Easy equities Alternative

[JacD]

IBKR - I pay no fees and my money is out of the country to invest where and how I want. Been doing it for 10+ years and have not looked back. Closed my local SB Securities account last year and went all in on IBKR using my annual forex allowance.

Use my referral link below and you earn up to USD 1,000 in IBKR stock for signing up.

https://ibkr.com/referral/jacques252

 

[big-l]

JacD, I've just started with IBKR and I was wondering how to handle tax returns. Have you had any difficulties getting reports for your tax return or with SARS querying anything?

If you have any experience with this, I've also been wondering about the taxation of accumulating ETFs that reinvest distributions, e.g. VWRP. Some countries, e.g. UK, tax reinvested distributions even though the investor doesn't receive them directly. I can't find a clear answer for the situation in South Africa.

 

[JacD]

JacD, I've just started with IBKR and I was wondering how to handle tax returns. Have you had any difficulties getting reports for your tax return or with SARS querying anything?

If you have any experience with this, I've also been wondering about the taxation of accumulating ETFs that reinvest distributions, e.g. VWRP. Some countries, e.g. UK, tax reinvested distributions even though the investor doesn't receive them directly. I can't find a clear answer for the situation in South Africa.

I pull the generic reports and input into e-filling accordingly. Dividends or capital gains I work out the exchange rate etc., and I keep the working document should I ever be asked. I also pull the statements monthly and keep separately, they are relatively detailed and should suffice. To date I have yet to be audited or asked for supporting documentation, I just pay the tax due and SARS are happy. I have no experience with ETF`s, I only invest directly in the underlying companies.

Also note you will receive a tax document annually from the IRS showing your dividend withholding, i forget the code of that document but its specifically for foreigners. This can be used for SARS to show you have already paid a dividend tax and are thus only liable for the difference to SARS - consult an accountant on this, gets a bit complex.

 

[big-l]

Thanks, that's very useful to know! I'll definitely consult an accountant.

 

[Paul_S]

What alternatives are there to IBKR and EE? I already use EE but there are many US stocks not available on EE.

I have tried to sign up with IBKR multiple times and I always get rejected regardless of all the low risk options I pick (stocks, no margin trading or derivatives). I suspect that it may have something to do with me being born in another African country instead of South Africa and there is nothing I can do to change or hide that fact so I've given up trying to open an IBKR account. I need another option.

 

[Snyper564]

What alternatives are there to IBKR and EE? I already use EE but there are many US stocks not available on EE.

I have tried to sign up with IBKR multiple times and I always get rejected regardless of all the low risk options I pick (stocks, no margin trading or derivatives). I suspect that it may have something to do with me being born in another African country instead of South Africa and there is nothing I can do to change or hide that fact so I've given up trying to open an IBKR account. I need another option.

Investec goes head-to-head with EasyEquities

As Purple Group makes concessions on its convoluted R25 ‘platform’ fee …

www.moneyweb.co.za

 

[mr_norris]

Clarity is still not available to the public contrary to their own claims when advertising on daily investor.

Can't really call them a competitor unless you happen to bank with Investec right now.

 

[deweyzeph]

One of the big advantages to using EE if you want to invest in USD shares is that all their tax documentation is geared towards South African taxpayers, e.g. IT3B and IT3C certificates, all aligned with the South African tax year.

 

[TheThinker]

I already have IBKR with some cash there but considering moving it to EE mostly for the passive investing in an ETF/Basket.
Do you have any recommendations rather for a ETF/Basket there or on the market? Trend seems to be if on IBKR, stay on IBKR.
Thoughts would be appreciated.

 

[Tongs of Destiny]

I already have IBKR with some cash there but considering moving it to EE mostly for the passive investing in an ETF/Basket.
Do you have any recommendations rather for a ETF/Basket there or on the market? Trend seems to be if on IBKR, stay on IBKR.
Thoughts would be appreciated.

you can have both

why are you not happy with IBKR? they have 900000x more offerings than EE and they're 33300000x cheaper to buy things?

 

[TheThinker]

you can have both

why are you not happy with IBKR? they have 900000x more offerings than EE and they're 33300000x cheaper to buy things?

This is a fair response and true.
Just have USD there so I thought I could consolidate.
I did trade some shares there and won and lost some thus the thinking of just a managed ETF.
Any ideas?

 

[Tongs of Destiny]

This is a fair response and true.
Just have USD there so I thought I could consolidate.
I did trade some shares there and won and lost some thus the thinking of just a managed ETF.
Any ideas?

well IBKR do pay 3.8% on any cash, add that with the usual USD / ZAR depreciation of +5%pa for 30 years so you're getting +8%pa growth just on cash in USD, its a win win for doing nothing!

EE is a lot more expensive to buy and sell, and I mean a heck of a lot, it's the main reason why South Africans don't invest. Then on top of that you have a monthly account fee which you must remember. Only plus is you can invest ZAR into local ETFs which are foreign asset based, so it's Rand hedging. eg. Sygnia or Satrix MSCI or S&P etc etc. even though they are in Rands they match and follow their underlying foreign constituent. Downside to SA ETF's is the amount of them, we hardly have any available. IBKR probably has 10,000 ETFs to choose from, whilst on EE you have 100 with only 20 being foreign, something silly. IBKR you're also limited to R1m per year then you're stuck. EE in ZAR you're not. EE USD account you're also limited to R1m per year then it's blocked.

Managed ETF's like EE global equities TER is around 0.6% pa, it's actually hard to find info on their products. I think that's about the only one that's managed. There are managed ETF's on Satrix and Sygnias website as far as I know

 

[TheThinker]

well IBKR do pay 3.8% on any cash, add that with the usual USD / ZAR depreciation of +5%pa for 30 years so you're getting +8%pa growth just on cash in USD, its a win win for doing nothing!

EE is a lot more expensive to buy and sell, and I mean a heck of a lot, it's the main reason why South Africans don't invest. Then on top of that you have a monthly account fee which you must remember. Only plus is you can invest ZAR into local ETFs which are foreign asset based, so it's Rand hedging. eg. Sygnia or Satrix MSCI or S&P etc etc. even though they are in Rands they match and follow their underlying foreign constituent. Downside to SA ETF's is the amount of them, we hardly have any available. IBKR probably has 10,000 ETFs to choose from, whilst on EE you have 100 with only 20 being foreign, something silly. IBKR you're also limited to R1m per year then you're stuck. EE in ZAR you're not. EE USD account you're also limited to R1m per year then it's blocked.

Managed ETF's like EE global equities TER is around 0.6% pa, it's actually hard to find info on their products. I think that's about the only one that's managed. There are managed ETF's on Satrix and Sygnias website as far as I know

Excellent points.

I looked up the 3.8%.
The minimum to hold there is USD 10,000 for it to be applicable.
However I'll investigate further.

Thanks