BT launches tax efficient, low-risk cash fund

MEDIA RELEASE
March 25 2008
BT launches tax efficient, low-risk cash fund

Westpac’s New Zealand fund management business, BT Funds Management (BT), has launched a tax efficient, low-risk unit trust utilising the Portfolio Investment Entity (PIE) regime, the Westpac Cash Plus Trust (Cash Plus).

Cash Plus is designed for low risk investors seeking higher after-tax returns than a term deposit and greater flexibility. Cash Plus has a minimum initial investment of $5000 with the ability to make additional lump sum contributions of $1000 at any time or to make regular investments. Minimum withdrawals of $1000 can be made at any time.

“The major benefit of a PIE fund is that income earned from the fund is taxed at an individual’s Prescribed Investor Rate. Specifically, from 1 April 2008, investors who are on a 39% or a 33 % marginal tax rate will be taxed at 30% on their income from a PIE and will therefore enjoy a 9% or 3% gross tax saving respectively” says the Head of Westpac Wealth, Patrick Middleton.

Cash Plus will primarily invest in New Zealand bank deposits and short term securities with a credit rating of A1 or higher. The objective of Cash Plus is to provide cash-like stable returns with an aim to deliver a return competitive with cash and short-term bank deposits (before tax) on an ongoing basis.

Cash Plus is managed by BT. BT manages and administers around $2.0 billion of funds under management. BT provides a wide range of investment options, including funds managed by its own teams as well as through alliances with global investment managers.

For more information visit www.westpac.co.nz and enter ‘Cash Plus Trust’ in the Search box.

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