwide income is subject to tax in SA, provided the double taxation agreement does not dictate otherwise.
When investing in an endowment policy governed by the Long Term Insurance Act, the normal rules pertaining to the restriction period and access to funds apply. However, the product is specifically structured with 100 underlying endowment policies to allow for multiple withdrawals.
If the joint and survivorship option is not selected, the investment will fall into the investor’s estate and dealt with in terms of the estate administration process. Depending on the value of the investment, it may be necessary to comply with Guernsey’s domestic system of probate on death. This is an administrative and legal process in terms of Guernsey law that must be followed before the assets of a deceased person may be distributed to heirs.
The additional contract owners are automatically additional lives insured. Upon the death of any one contract owner, the policy will continue and the ownership of the deceased party will form part of his/her estate, which can be subject to Guernsey probate.
Guernsey probate requires Letters of Administration to be obtained in relation to the investor’s estate to enable the Guernsey estate to be properly wound up. To obtain Letters of Administration, the registrar of the Ecclesiastical Court in Guernsey will require the investor’s will to be proved (or authenticated) in Guernsey and submitted together with a death certificate and an inventory stating the values of the estate. This may entail the added cost of appointing a Guernsey advocate to attend to the application.
In Guernsey, the principle of freedom of testation applies to the law of succession. This means that individuals are free to dispose of their estates as they please on death. SA residents may choose to deal with their Guernsey assets in their SA wills or they may execute separate wills for their assets situated locally and in Guernsey.