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RaboDirect
 

An investment with more than tax benefits

The Term Advantage Fund (TAF) offers you a pre-tax return similar to a traditional term deposit of a similar term. The advantage is that this is has been structured as a Portfolio Investment Entity (PIE), which means it delivers tax benefits for 30% and 33% tax payers^. 
You can also feel good knowing your savings are helping to grow local agri-business.

A choice of terms

Choose from 3, 6 or 12 month terms

Tax capped at 28% 

Great benefits for 30% & 33% tax payers^

Pay tax annually 

Or when the investment matures

Low minimum investment 

Invest with only $1,000

Pay tax annually or on investment maturity

Another benefit of investing in this fund is that you pay tax at the end of the tax year, or when the investment matures (whichever happens first). 

This is an advantage over traditional deposit products where tax on interest is deducted monthly. 

Looking for an on call rate?

The Cash Advantage Fund (CAF) offers you a pre-tax return similar to a traditional call savings account. The benefit is that it has been structured as a Portfolio Investment Entity (PIE), which means it delivers tax benefits for 30% and 33% tax payers^.

See Cash Advantage Fund

Term Advantage Fund interest rates

Terms Standard interest rate* (p.a.) Effective return at 30% (p.a.) Effective return at 33% (p.a.)
3 months 3.35%
3.45%
3.60%
6 months 3.35%
3.45%
3.60%
1 year 3.40%
3.50%
3.65%

Early withdrawal fees may apply. Refer to the TAF Investment Statement for more information.
* Returns paid at maturity and/or annually. Investments with terms covering 31 March will pay income earned up to that date, minus applicable tax, into your RaboSaver. Your 'accrued income' figure will then be reset to zero, and the income subsequently earned from 1 April up to the date of maturity will be paid, again minus applicable tax, into your RaboSaver on the maturity date. Investments with terms which don't cover 31 March will pay the accrued returns, minus the applicable tax, on maturity into your RaboSaver.
^ The product disclosure statement for the Term Advantage Fund explains the PIE tax implications.

Compare our rates

Compare our rates against other banks

Frequently Asked Questions

What is the Term Advantage Fund?

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The Term Advantage Fund (TAF) is a managed fund (a pooled investment with many investors). The TAF is specifically designed to provide you with a pre-tax return similar to a traditional term deposit of a similar term. It only invests in deposits with the New Zealand branch of Rabobank Nederland. 

The TAF is also a Portfolio Investment Entity (PIE) which means tax is capped at 28%. The PIE tax regime is designed to encourage people to engage in long-term saving and investing, with a primary focus on managed funds; using the favourable tax rules as the incentive. 


What is the TAF 'Effective rate'?

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The effective rate allows you to compare the return from the Term Advantage Fund with a traditional term deposit where interest is taxed at a standard Resident Withholding Tax rate (up to 33%). 

Although the interest rate for the Term Advantage Fund and the term deposit may be the same, if you are a 30% or 33% tax payer you will earn more in the Term Advantage Fund as the tax is capped at 28%.

For example:
  • A 1 year term deposit earning 3.55% p.a. and taxed at 33% will have an effective (gross) interest rate of 3.55%. 
  • A 1 year Term Advantage Fund investment earning 3.55% p.a. and taxed at 28% will have an effective (gross) interest rate of 3.81% (for a 33% tax payer).

How do I invest in the Term Advantage Fund?

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New to RaboDirect

Click here to complete an online application form for our RaboSaver account. Once this is up and running, you will be able to invest in the Term Advantage Fund online. Here's a few things you will need:

  • Your IRD number
  • Your NZ driver licence and passport details (if you have them)
  • Your vehicle licence plate (if you own one)
  • An account number for another NZ bank account you hold 
We use the passport and licence information to electronically identify you, however if this isn’t successful we may need you to post us some documents. 
After completing the online application:
  • Submit any documentation listed on the checklist
  • Make an initial deposit to activate the account
We will then send your Welcome Pack which will have everything you need to log in and start investing in the Term Advantage Fund. 

Existing Customers

You can set up a Term Advantage Fund online. 

  1. Log in to your account and click 'PIE Funds'
  2. Click 'Term Advantage Fund' then 'Buy New Term Advantage Fund'
  3. Enter the investment details, e.g. amount and term
  4. Read and accept the investment statement
  5. Confirm the investment with your Digipass 
Note: The funds will need to be available in one of your RaboDirect savings accounts. 

Orders placed before 12.30pm on a business day will be completed that afternoon. 


Can I break my Term Advantage Fund?

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We may, at our discretion, allow you to break an investment in the Term Advantage Fund.

Call us on 0800 22 44 33 or send a secure message with details of the investment you wish to break. To send a secure message, log into RaboDirect and click 'My Rabo' then 'Create new message'.

We will then contact you to advise if the investment can be broken and if a fee will apply.

If we have approved your request to break, and provided you with a break quote, confirmation from you to proceed must be received by 12.00pm on a business day to ensure it is broken that day.

How do AMP Capital Investors fit into the picture?

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There are various parties involved with the TAF, each with specific roles.
  • Manager (AMP Investment Management (NZ) Limited) - Licensed entity responsible for the management and operation of the fund.
  • Investment Manager (AMP Capital Investors (New Zealand) Limited) - Responsible for developing the investment strategy, setting the investment objectives and making the ongoing decisions relating to the asset allocation of the fund.
  • Promoters (AMP Capital Investors (New Zealand) Limited) - The sponsor and/or distributor of the fund.
  • Trustee/Custodian (The New Zealand Guardian Trust Company Limited) - Legal entity fulfilling the fiduciary and prudential responsibilities for unit holders as outlined by the trust Deed and is responsible for the safe custody of the assets of the fund.
  • Administrator (BNP Paribas Fund Services Australasia Pty Ltd - operating as BNP Paribas Security Services) - Appointed by the Investment Manager / Manager and is responsible for the administration on behalf of unit holders / investors.
  • Registrar (Appello Services Limited) – Responsible for providing registry services for the fund.
See the Product Disclosure Statement for more information.

When is interest and tax paid?

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Interest is paid (and PIE tax deducted):
  • on the maturity of the term, AND
  • additionally, if you are invested in the TAF at the end of the tax year (31 March), we will pay out any accrued interest at that point. We are required to do this for all PIE funds so that we may calculate and pay any applicable PIE tax at that stage.

How to open a Term Advantage Fund

Opening a Term Advantage Fund is easy and can be completed online. New RaboDirect customers can follow the three simple steps below.

1. Apply for a RaboSaver account


First you'll need to apply for a RaboSaver account using our online application form. Be sure to have your ID documents handy. Click here to learn more about becoming a RaboDirect customer.

2. Receive your welcome pack


Once you have applied and verified your nominated account, we will courier a Welcome Pack to your address. You’ll be able to log in to your new account using the details in the welcome pack.

3. Log in and open a TAF


Log in to your new RaboDirect account and scroll down and select 'Buy Term Advantage Fund'.

Follow the steps and start investing!

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