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 easy access to your money whenever you need it.
“It is the most cost-effective and flexible way to save for all the sweetest things in life.”
Delia, 41Advantages
Grow your savings without any taxation.
Enjoy unrestricted access to your money. (It’s worth noting, though, that a long-term horizon is recommended to fully realise the benefit of compounding your tax-free return.)
No initial fees, exit penalties or administration fees.
Stop contributing at any time, without penalties.
Choose from a range of funds to suit your investment needs – your fund choices don't have to comply with Regulation 28.
You can open a tax-free investment for minors.
Limitations
Only individual investors in South Africa are eligible (no trusts, companies, etc.).
A regular income cannot be paid out – interest and dividends earned are automatically reinvested.
No protection against creditor claims.
A maximum of R36 000 per annum and R500 000 over your lifetime can be contributed.
You can invest up to R36 000 tax-free every tax year (1 March to end February of the next year) and up to R500 000 over your lifetime. These limits are legally set and apply across all tax-free products you invest in (not per product). If you exceed them, you’ll pay a penalty tax of 40% on the additional amount invested.
All amounts you invest will count towards your annual and lifetime limits regardless of any withdrawals you make. In other words, if you invest R36 000 this tax year and then withdraw some or all of your savings, any further investment during the tax year will be taxed 40%.
Initial administration fee
No initial administration fee is levied on the Sygnia platform.
Annual administration fee (excl. VAT)
No annual administration fee is levied on the Sygnia Tax-Free Savings Account. For the fees relating to the underlying investment managers, please refer to the Sygnia Alchemy Funds document available on request or on the fees page.
| Sygnia Investments | Annual Administration Fee (excl VAT) | ||
|---|---|---|---|
| Value of all accounts | Sygnia Unit Trusts | Sygnia ETFs | External ETFs |
| First R2 000 000 | 0.00% | 0.20% | 0.40% |
| Over R2 000 000 | 0.00% | 0.10% | 0.20% |
Investment management fees
These vary widely across the Sygnia Alchemy fund range. For a detailed breakdown of fund-specific fees, please refer to Sygnia Alchemy Funds on our website.
Financial advisor fees
These are negotiable with your financial advisor within the following parameters:
Initial fee: Maximum of 1.50% (excl. VAT) deducted prior to the investment being made
Annual fee: Maximum of 1.50% per annum (excl. VAT)
Copy of South African green barcoded ID/ South African Smart ID Card, birth certificate (if minor) or valid passport (if a foreign national).
Proof of residential address not older than 3 months.
Proof of bank details not older than 3 months.
Proof of deposit/transfer into the relevant Sygnia bank account.
The Sygnia Tax-Free Savings Account (TFSA) allows you to save for both short- and long-term goals without paying tax on the growth or income you earn. You have instant access to your money whenever you need it, and you are not taxed on withdrawal or termination of the account. TFSA funds qualify as a tax-free investment under section 12T of the Income Tax Act . South Africans qualify for the associated tax benefits – no tax on dividends, income or capital gains – while still enjoying all the benefits of a particular investment vehicle. Contributions to tax-free investments are limited to R36 000 per tax year, with a lifetime limit of R500 000. Amounts invested in excess of these permissible thresholds are taxable at 40%.
Minimum contributions:
Debit order of R500 p/m.
Maximum contributions:
Lifetime contribution of R500 000
Annual contribution in a tax year of R36 000
Debit order of R3 000 p/m.
The contribution limits apply to individual investors with respect to their total investments in all tax-free savings accounts. You may stop contributing at any time with no penalty.
Please note: Minimum lump sum of R1 000 if investing into the Sygnia Money Market Class S1 or S2.