Wealth and Investment Management

Wealth Advisory

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Market leading advisory services and estate planning solutions Wealth structuring is not just about preparing assets for events after death. When done well, it ensures that wealth is structured for protection while allowing the benefit of the wealth to be used where needed, during one’s life and after death. Taking account of tax implications at all stages, we have an in-house team of specialists who work closely with clients’ own advisers to devise, develop and deliver a wide range of tailored solutions.

Although we do not give tax and legal opinions, our deep understanding of the relevant rules and regulations can help you to create a wealth plan for you and your family. Forming part of the broader Barclays Group, we have direct access to an integrated global team of professionals operating in a number of onshore and offshore jurisdictions.

Our team of specialists has a deep technical understanding of wealth advisory matters and many of them are former tax and legal professionals.

A superior proposition for your wealth advisory needs Our Wealth Advisory value proposition is built around three pillars that we use to create a wealth planning

Estate planning

• Living wealth plan • Estate planning advice relating to the use of trusts and other entities for asset protection and succession planning purposes • Strategies to deal effectively with estate taxes and death • Assistance with exchange control matters • Drafting and review of estate planning related agreements • Trust reviews

framework that is personalised in accordance with clients’ needs.

Trusts and Wills

• Wills and Trusts: • Drafting and formation • Review and amendment of existing structures • Deregistration of unwanted trusts • Charitable trusts and public benefit organisations • Trusteeships and trust adminstration (local and offshore)

Insurance

• Inheritance and estate planning solutions (estate liquidity provision) • Business insurance • Buy-and-sell cover • Contingent liability • Key person • Tax-efficient use of insurance vehicles (e.g. trust-owned endowments and sinking fund policies)

• Executorships and estate administration services

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Estate planning Our living wealth plan is a comprehensive estate planning analysis that we prepare for clients in which we analyse and review their existing structures. The report provides clients with a single holistic view of their personal and business affairs together with a review of their trusts and wills. We look at issues such as estate liquidity on death, and offer recommendations to address any gaps. Where clients do not require the full Living Wealth Plan, advice can be tailored to address specific issues. One of our Advisory Specialists will work with you to understand your individual needs, requirements and objectives, and will offer you unique solutions that are tailored to your particular circumstances.

• Protecting your assets from creditors and other possible risks to your wealth • Succession planning, both in terms of passing on your wealth to the next generation, or in planning for the future ownership of your business • Planning for contingencies such as death, disability or critical illness • Tax-efficient estate planning • Formation and administration of domestic and cross-border trusts and companies • Dedicated planning for any complex, cross-border assets

Our Advisory Specialists are able to assist with specific issues such as: Trusts, wills and estates A well-drafted will is the cornerstone of any properly considered estate plan and it is important to ensure not only that it is well drafted, but also that it “speaks” to your other structures. For purposes of wealth structuring in South Africa, there is little to rival the trust for estate planning purposes in terms of flexibility and tax effectiveness. Absa Wealth Advisory has partnered with Absa Trust to be able to provide industry-leading wills and trust solutions. Absa Trust is a leading provider of trust services in South Africa, having done so for over 100 years. Forming part of the broader Absa Group, Absa Trust is able to rely on its national footprint to meet the needs of its clients. Absa Trust is a member of the Fiduciary Institute of South Africa (FISA), which ensures that it subscribes to FISA’s code of conduct and meets the professional standards that FISA requires. Through our partnership with Absa Trust, we are able to offer clients industry-leading assistance with the drafting of wills, formation and amendment of trusts, administration of deceased estates and corporate trustee services. Our alignment with Absa Trust in the administration of deceased estates and trusts ensures that we are able to ensure that there is continuity in managing your wealth.

The landscape regarding trusts in South Africa has changed dramatically over the last decade and it is therefore more important than ever for clients to ensure that their trusts are well constructed and managed. As such, there is an ever-increasing need for clients to consider appointing a professional trustee to attend to the administration of their trusts. Through our partnership with Absa Trust, we are able to offer these services to clients, which include: • Secretarial services (meeting agendas, minutes of meetings, drafting resolutions and arranging for signatures where required) • Trustee meetings (arranging, attending and chairing meetings of the trustees) • Financial monitoring and payments • Compliance (interacting with the Master of the High Court when required, maintaining records for purposes of FICA and tax compliance) and • Investments (interacting with the Wealth Manager regarding the investment of trust assets)

Insurance For many people, insurance is one of the most costeffective methods of ensuring that their deceased estate is sufficiently liquid to avoid the delays of having to sell assets to settle liabilities. Absa Wealth Advisory is able to assist you in assessing your liquidity position on death and to help you find a suitable solution to address this need. Insurance is also very useful in providing funding to facilitate the sale of shares in a business on death or disability.

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It can also be used to finance the cost of replacing key persons in a business or to settle outstanding debts should a key role-player die or become disabled. Structured correctly, insurance solutions may qualify for certain tax benefits, and our Advisory Specialists are able to guide you through the implementation of these solutions. In appropriate circumstances, long-term insurance policies also offer a tax-efficient environment for investors.

