John Rose and Kevin Caden are the managing director and director, respectively, of Iza Wealth, an independently owned South African financial advisory firm that offers holistic, objective offshore investment solutions. John has over 20 years of experience in healthcare, financial services, and wealth management. Kevin has 10 years of experience in asset management and financial regulation in Ireland and South Africa. Iza Wealth's team of advisors assists clients with offshore investment portfolios focused on foreign exchange, offshore investments, and retirement/estate planning. The document then discusses the potential effects of Brexit on South Africa and outlines four scenarios for how Brexit could impact trade between the UK and South Africa.

1. BrexitSA

2. John Rose completed his articles at KPMG in 1998 and since has worked across industry
sectors with 3 years spent in retail financial management. John has 7 years of extensive
experience in the healthcare sector, where he has performed as deal maker, corporate
financier and fulfilled roles in both Financial and Managing directorship. John’s move
into financial services was with Waring’s as Group FD in 2008, where he headed up
Structured and Group Finance. Waring’s move to KZN in 2011 prompted John to start
his own Offshore Wealth Management company. John serves as Managing Director
leading the Offshore Wealth Management team at Iza Wealth.
Kevin has worked in the asset management industry for the past 10 years. After
completing his articles with Deloitte Ireland in 2011 he held various roles in the asset
management and banking industry in Ireland. Before emigrating to South Africa in
2013 he worked as a Financial Regulator of Irish Collective Investment Schemes with
the Central Bank of Ireland. Kevin joined the SAICA body in 2013 and worked at
Stonehage Fleming for two years before joining Iza Wealth.
John Rose - CA (SA)
Managing Director
Kevin Caden - CA (SA)
Director
Iza Wealth has also a team of 4 additional experienced professional advisors
around the country
Who are we ?

3. About Us
We are an independently owned (2 Partners) professional team of
financial advisors offering – holistic, objective and independent
advice predominantly in the offshore market.
Ownership
What we
do
We assist clients with implementing & managing financial plans
and focus on the following pillars:
 Forex: externalizing clients capital offshore
 Offshore Investment Solutions
 Retirement Planning/Estate Planning/Tax Planning

4. The Brexit effect for SA
The UK is the 4th largest export partner for South Africa:
• Platinum, motor vehicles, fruit, wine, skincare products,
beef, sugar and rooibos tea
The UK is #1 FDI for WC
Net Trade surplus R24,5 Billion
The UK is the number 1 country for tourists into South Africa

5. The Brexit effect for SA (continued)
Current
Status
Effect
• We trade with the UK under EU – SADC Economic Partnership
Agreement.
• SACU + M at present.
• 99% of goods enter Duty free into the UK.
• USA and Australia has always traded with UK On a EU MFN tariff basis.
• We need to ratify with UK this will continue under new agreement – this
is before parliament now.
• The Most Favoured Nation principle in the highly unlikely case of a no
deal Brexit revert to WTO rules.
• Country must extend same terms as MFN to those who belong to WTO.
• Therefore if UK leaves EU customs union and there is no preferential
agreement in place defaults to MFN basis .
• UK Exports will face those countries tariffs on a MFN basis.
• RSA, without the agreement in place, would take a big knock having to
pay duties on exports

6. The Brexit effect for SA (continued)
• UK has published MFN details in case of no deal Brexit, effective 1
year.
• Such is what SA will face unless NEW deal is ratified.
• Tariffs would be on items like vehicles , beef and sugar.
• This could be problematic to SA as the duty free products would
suddenly be faced with stiff competition.
• Wine is a good example as we compete with Australia. Suddenly
we would be on a level playing field as they too would be duty
free.
Where does this leave us ??
Current
Status
Effect

7. The 4 Scenarios for SA
Scenario 1
• May’s Deal
Scenario 2
• No Deal!
Scenario 3
Orderly & Managed
Brexit
Scenario 4
• No Brexit!

8. Scenario 1 – Mays Deal
• UK Remains part of EU Customs union
• 2 year transition
• Leave 22 May 2019
• No UK Border disruptions
• UK trying to rollover existing EU Agreements
Highly improbable as has been rejected !
Details
Impact
• SA continues to trade with UK under the EU Economic
Partnership Agreement.
• Then new deal kicks in which is same as old preferential SA
deal.

9. Scenario 2 – No Deal !
• Trade between UK and all countries without roll over
agreement reverts to WTO rules.
Details
Impact
• Major disruptions :
• Customs and Border checks
• Regulatory standards no longer auto accepted between
EU and UK .
• Long delays from EU ports to UK borders.
• SA goods using EU inputs (cars) sent to UK or vice
versa.
• SA goods will face UK’s MFN tariffs.
A ratified preferential agreement with UK would allow
SA goods preferential access

10. Scenario 3 – Orderly and Managed Brexit !
A ratified preferential agreement with UK allows SA
goods preferential access – which is highly likely.
• Need to get cross parties to agree to deal.
• Series of votes to that end.
• Need to reopen EU negotiations and EU would have to agree.
• UK to go into the EU elections and guess who is leading ?
Details
Impact • SA goods will face UK’s MFN tariffs if no deal done.

