Check out this ultimate guide to learn about the Absa offshore account in South Africa.
We first briefly explain what an offshore account is.
What Is An Offshore Account
This is a bank account in a country you don’t reside in.
You can make and receive payments, hold money, and set up savings and investment accounts in multiple currencies.
The account makes it simpler to do international transactions at competitive rates.
This account allows you to gain exposure to offshore investment markets as part of your offshore investment allowance.
Now that you understand what an Absa offshore account is, we will show you exactly how the account works in South Africa.
Absa Offshore Account
You can access a range of selected offshore unit trust funds that can diversify your investment portfolio in terms of assets, geographic regions, and currencies.
Offshore investments are most likely to outperform local funds due to the global economic conditions and the higher exchange rates.
The account allows you to spread risks across different regions and economies, thus capitalizing on the global opportunities.
Spreading risks ensures stability in terms of portfolio performance.
You create insulation against country-specific circumstances such as political risks.
You are able to access the global markets as only 1% of the global market is represented in South Africa.
This is how the Absa offshore account works in South Africa.
Now that you know how the account works, we will show you the cost of having an Absa offshore account.
What Is The Cost Or Fee For Offshore Bank Account In South Africa
The annual fee for the account is calculated on the market value of units that you hold in a certain fund.
You can negotiate with your financial adviser about the financial adviser’s initial and annual review fees.
To open an Absa offshore account in South Africa, you need a minimum lump sum investment of R50 000.
You are not charged any initial policy charges, but for the first R250 000 investment, you will be charged 0.75% of the investment.
For the next R500 000 investment, a fee of 0.50% applies, and for investments above R750 00, you are charged 0.25% annually.
Most finds in this account declare interest and dividends because they are automatically reinvested.
Any capital gains from the unit trusts are subject to capital gains tax in the investor’s hands.
This is the cost f opening and managing an Absa offshore account in South Africa.
