Page 46 - Phonebox Magazine December 2016
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Finance Matters
AIM stocks open up Inheritance Tax bene ts in ISAs
Ever since Personal Equity Plans were introduced in the 1986 budget, the tax e ciency of these and their successor the Individual Savings Account (ISA), have attracted billions of pounds in investments and seen individuals build up large portfolios, some valued in excess of £1m. Whilst these investments are very tax e cient during your life time, the one downside is that they have always formed part of your estate and, as such, there is the potential to see 40% tax being taken before your bene ciaries see the proceeds.
However, from 5th August 2013, you have been able to invest into AIM shares within an ISA. Shares on the AIM market are generally smaller companies and, therefore, involve a greater level of risk and can be harder to sell. The government opened up these shares to ISA investors in the hope of encouraging more investment into small growing companies, which in the long run will hopefully bene t the economy and create more jobs. In theory, investing in the early stages when a company is small also provides the opportunity for investors to make attractive returns.
However, the big bene t to many who have built up ISA portfolios,is that AIM shares qualify for Business Property Relief. Put simply, this means that after 2 years, the value of these shares is out of your estate. For those with substantial ISA portfolios this is a huge change and just 2 years after investing can see a sizeable reduction in their taxable estate.
Of course, you should not invest into AIM ISAs just for this Inheritance Tax bene t as there are greater risks involved than with a traditional Stocks and Shares ISA, but for those whose attitude to risk is in line with this type of investing the tax e ciency of ISAs is now a lot greater.
If you would like to discuss or review your own investments and estate planning then please call us. Initial meetings are without charge and we are happy to come to see you in the comfort of your own home. See our advert below.
This article does not constitute advice and should not be taken as a recommendation to undertake any course of action mentioned without consulting a relevant professional.
Our dedicated financial advisers will help you to:
• ensure you have a clear financial plan for the future
• provide protection and peace of mind for your family
• make the most of your hard earned savings and investments • save for your retirement
• minimise your personal tax liabilities
• protect your estate for your beneficiaries
For ongoing advice and support... speak to the experts! Speak to Advison now on 01908 239555.
Advison Ltd is an appointed representative of In Partnership the trading name of The On-Line Partnership Limited which is authorised and regulated by the Financial Conduct Authority. Registered (England) No. 5009271
46 Phonebox Magazine | December 2016
A6 Investment Ad 2015.indd 4 10/02/2015 16:26

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