IHT (Inheritance tax) Relief
Aim portfolios for Inheritance Tax (‘IHT’) Relief
This is a complex area, and you should take professional advice. The comments below are for information only, and are not a recommendation.
In his pre-budget report in autumn 2007 the Chancellor announced tht the IHT allowance of £300,000 per person (the nil rate band) is now transferrable between married couples and civil partners, so that it is now possible for a couple to shelter up to £600,000 from what used to be called death duty. In fact this was fairly commonly done already by writing a trust into your will, but that is no longer necessary.
Beyond £600,000, it is possible to arrange IHT relief through owning farms or family businesses, but also through ownership of certain shares traded on Aim which qualify for 100% IHT relief if held for at least two years. To spread the risk over a portfolio of such shares, some 20 UK asset management firms have set up ‘IHT portfolio funds’ which offer a range of investment strategies’.
For example (and not recommendation) see
http://www.rathbones.com/rat/services/inv-management/private-investors/efficiency/portfolio-services/ Rathbones IHT Portfolio service
http://www.gerrard.com/PrivateSVOverview.aspx Gerrard Aim Portfolio service
http://www.octopusinvestments.com/investor/products/iht/protected_its.php if your investment has fallen in value when you die, a built in life assurance will cover any loss
http://www.hmrc.gov.uk/cto/customerguide/page16.htm the tax man’s guide to business assets relief