A tax - free plan to help you save

With the new Discovery Tax – Free Flexible Investment Plan, you don’t pay any tax on your returns, meaning your savings can grow faster.

New government legislation gives you tax incentives

In South Africa, debt levels are increasingly taking up more of consumers’ disposable income. Studies have shown that 90 percent of South African consumers are living far beyond their means while barely saving anything. This means if they have a sickness or disability, or need to retire, they will not have enough savings to support themselves. National Treasury recently introduced new tax incentives to encourage savings.

Discovery Invest offers you a tax – free savings opportunity

Discovery Invest launched the Discovery Tax-free Flexible Investment Plan, which will be available from April this year. On this plan, you don’t pay any tax on your returns, making this an ideal investment opportunity.

“The new Tax-free Flexible Investment Plan from Discovery Invest is built on the same low-cost platform as the existing Discovery Core Flexible Investment Plan. This gives access to a wide range of Discovery Funds, as well as external funds, with full flexibility and access to your money. You can tailor the Tax-free Flexible Investment Plan according to your specific risk profiles and needs,” says Craig Sher, Head of Product Development and Research at Discovery Invest.

How the Discovery Tax- free Flexible Investment Plan works for you

There are legal limits to contributions to this plan. To invest in the Discovery Tax-free Flexible Investment Plan, you can deposit either a once-off lump sum of R30 000, or recurring contributions of between R850 and R2 500 per month. You are only allowed to contribute up to R30 000 a year and an overall lifetime amount of R500 000 applies. SARS will adjust these limits over time.

The Discovery Tax-free Flexible Investment Plan does not charge any initial fees and only has an annual administration charge of 0.35 percent plus VAT on Discovery Funds and 0.55 percent plus VAT on external funds. Your financial adviser can, however, charge initial and ongoing fees in addition to this for financial advice.

Speak to your financial adviser to assist you in building a portfolio according to your particular needs. Click here to get more information.