Why a Bed and ISA transfer to Fundamental could be just the ticket
With ISA season 2024 upon us and people looking to do more with their money; a “Bed and ISA” could be just the ticket. We look at what it is and how it can help with Inheritance Tax (IHT) Planning.
A Bed and ISA transfer is a process in which a client moves their non-ISA investments into an ISA. The term “Bed” refers to the process of selling the investments and then using the proceeds from the sale to purchase equivalent investments within the ISA. This transfer enables clients to take advantage of the tax benefits provided by an ISA, such as tax-free income and capital gains. On top of this; when using a service such as Fundamental Asset Management’s AIM IHT portfolio service, the ISA can also be used to reduce IHT.
Fundamental Asset Management’s AIM IHT portfolio service is designed to deliver 100% IHT relief on the investment by purchasing Business Relief qualifying AIM shares on behalf of a client. For the client’s investment to qualify, the following is necessary:
1) qualifying shares must be held for at least two years and still be held on death;
and
2) the company must still qualify for Business Relief at the time of the investor’s death
Another advantage of a Bed and ISA transfer is that it can help investors simplify their investment portfolio. By consolidating their investments within an ISA, investors can reduce the number of accounts they need to manage and keep track of. This can save time and effort and make it easier to monitor the performance of their investments.
Overall, a Bed and ISA can be a useful tool for clients who want to take advantage of the tax benefits offered by an ISA while combining this with investing through an AIM IHT portfolio service, has additional IHT planning benefits.
ISA ACCOUNT DEADLINE FOR FUNDAMENTAL
Existing clients: 5th April.
New clients: 2nd April at the latest (assuming all information needed has been provided).
We spoke about Bed and ISA transfers in a past webinar which can be watched here.
To find out more about the benefits of AIM, please speak to our Business Development Manager, Jonathan Bramall, via email [email protected] or phone 01923 713 894.
