The thing that makes tax efficient plans highly attractive is that they're not subject to income and capital gains taxes. This means your investments have a greater capacity to grow.
The most tax efficient investments usually involve much greater investment risk
so it is important to be clear about why you might choose these investments. You may wish to reduce your higher rate tax bill or you may be concerned with preserving your wealth for the benefit of the next generation.
Note: The value of an investment, and any income from it can fall as well as rise and you may not get back the full amount you invest.
Venture Capital Trust (VCT)
VCTs are very high risk Investments.
VCTs exist to support entrepreneurial British businesses, often innovative, smaller companies, with the overall aim of driving economic growth. VCTs are supported by the government and offer considerable tax incentives to investors including:
- Up to 30% income tax relief on the amount invested
- Tax free Dividends
- Tax free Capital Gains.
For some investors VCTs are a way to broaden your portfolio but it is very important to bear in mind that VCTs are intended as long term investments and the availability of the tax incentives do depend on your individual circumstances and furthermore they could change in the future.
JWA advisers have the expertise to advise on VCTs and help you make the choices that are appropriate to your circumstances. JWA works with expert partners who are major players in this type if investment and who have the necessary resources and experience in this specialist area.
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to request a chat with one of our advisers about your investments and tax planning.
Enterprise Investment Scheme
EIS is a tax efficient investment vehicle that can provide
- up to 30% income tax relief on the value of your investment
- up to 100% relief on inheritance tax – the investment is outside your estate for IHT purposes after you have held the investment for two years and provided you hold the shares at the time of your death. Other conditions apply.
EIS is a very high risk type of investment but is appropriate for some people depending on their individual financial circumstances and their attitude to investment risk.
EIS investors have access to a more diverse set of funds, usually in early stage businesses.
EIS investors choose this as part of Inheritance Tax Planning (IHT)
Note: The value of an investment, and any income from it can fall as well as rise and you may not get back the full amount you invest.
EIS carries the additional risks that legislation could change in the future, affecting the reliefs available.
JWA advisers have the expertise to advise on EIS and help you make the choices that are appropriate to your circumstances. JWA works with expert partners who are major players in this type of investment and who have the necessary resources and experience in this specialist area.
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to talk to one of our advisers about our Inheritance Tax Service.