All client accounts in the Common Fund are eligible to receive what is called “distributable income” in accordance with the Māori Trustee Act.
Here are answers to some commonly asked questions about distributable income.
What is distributable income?
Distributable income is the income received from all Common Fund investments less the management fees.
How is my share of distributable income calculated?
Distributable income is calculated monthly. Your share of the distributable income is calculated on the basis of how much money your Te Tumu Paeroa client account has on the last day of the calendar month as a proportion of the total amount of account holders’ funds held in the Common Fund.
Is this interest?
No, it is not interest. Distributable income is a share of the income received from the Common Fund investments, less the management fees.
How much is the management fee?
The base management fee is currently set at 0.75% of the market value of the Common Fund. This fee is in line with what other fund managers charge for managing similar investments. Te Tumu Paeroa may also charge a supplementary fee to recover expenses associated with managing the Common Fund which are not covered within the base fee.
How will I know how much distributable income I am entitled to?
If we have a current address for you, Te Tumu Paeroa will send you a statement that tells you how much distributable income you received, and the management fee for your account. It will also show you how much tax has been withheld and paid to IRD on your behalf. You should get this statement before the end of each May.
When will my distributable income be paid into my own bank account?
Te Tumu Paeroa makes payments from Te Tumu Paeroa accounts to clients’ own bank accounts when the balances meet certain minimum payment thresholds.
Please ensure you let us know if you change your bank account.