ANZ PIE Fund - Term Option (2024)

FAQs

Is pie better than term deposit? ›

With a regular term deposit, the interest you earn is subject to your marginal tax rate, which can be as high as 39%. With a PIE term deposit, your earnings are taxed at a maximum rate of 28%. This can make PIE term deposits a more attractive option for higher earners.

You may withdraw all or part of your investment in the Fund by providing us with a completed withdrawal request in the form required by us ('Withdrawal Request') (subject to any deferral or suspension of withdrawals).

Investments are subject to investment risk, including possible delays in repayment, and loss of income and principal invested. Neither ANZ Group nor the Supervisor will be liable to you for the capital value or performance of your investment.

The ANZ PIE Fund is a Portfolio Investment Entity that operates under special tax rules. This means tax on income earned is capped at 28%; so if you're paying income tax at a rate of 30% or higher, you could benefit from the difference. That could give you more money in your pocket after tax is deducted!

Portfolio investment entity (PIE) funds provide some individual and trustee investors with a benefit over holding assets (or investments) directly. This is because PIE funds will pay tax on behalf of such investors at their prescribed investor rate (PIR) with the highest or default PIR capped at 28%.

Can I break the Term Deposit early? A. Yes, our Term Deposits have the ability to be broken early, however a penalty will apply. An administration fee of $30 will be charged and the money withdrawn early will incur an interest rate reduction based on the percentage of the original term that has elapsed.

PIE income is taxed using a PIR, which can be a different rate than standard income tax rates. We'll determine the correct PIR that should have been used for the full tax year. Then we'll work out if there is a difference between tax deducted and tax that should have been deducted on the PIE income or loss.

All fees charged for ongoing management and administration of your investment are treated as tax deductible expenses. We collect your share of these fees by cancelling units in your fund. We then deduct these fees from your PIE taxable income to calculate your PIE tax liability.

When you invest through a PIE, returns on your savings are taxed at your Prescribed Investor Rate (PIR) which is capped at 28%. Your PIR is based on your total income (plus PIE income) over the last two income years. If you have provided your correct PIR, then your PIE tax is a final tax.

Is my money safe in ANZ? ›

Banking with ANZ means we've got your back. Your personal details and sensitive banking information are protected with multiple security measures, helping to keep your money safe.

Safe assets are those that allow investors to preserve capital without a high risk of potential losses. Such assets include treasuries, CDs, money market funds, and annuities. There is, of course, a risk-return tradeoff, such that safer assets typically offer comparatively lower expected returns.

ANZ Group Holdings has a conensus rating of Moderate Buy, which is based on 5 buy ratings, 4 hold ratings and 1 sell ratings.

Unlike distributions from multi-rate PIEs, dividends paid by listed PIEs are taxable, and are not taxed at your PIR. Listed PIE dividends often include tax credits such as imputation credits, which are calculated based on a 28% tax rate.

Entities that meet the eligibility requirements can elect to become a PIE if they are a: managed fund, such as a: – unit trust, or – superannuation fund • company • benefit fund • life fund • group investment fund.

While term deposits can be used for this purpose, a high interest savings account allows you instant access to your cash at any time and may offer a better interest rate than a shorter-length term deposit. These are goals you are planning to accomplish within the next one to five years.

If your PIR is lower than your income tax rate, you will pay less tax on your savings in a PIE than in a regular savings account or term deposit. To work out your PIR see the IRD website at ird.govt.nz (search for 'correct PIR'). Investing in a PIE can minimise tax administration for you and Inland Revenue.

Fixed Deposit Account

If money is deposited in a savings bank account, banks allow a lower rate of interest. Therefore, money is deposited in a fixed deposit account to earn interest at a higher rate. This type of deposit account allows the deposit to be made of an amount for a specified period.

A demand deposit can be accessed at any time and withdraw any amount of funds without prior notice given to the bank. A term deposit can't be accessed at all until the lock period is served. No withdrawals can be made in term deposits until the date of maturity has arrived.