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Tax Free Savings Account US Dividend Investing
#1
Hello South Africa

I want to invest in very long term positions of US shares, and get income from dividends.

I want to pay as little tax and other costs on the dividend income as possible.

The tax-free savings account has caught my interest.

Until I have deposited the maximum allowable contribution of R 500 000, I don't intend to withdraw any money from the account. I will leave the account to compound for as long as possible.

In the long term future, does the tax-free savings account allow one to withdraw regular dividend income after the maximum allowable contribution has been reached?

Is there a tax-free savings account out there that allows one to invest in foreign (US) shares? Could you buy and sell your own shares as you like in such an account?

#2
You can withdraw as much as you like from a tax free savings account any time you want. The only limitations are on your contributions and what you may invest in which are collective investment schemes with no single share having a greater weighting in the fund than 30% (or thereabouts...need to confirm).

So long story short, the closest you are going to get to offshore investing in a TFSA is through a feeder fund. None of our offshore feeder ETFs cater for income except GLPROP which is property/REITS. Actually I think Sygnia has one too.

If offshore income is your goal there might be unit trusts that are way better suited for this.






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