The Bank of Ghana recently identified eight money transfer organizations (MTOs) that are operating in the country's remittances and forex markets without its approval. In response, the central bank has warned the public and regulated financial institutions against conducting business with these unapproved entities.
Unapproved MTOs Violate Foreign Exchange Act
The Bank of Ghana has identified the following eight MTOs as operating without its approval: Lemfi, Wise, Transfer Go, Xoom-A Paypal Service, Sendvalu, Boss Revolution, BTC-AZA Finance, and Supersonicz. According to the central bank's notice, each of these MTOs is in violation of Section 3.1 of the Foreign Exchange Act, 2006 (Act 723), which states that no person should engage in foreign exchange dealings without a license issued under this Act.
Additionally, Section 15.3 of the same law specifies that any movement of foreign exchange to and from Ghana must be conducted by individuals or entities with the necessary licenses. The Bank of Ghana has reminded approved MTOs to adhere strictly to the requirements of their licenses and conduct their foreign exchange flows only through their partner institutions.
Addressing Foreign Exchange Shortages
Ghana, like many African countries, has faced challenges related to foreign exchange shortages in its official market. These shortages have put pressure on the local currency's exchange rate against the U.S. dollar and contributed to inflation. In fact, the Ghanaian cedi was one of the world's worst-performing currencies in 2022.
To mitigate the impact of the parallel forex market on the economy, Ghanaian monetary authorities have implemented various measures. These measures include suspending the licenses of financial institutions found to be non-compliant with the law.
In its latest enforcement action, the Bank of Ghana announced that it has fined and suspended the forex license of Zeepay Ghana Limited from November 27, 2023, to December 8, 2023.
By cracking down on unapproved MTOs and taking action against non-compliant financial institutions, the Bank of Ghana aims to regulate the remittances and forex markets more effectively and ensure compliance with the Foreign Exchange Act.
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Frequently Asked Questions
How is gold taxed within a Roth IRA
Investment accounts are subject to tax based only on their current value and not the amount you originally paid. So if you invest $1,000 in a mutual fund or stock and then sell it later, any gains are subject to taxes.
However, if the money is deposited into a traditional IRA/401(k), the tax on the withdrawal of the money is not applicable. Taxes are only charged on capital gains or dividends earned, which only apply to investments longer than one calendar year.
These rules vary from one state to another. Maryland is an example of this. You must withdraw your funds within 60 calendar days of turning 59 1/2. Massachusetts allows you to delay withdrawals until April 1. New York has a maximum age limit of 70 1/2. To avoid any penalties, plan your retirement savings and take your distributions as early as possible.
What amount should I invest in my Roth IRA?
Roth IRAs are retirement accounts that allow you to withdraw your money tax-free. These accounts cannot be withdrawn until you turn 59 1/2. However, if you do decide to take out some of your contributions before then, there are specific rules you must follow. First, your principal (the deposit amount originally made) is not transferable. No matter how much money you contribute, you cannot take out more than was originally deposited to the account. If you take out more than the initial contribution, you must pay tax.
The second rule states that income taxes must be paid before you can withdraw earnings. When you withdraw, you will have to pay income tax. Let's suppose that you contribute $5,000 annually to your Roth IRA. Let's also assume that you make $10,000 per year from your Roth IRA contributions. The federal income tax on your earnings would amount to $3,500. This leaves you with $6,500 remaining. Since you're limited to taking out only what you initially contributed, that's all you could take out.
Therefore, even if you take $4,000 out of your earnings you still owe taxes on $1,500. You'd also lose half the earnings that you took out, as they would be subject to a second 50% tax (half of 40%). You only got back $4,000. Even though you were able to withdraw $7,000 from your Roth IRA,
There are two types of Roth IRAs: Traditional and Roth. Traditional IRAs allow you to deduct pretax contributions from your taxable income. You can withdraw your contributions plus interest from your traditional IRA when you retire. There is no limit on how much you can withdraw from a traditional IRA.
Roth IRAs do not allow you to deduct your contributions. After you have retired, the full amount of your contributions and accrued interest can be withdrawn. There is no minimum withdrawal amount, unlike traditional IRAs. Your contribution can be withdrawn at any age, not just when you reach 70 1/2.
How Do You Make a Withdrawal from a Precious Metal IRA?
First, determine if you would like to withdraw money directly from an IRA. After that, you need to decide if you want to withdraw funds from an IRA account. Next, make sure you have enough money in order for you pay any fees or penalties.
Consider opening a taxable brokerage instead of an IRA if it is possible to pay a penalty if your withdrawal is made before the deadline. If you decide to go with this option, you will need to take into account the taxes due on the amount you withdraw.
Next, you need to determine how much money is going to be taken out from your IRA. This calculation is dependent on several factors like your age when you take the money out, how long you have had the account, and whether or not your plan to continue contributing.
Once you know what percentage of your total savings you'd like to convert into cash, you'll need to determine which type of IRA you want to use. While traditional IRAs are tax-free, Roth IRAs can be withdrawn at any time after you reach 59 1/2. However, Roth IRAs will charge income taxes upfront and allow you to access your earnings later without additional taxes.
