The FSCA has published a notice that clarifies the costs that can be deducted from a collective investment scheme portfolio, apart from those provided for in section 93(1) of the Collective Investment Schemes Control Act (Cisca).
In June last year, the FSCA published Guidance Notice 2 of 2021 that set out how the industry should interpret section 93(1).
Section 93(2) of Cisca empowers the FSCA to determine amounts, other than those referred to in section 93(1), that a manager may deduct from a portfolio.
Members of the industry and service providers have since identified additional costs and fees that could not be interpreted for inclusion as deductible costs and asked the FSCA to determine that these costs be permissible deductions from a portfolio.
In terms of the notice published this month, the FSCA has decided that managers can deduct the following:
- Legal fees and costs incurred to protect the value of, or enforce the rights in, an asset held in a portfolio;
- Costs or fees payable to a delegated person for claiming and receipt of foreign taxes withheld and due to the portfolio (foreign tax reclaim costs); and
- Costs of a delegated person to recover value-added tax due to a portfolio.
The notice, “Determination of permissible deductions for collective investment scheme portfolios, 2022”, came into effect on 18 February.