When to engage with your advisory specialist An introductory meeting with one of our Advisory Specialists can be useful as it may highlight some opportunities for wealth planning that you are not aware of, for example: • You do not have a will or your will is not up to date or it is invalid

• You wish to invest offshore and require advice on the most effective vehicle for this purpose, for example an offshore trust • You have an existing offshore trust and require assistance in ensuring that it functions optimally

• You do not have a trust and could benefit from it as an effective estate planning vehicle

• You wish to expand your business operations outside of South Africa and require assistance in applying for exchange control approval

• You may have an existing trust which has not been updated to take into consideration recent legislative changes affecting trusts

• You may be part of a wealthy and successful family with global interests who have not fully thought through family governance and estate planning

• You may have built up a successful business, but have not implemented plans to allow you to exit it smoothly or to provide liquidity for the sale of your shareholding if you die unexpectedly or become disabled

• You may need guidance with the effective investment of foreign income and inheritances

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Fee schedule At Absa Wealth Advisory, we work together with our clients’ other advisers to make sure that they are provided with holistic advice that is appropriate to their circumstances. By doing so, we are able to ensure that all aspects of their financial affairs are aligned with one another. The objective is always to make sure that our clients’ future goals and objectives can be met and implemented easily and cost effectively.

Our fees are based on an hourly charge-out rate, but we will always let you have a total fee estimate prior to carrying out any work. Although our fees are always dependent on the nature and complexity of the work that we do, the table below provides an indication as to how we calculate our fees.

Service

Fee (excluding VAT)

Estate Planning Hourly rate*

R 1,500.00

Living wealth plan

From R10,000.00

Exchange control applications Review and drafting of estate planning-related agreements

0.1% of application amount Depending on nature and complexity of work

Wills and Trusts Drafting standard will**

R 1,500.00

Wills safe custody

R100 per year

Establishing an inter vivos trust

R 7,500.00

Trust audit

R 3,500.00

Trust amendment

From R2,000.00***

Trust resolutions

From R1,000.00***

Trust administration and trusteeship Deceased estate administration

Determined on a case by case basis 3.5% of the gross estate value and 6% of income generated after death****

Insurance Commission, based on nature of product and size of premium Notes: *All work will be quoted up front. **Non-standard wills will be quoted based on the nature and extent of the complexity of the will to be drafted. ***The actual fee will be based on the nature and complexity of the work to be done. ****Statutory tariff - discounts may be negotiated depending on the nature and complexity of the estate.

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Contact details: Absa Provincial Head Office, Ground Floor Corner of Nelson Mandela & Donald Murray Avenue Brandwag Bloemfontein Tel: +27 (0)51 401 0790 163 Hendrik Verwoerd Drive Plattekloof Cape Town Tel: +27 (0)21 927 6700 6 Nollsworth Crescent Nollsworth Park La Lucia Durban Tel: +27 (0)31 534 4001 177 Dyer Street Hillcrest Pretoria Tel: +27 (0)12 364 1000 East Block, 1st Floor 187 Rivonia Road Morningside Sandton Tel: +27 (0)11 562 0000 Ou Kollege Building 170 Dorp Street Stellenbosch Tel: +27 (0)21 808 6500

FAIS Act Notice and Disclaimer This brochure/document/material/report/communication/commentary (“this commentary”) has been prepared by Absa Wealth, a division of Absa Bank Limited (Registration No: 1986/004794/06) (“Absa Wealth”). Any reference to Wealth Management includes its affiliates. Absa Wealth has issued this commentary for information purposes only and you must not regard this as a prospectus for any security or financial product or transaction. Absa Wealth does not expressly, tacitly or by implication represent, recommend or propose that the securities and/or financial or investment products or services (the “Products”) referred to in this commentary are appropriate and/or suitable for your particular investment objectives or financial situation or needs. This commentary is not, nor is it intended to be, advice as defined and/or contemplated in Financial Advisory and Intermediary Services Act, 37 of 2002 (“FAIS”), or any other financial, investment, trading, tax, legal, accounting, retirement, actuarial or other professional advice or service whatsoever (“advice”). All the risks and significant issues related to or associated with the Products are not disclosed and therefore, prior to investing or transacting, you must fully understand the Products and any risks and significant issues related to or associated with them. This commentary is neither an offer to sell nor a solicitation of an offer to buy any of the Products, which shall always be subject to Absa Wealth’s internal approvals and the execution of all requisite documentation between you and Absa Wealth. You have to obtain your own advice prior to making any decision or taking any action based hereon and neither Absa Wealth, nor any affiliate, nor any of their respective officers, directors, partners, or employees (in whose favour this constitutes a stipulation on behalf of another) accepts any liability whatsoever for any direct, indirect or consequential damages or loss arising from any use of or reliance on this publication or its contents, and irrespective of whether or not you have obtained independent advice. If you are a consumer in terms of the Consumer Protection Act No 68 of 2008, as amended, (i.e. a natural person or an entity with an asset value and annual turnover below R2m) then, the above provisions limit and exclude the liabilities which Wealth Management will have towards you and also place obligations on you. Any South African person or entity wishing to effect a transaction in any information discussed herein must do so only by contacting a representative of Absa Wealth in South Africa, 187 Rivonia Road, East Block, 1st Floor, Morningside, Sandton, Johannesburg, 2196. Wealth and Investment Management a holding division of Authorised Financial Service and Credit Provider – FSP Numbers: 522; 523; 524; 552; 22877 - NCA NCRCP7; NCRCP68