The Pilling & Co
AIM Portfolio Service
Under
current legislation bequests made to a deceased’s spouse or to recognised
charities escapes inheritance tax (IHT). Otherwise the first £325,000 of
assets bequeathed on death attracts no IHT and everything over this figure
attracts tax at the rate of 40%.
An exemption to this are shares in companies that qualify for Business
Property Relief (Business Assets). Companies that qualify for such relief
are those that are not listed on a recognised Stock Exchange. Most
importantly the AIM and OFEX (now called PLUS Quoted) markets are not
recognised stock exchanges for this purpose, although companies utilising
these platforms are quoted and may be traded. Business assets are:
There are some AIM and PLUS Quoted
companies that currently do not qualify for these reliefs, these include
companies dealing in property, investments and general financial instruments
(i.e. investment companies) and cash shells.
There are over 1,600 companies
listed on AIM representing over 30 countries of origin. This makes it possible
for us to create and manage a portfolio to take advantage of these far reaching
tax breaks.
We do have to point out that AIM
and PLUS Quoted securities are regarded as high risk and trading
liquidity cannot be guaranteed. Investors should only contemplate investing in
such equities if they can afford to lose any of the capital committed.
We believe the higher risk nature
of AIM and PLUS Quoted investing makes it essential to have a broad spread of
companies that have been researched and are regularly monitored. Over the past
several years we have put together a core universe of companies from which we
select for IHT mitigation portfolios. These companies are regularly appraised
and added to when appropriate opportunities arise.
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