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Tax benefits of PIE, accessible like bank acct


Monday 31 March 2008

New Call Fund product offers the tax benefits of a PIE but is readily accessible like a bank account

The new National Bank Call Fund provides the benefits of a PIE-compliant managed fund with the customer experience and accessibility similar to that provided by a bank account.

The PIE regime clearly provides a new level of tax efficiency for many investors. However the first thing that customers will notice about the new National Bank Call Fund is the ease by which the investment can be accessed, whether to add to the investment or redeem units in it.

While a managed fund, integration with the systems used to access standard banking products means that customers can access the Call Fund via the Internet, over the phone or at any National Bank branch.

“This means that as a National Bank customer using for example our Online Banking facility, you can manage your Call Fund investment in a manner similar to how you would manage your bank accounts” says Managing Director, National Bank Retail Banking, Craig Sims.

“Or customers can visit any National Bank branch or talk to real person over the phone using our Contact Centre, and we know that many customers prefer this” adds Sims.

“While the language is a little different, through it being a unit trust - subscriptions and redemptions instead of deposits and withdrawals - the Call Fund offers ready access just like a bank account.”

“You can invest in or withdraw from the Call Fund in a similar way that you would with your savings and transaction accounts.”

A key feature of the National Bank Call Fund is that it invests only in call deposits with ANZ National Bank Limited.

The Call Fund is a portfolio investment entity, so tax is paid at the elected prescribed investor rate to a maximum of 30% (reduced from 33% as of 1 April 2008).

“Effectively, tax on your income from the Fund can be lower than tax on income from bank deposits which for many investors is 39%.”

“When you do the sums, for those individuals on a 39% marginal income tax rate, this means that an investor’s returns can be enhanced. For a taxpayer on the 39% marginal tax rate, an 8.10% p.a. return from the Call Fund provides the same after tax return as a bank account paying 9.30% p.a.”

The Call Fund has no entry, exit or management fees for investors.

Investment in the Call Fund earns the same return on every dollar, with one flat rate, currently 8.10% p.a..

The minimum investment is $5,000 and from there you can make regular contributions or invest additional lump sums and income is distributed quarterly.

The product will be available from 1 April 2008.

A copy of the Investment Statement (and application form) and a disclosure statement prepared under the Securities Markets Act 1988 are available from or from any National Bank branch, or phone 0800 80 11 88.

Important information

ANZ Investment Services (New Zealand) Limited is the issuer/manager of the National Bank Call Fund. The National Bank of New Zealand, part of ANZ National Bank Limited is the distributor of units in the Fund. Units in the Fund do not represent deposits or other liabilities of ANZ National Bank Limited. An investment in the Fund is subject to investment risk, including possible delays in repayment and loss of income and principal invested and is not guaranteed by any person. The rate of return is subject to change without notice.


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