Creating future wealth with offshore investments

Good day,

As a keen investor, you know that one of the best ways to build future wealth is to diversify your investment portfolio through offshore investments, so that you can choose to study, travel, retire abroad or leave a legacy for your loved ones. But investing offshore can be daunting and complicated.  Liberty’s Offshore Investment Plan offering is an investment plan which allows you to harness the benefits of accessing global markets with strong currencies, while preventing complications of beneficiaries needing to appoint a foreign executor. You can also benefit from global leading asset managers taking care of your money together with great tax benefits and it being a cost efficient investment.

So why invest offshore?

The Liberty Offshore Investment Plan offers access to leading companies and industries through direct offshore investments. This results in a range of benefits that make investing offshore a very attractive option for growing your wealth outside of South Africa.

1) Spread Your Risk

Investing offshore allows you the benefit of diversification. You can spread your risk as you have greater access to different investments in different countries with different economies and opportunities.

With Liberty Offshore Investment Plan, you can invest in offshore index trackers, which include equity, bond and cash trackers.

The cash index trackers are offered in various currencies. Investing in tracker portfolios gives you the ability to access different asset classes at a low cost. Also, you can choose to have a fund manager grow your money by making the investment decisions for you.

2) Tax Benefits

Another step towards growing your wealth is the way in which the investment returns will be taxed. With the Offshore Investment Plan being an endowment, the returns will be subject to income tax in Liberty’s hands at a current rate of 30% and an effective capital gains rate of 12%. Foreign dividends will be subject to withholding taxes at different rates and local dividends will be subject to dividends withholding tax at 20%.

The proceeds from this investment will generally be regarded as capital in nature and tax exempt in your hands as an investor.

The preferential tax rates applicable to the Offshore Investment Plan will work to the advantage of any earner in a higher tax bracket. Also, investors will not be adversely taxed on currency fluctuations.

3) No foreign legal complications

Investments in the Liberty Offshore Investment Plan are a lot less complicated because they still fall under the South African legal jurisdiction. This means that, should you as the investor and policyholder pass away, your loved ones don’t have to comply with any potentially complicated or costly foreign legal requirements.

4) Estate planning

Find comfort knowing that you can specify that the nominated beneficiaries will receive the value of the investment directly when the insured passes away. The investment will be dealt with under South African rules, and can be transferred into an offshore or local bank account of your choice.

5) Expert advice

Liberty’s world-class asset management partners are on hand to help you make the best investment decisions. Transparent advice and exceptional service are guaranteed to make every step of the investment process convenient and easy to follow.

How does it work?

1) An easy to use long term investment

  • The minimum investment for this product is $ 15 000.
  • This will be allocated to the chosen portfolios in the proportions that you have specified.
  • Invest in up to 7 portfolios and change them whenever you would like.

2) How much does it cost to invest?

What is free of charge to you?

  • You can switch between portfolios as often as you like, free of charge to you.
  • If you need to withdraw some of your money, or add money, it is free of charge to you.

3) Bundling

  • You can have up to 10 plans in a bundle with a minimum of $2 500 per plan.
  • Each plan operates independently of each other. The independence relates to, but not limited to, access, portfolio selection and lives assured.

4) Access to your funds

  • The tax, legal simplicity and portfolio benefits of this Offshore Investment Plan are some of the useful benefits as it falls under the Long Term Insurance Act. While this is a long-term investment, we understand that life does not always go according to plan.
  • Should you want to access some of your money sooner than expected, the Act allows you to access your funds once during the first five years. This is at no cost to you. If you need to withdraw funds for a second time within the first five years, you’ll need to draw the full value of the investment.
  • Proceeds of the investment can be paid into any bank account in the name of the owner or beneficiary (if the life assured has passed away). This includes payment into a local or offshore bank account.

Harness the benefits of accessing global markets with different currencies

With Liberty’s Offshore Investment Plan it is simple and easy to invest in a range of different investment portfolios. And you can make use of a South African investor’s foreign capital allowance (currently R10 million per annum) allowed by the exchange control provisions of the South African Reserve Bank. Your funds are denominated in US dollars, and the Liberty Branch is located in Jersey in the English Channel.

Easy options to transfer funds into Jersey account:

  • Use the 24/7 Standard Bank Shyft mobile app. Liberty is pre-loaded as a beneficiary.
  • Standard Bank clients can also use the 24/7 Standard Bank mobile app.
  • Ask your bank to help transfer your funds into our Jersey account via its offshore fund transfer process.
  • Tax clearance before transfer: For South Africans, no SARS tax clearance certificates are required for the first R1 million moved offshore every year. For amounts of R1 million or more*, a SARS tax clearance certificate is required. The easiest way to get a certificate is to use the SARS e-filing website.


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s