Finally, you'll need to open a brokerage account once these calculations are completed. Many brokers offer signup bonuses or other promotions to encourage people to open accounts. You can save money by opening an account with a debit card instead of a credit card to avoid paying unnecessary fees.
When it's time to make withdrawals from your precious-metal IRA, you'll need a place to keep your coins safe. Some storage facilities will take bullion bars while others require you only to purchase individual coins. Before choosing one, consider the pros and disadvantages of each.
For example, storing bullion bars requires less space because you aren't dealing with individual coins. However, you'll need to count every coin individually. You can track their value by keeping individual coins.
Some prefer to keep their money in a vault. Others prefer to store them in a safe deposit box. Regardless of the method you prefer, ensure that your bullion is safe so that you can continue to enjoy its benefits for many years.
What Should Your IRA Include in Precious Metals?
It's important to understand that precious metals aren't only for wealthy people. It doesn't matter how rich you are to invest in precious metals. In fact, there are many ways to make money from gold and silver investments without spending much money.
You might consider purchasing physical coins, such as bullion bars and rounds. Also, you could buy shares in companies producing precious metals. You might also want to use an IRA rollover program offered through your retirement plan provider.
No matter what your preference, precious metals will still be of benefit to you. Although they aren’t stocks, they offer the possibility for long-term gains.
Their prices are more volatile than traditional investments. So, if you decide to sell your investment down the road, you'll likely see more profit than you would with traditional investments.
Should You Buy or Sell Gold?
In times past, gold was considered a safe haven for investors in times of economic trouble. Many people are now turning their backs on traditional investments like stocks and bonds, and instead look to precious metals like Gold.
While gold prices have been rising in recent years they are still low relative to other commodities, such as silver and oil.
Experts think this could change quickly. Experts believe that gold prices could skyrocket in the face of another global financial crisis.
They also mention that gold is becoming more popular due to its perceived worth and potential return.
If you are considering investing in gold, here are some things that you need to keep in mind.
- The first thing to do is assess whether you actually need the money you're putting aside for retirement. It is possible to save for retirement while still investing your gold savings. That said, gold does provide an additional layer of protection when you reach retirement age.
- Second, make sure you understand what you're getting yourself into before you start buying gold.There are several different types of gold IRA accounts available. Each offer varying degrees of security and flexibility.
- Finally, remember that gold doesn't offer the same level of safety as a bank account. Losing your gold coins could result in you never being able to retrieve them.
So, if you're thinking about buying gold, make sure you do your research first. Protect your gold if you already have it.
Statistics
- Gold is considered a collectible, and profits from a sale are taxed at a maximum rate of 28 percent. (aarp.org)
- If you take distributions before hitting 59.5, you'll owe a 10% penalty on the amount withdrawn. (lendedu.com)
- Contribution limits$6,000 (49 and under) $7,000 (50 and up)$6,000 (49 and under) $7,000 (50 and up)$58,000 or 25% of your annual compensation (whichever is smaller) (lendedu.com)
- The price of gold jumped 131 percent from late 2007 to September 2011, when it hit a high of $1,921 an ounce, according to the World Gold Council. (aarp.org)
- If you accidentally make an improper transaction, the IRS will disallow it and count it as a withdrawal, so you would owe income tax on the item's value and, if you are younger than 59 ½, an additional 10% early withdrawal penalty. (forbes.com)
External Links
irs.gov
cftc.gov
finance.yahoo.com
law.cornell.edu
- 7 U.S. Code SS7 – Designation Boards of Trade as Contract Markets
- 26 U.S. Code SS 408 – Individual retirement funds
How To
Three ways to invest in gold for retirement
It is important to understand the role of gold in your retirement plan. You have many options for investing in gold if there is a 401K account at your workplace. You may also want to consider investing in gold outside of your workplace. If you have an IRA (Individual Retirement Account), a custodial account could be opened at Fidelity Investments. You may also want to purchase precious metals from a reputable dealer if you don’t already have them.
These are three easy rules to remember if you invest in gold.
- Buy Gold with Your Cash – Don't use credit cards or borrow money to fund your investments. Instead, deposit cash into your accounts. This will help you to protect yourself against inflation while also preserving your purchasing power.
- Physical Gold Coins You Should Buy – Physical gold coins should be purchased over a paper certificate. The reason is that it's much easier to sell physical gold coins than certificates. Also, there are no storage fees associated with physical gold coins.
- Diversify Your Portfolio. Never place all your eggs in the same basket. In other words, spread your wealth around by investing in different assets. This reduces risk and allows you to be more flexible during market volatility.
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By: Terence Zimwara
Title: Ghana's Central Bank Cracks Down on Unapproved Money Transfer Organizations
Sourced From: news.bitcoin.com/ghanas-central-bank-names-eight-money-transfer-companies-operating-without-its-approval/
Published Date: Thu, 23 Nov 2023 07:00:39 +0000
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