11. European Election Voting Intention
Source: Opinium / Observer Poll

12. How do the UK’s political objectives compare with
the EU’s off-the shelf options for future relations?

13. Scenario 4 – No Brexit !
• Second referendum would need to be held.
• Series of votes would only enable this and by and large this
has been ruled out.
Details
Impact
• SA would continue to trade with UK under the EU EPA .
• Ultimately SA Goods will continue to have preferential
access to the UK once the new agreement has been ratified.
• SA is well placed at this juncture to have put the necessary in
place to benefit accordingly.
Highly unlikely outcome, as this has been ruled out

14. Protecting and Generating Global Wealth

15. Clients top financial aims & objectives
Source: Adapted from WORLD ULTRA WEALTH REPORT 2012 - 2013. WEALT –X, HSBC Expat Explorer Survey 2012, Cap Gemini World Wealth Report 2012
12%
23%
65%
Absolute
financial security
in retirement for
him and her
Educating the children and
helping them become
financially independent
Efficient passing on of
unused wealth on death
Preserve & Protect Wealth

16. Client wants…
Plus….it has to be
transparent,
robust &
legitimate!
Source: OTAP adviser research 2014.
I Want
But I don’t
Want
No1

17. Challenges clients are facing
Cost of
ageing
Time
value of
money
Long-life
Market
risk
Risk
transfer
(DB to
DC)
Rand
Taxation
Exchange
control
Investment
diversity
Legislation
&
Jurisdiction
Political
agenda
Source: OTAP, SA and Global Markets Insights – Socioeconomic Factors Impacting Wealth & Succession 2014 & 2015

18. Political economics
Source: 2015 International Tax Highlights, Deloitte.

19. Brexit Proofing your Portfolio
Source: 2015 International Tax Highlights, Deloitte.
 Invest in hard currency not through ZAR feeder funds / asset swaps
 Utilise your annual R1million Discretionary allowance annual
10million Foreign Investment Allowance
 Invest in global defensive funds/managers with robust strategies
and companies – consumer discretionary / consumer stable stocks
 Limit exposure to direct UK mid/small cap equities
 Think active not passive at this stage in the cycle

20. Investment Types

21. Iza Wealth Investment Solutions
Direct
Investing
Tax Wrapped
Solutions
Offshore
Pensions

22. Offshore Direct Investment - Overview
• Low cost Investment solution
• Investment fully liquid and flexible
• Initial capital tax free on repatriation to
South Africa.
• Gains taxed at Capital Gains Tax rates.
(16.4% or 18%)
• Access to Global Investments
• Rand Hedged Assets
• Asset remains within clients estate
Client
Custodian
IZA Wealth Investment
Portfolio

23. Tax Wrap - Overview
• Investment fully liquid and flexible.
• Initial Capital Tax Free on
repatriation to South Africa.
• Gains taxed at source - £/$12%
• Access to Global investments.
• Rand Hedged Asset.
• Asset remains within client’s Estate.
Client
Tax Wrap Isle of Man
IZA Wealth Investment
Portfolio
Custodian

24. Offshore Pension - Overview
• Remove asset from clients name by
contributing asset to a pension
• Appoint beneficiaries on set up –
avoids need for Foreign Will, avoids
probate.
• Capital Fully accessible on Retirement
age (50).
• No tax on repatriation of Capital, CGT
rates apply to gains.
• Full asset value moves tax free to
pension beneficiaries on death.
• Can pour over existing offshore Trust
assets to pension without triggering
sale event.
• Low cost alternative to an offshore
Trust.
Member
IZA Wealth
Investment
Portfolio
Custodian
Master Pension
Trust - Guernsey
Advisor Iza
Wealth
Client

25. Portfolios

26. Iza Wealth managed portfolios
Why invest in less than 1% of the global markets locally when you can access more than 99% offshore?
As at 30 April 2019 MTD YTD 1 Year 3 Years* 5 Years*
IZA Global Stable Portfolio 1.33 8.21 6.31 9.57 9.57
Benchmark (Cautious) 0.70 4.10 2.14 3.85 3.45
IZA Global Balanced Fund 2.06 10.88 6.15 13.59 13.06
Benchmark (Flexible) 1.11 7.44 6.12 8.77 7.98
IZA Global High Growth Portfolio 2.90 13.39 11.96 19.14 18.38
Benchmark (MSCI ACWI) 3.30 13.50 10.61 16.19 13.14
Funds’ Performance Summary (GBP)
 Flexible and liquid portfolios.
 Diversified portfolios across global markets and asset classes.
Iza Wealth designs open architecture portfolios in line with clients risk
profile and mandate.
What are the
asterixis for by 3
Years and 5 Years?
No footnote

27. Ten golden rules of investment:
If you don’t fully understand it - don’t invest in it !
Don’t try time the market
Minimise Fees
Deal as infrequently as possible
Don’t over diversify
Never invest just to avoid tax
Never invest in poor quality companies
Buy shares in a business that can be run by an idiot
Don’t engage in greater fool theory
If you don’t like what's happening with your shares, switch off the screen!
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28. Questions?