Accountable Institutions are required to continuously monitor the investment activities of their clients and may from time to time need to contact certain clients in order to understand the nature of those activities better.
Because of the unique nature of our business and the fact that most of it is conducted with little contact with our clients, we've devised a mechanism we call the Source of Funds Value to give us the opportunity to conduct our ongoing customer due diligence as required.
Initial Source of Funds Value (SOFV)
On the creation of the minor account, we allocate it a Source of Funds Value of R36,000 which allows contributors to it to maximise the annual contribution limit of the Tax-free savings account (TFSA).
How does it work?
We keep a tally of the value of the total deposits made across all minor accounts (ZAR and TFSA) in the tax year (1 March to end-February every year).
When a new deposit causes that total cumulative deposit value to exceed the SOFV we:
1. Direct the deposit to a special account, where the money attracts interest at the same rate as if it were allocated directly into your investment account. This is to ensure that your cash remains safe.
2. Have one of our Client Engagement Champions call the authorised user of the account to ask some questions about:
- Their source of funds, and
- Their annual income so that we can consider increasing the Source of Funds Value to operate in line with what we think you're reasonably able to invest in a year.
Can you do anything in advance?
Yes, of course. Should you believe that the SOFV is too low and that your deposits and those of other contributors are likely to breach it in a year, please email one of the documents listed below to email@example.com so that we can evaluate a possible increase to the SOFV or work closely together with you to reset the rules according to how you plan to invest:
- Copy of IRP5 (no older than the previous tax year)
- Copy of a payslip (no older than 3 months old)
- Copy of minimum of two (2) months bank statements (no older than 3 months old)
- Any other 'formal' documents that may be able to prove your earnings to us
If the deposit is a larger than normal sum and of an irregular nature (e.g. a bonus, inheritance, commission, proceeds on sale of assets) you can also email documentary evidence of that particular deposit to us so that we can take that into account too.
Have multiple minor accounts you're responsible for or other family accounts you contribute to?
Please mention that to the Client engagement team member so that he / she can evaluate the SOFV of all accounts you may contribute to in one go.
- This is not meant to be an onerous or difficult process, but rather a consultative one in which we have a chat, get to know you a bit better and update some of your information.
- We assure you that we will safeguard the security, integrity, and confidentiality of any information sent to us as we are required to do as an authorised FSP and in terms of the Protection of Personal Information Act, 2013.
Should you notice a deposit is Uncleared and haven't been contacted yet, or have any questions / concerns with regard to the operation of our SOFV, please call into our Client Service department on the usual number + 27 (0)87 940 6106 stating that you have an Uncleared Deposit or want to talk about your SOFV so that an agent can help you immediately.