Evil landlord & RAs...

Speedster said:
What you're missing in your sum is that the annual income would be taxable outside of an RA, whereas it is tax free for the duration of the RA. Added to that, outside of an RA you're paying the tax up front as well as CGT on the growth, whereas in the RA you aren't.
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You also had the benefit of no creditors being able to touch your RA if you go bankrupt.
If you die, there is no estate duty on the funds.
 
Speedster said:
What you're missing in your sum is that the annual income would be taxable outside of an RA, whereas it is tax free for the duration of the RA. Added to that, outside of an RA you're paying the tax up front as well as CGT on the growth, whereas in the RA you aren't.
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I think the trick I was missing was the tax savings/refunds; which allow me to contribute more to an RA?So even if at retirement my investment is taxed at the same rate, the additional tax savings more than make up for it...?
 
fire2029 said:
I mean could you theoretically allocate maximum offshore exposure 45% now. Lets assume ffshore conitnues to outperform ...at what point do they ask you to rebalcen to be in line with reg28 offshore limits?
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I'm in a remarkebly similar position as pegging. I've never been asked to actively rebalance, but whenever you add funds you can only add more offshore once you've reached the required local percentage.
 
Speedster said:
That's on the expensive side
  • 10X starts at 1.04% for the first R1m, and then drops lower as the balance increases
  • Sygnia is 0.4% for the first R2m
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So...would you add 0.12-0.18 on top of the 1.04%?
 
Speedster said:
I'm in a remarkebly similar position as pegging. I've never been asked to actively rebalance, but whenever you add funds you can only add more offshore once you've reached the required local percentage.
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Is this on the AG Lisp/platform?
 
Pegging said:
The Life assurers RA's were bad, they did have an insurance component in it I think which paid out if you died before 55 or something.
So if you died it would be beneficial, but it was expensive.

That is the fees. I have a bit in Satrix MSCI as well because AG don't go all in on Overseas equity.

View attachment 1776623
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It's interesting to see the slightly different fees due to, I assume, differing fund values

AG_fees.png
 
Anyone ever ran the calculation of by much your offshore investment taxable account would have to outperform your RA to equal the tax benefits?
 
Pegging said:
About 11% is in MSCI world.
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I meant the difference in fees for the same fund, my MSCI admin fee is a slightly higher percentage than yours.

I've got a 95%-5% split which works out to 60.15% local and 39.84% offshore.
 
Speedster said:
I meant the difference in fees for the same fund, my MSCI admin fee is a slightly higher percentage than yours.

I've got a 95%-5% split which works out to 60.15% local and 39.84% offshore.
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Ok.
This is the total fee

1732621747667.png
 
Speedster said:
I meant the difference in fees for the same fund, my MSCI admin fee is a slightly higher percentage than yours.

I've got a 95%-5% split which works out to 60.15% local and 39.84% offshore.
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Just clicked.

I think it's because we put different amounts in at different times.
So the fees will differ over time.

Over the years I had monthly debit orders of between R1000 and R10000
And in January / February every year I will have added lumpsums of between R50 000 and R150 000
 
3WA said:
Do you have to pay tax on your RA withdrawals? What if you draw down at the income tax threshold? And then fund the rest of your lifestyle using capital gains, and TFSA withdrawals?

Also, upon retiring, if you have a much bigger RA than your ANC wife, can you switch your marriage to community of property and boost your tax exemptions?
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Once you convert to an annuity you must draw down at a minimum rate. 3.5% i think it is.

It doesn't matter who owns the RA you must draw down at least the minimum.
 
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3WA said:
Do you have to pay tax on your RA withdrawals? What if you draw down at the income tax threshold? And then fund the rest of your lifestyle using capital gains, and TFSA withdrawals?

Also, upon retiring, if you have a much bigger RA than your ANC wife, can you switch your marriage to community of property and boost your tax exemptions?
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You can't switch marriage arrangement once married.
 
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Scooby_Doo said:
Once you convert to an annuity you must draw down at a minimum rate. 3.5% i think it is.

It doesn't matter who owns the RA you must draw down at least the minimum.
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Yeah, I think it's 2.5% though which means you need about R6m in the RA to "have" to pay income tax (at over 65 years)
 
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