As the government’s IHT take continues to increase year on year, the importance of Business Relief (BR) as an estate planning method has certainly not diminished. The OTS’ second report in its review of IHT recognised the importance BR in supporting family-owned businesses, and growth investment. While it has recommended addressing some inconsistencies in the rules governing BR qualification, it has also suggested changes that would open more trades and structures to BR eligiblity.
This is a sector that offers advisers additional tools in their estate planning arsenal but it’s important to stay up to date with developments and create and leverage expertise to obtain the best client outcomes.
The Alternative Investment Market (AIM) has demonstrated increasing maturity over the past year – while still living up to its reputation as “the world’s leading growth market”. Despite a number of headwinds that have caused volatility, not to mention the ongoing uncertainty created by Brexit, AIM has shown resilience and the ability to bounce back from global economic turmoil to show its second largest ever market value.
This strength is clearly being welcomed by financial advisers, who have shown in our third AIM Industry Report that they still recognise the market as one with good growth potential for clients. Brexit has not dampened their willingness to recommend AIM, while for nearly three-quarters of advisers 2018’s volatility has not impacted their enthusiasm for the market.
This latest edition of our AIM Industry Report examines those advisers’ views in more detail, and takes a closer look at the underlying statistics in the market, including analysing the various tax-efficient offers available on AIM. It also gets under the hood of recent regulatory changes designed to polish AIM’s reputation.
With post-Brexit economic forecasts and an intensifying government concentration on IHT collection, it’s hard to foresee any dilution of IHT in its current format any time soon. In fact, IHT receipts are forecast to reach almost £6 billion in just three years.
Recommending an investment to mitigate IHT at a time of so much economic and political upheaval seems like a daunting task. The latest edition of our BR Industry Report suggests otherwise, with an adviser survey finding that less than 4% of advisers who recommend BR, view it as harder to recommend in the current Brexit turmoil. Almost all advisers also predicted their use of BR to increase or stay the same over the next two years, with the rest expecting it to stay the same.
AIM focused BR managers took a battering in Q4 2018 and the government is shouting from the rooftops about closing the tax gap amid increasing IHT investigations. It’s clearly not a time to go it alone. But, while there may be increased scrutiny of all estate planning, there is certainly plenty of scope for new opportunities for those with the relevant BR expertise. A need for tax-efficient vehicles to accept funds disallowed from pensions and indications of under-use of BR by lower value estates are good places to start.
The Enterprise Investment Scheme provided nearly £1.8bn in capital to growing businesses in 2016/17, and approximately 28,000 companies have received over £18bn in funding since the launch of EIS in 1993.
The latest edition of Intelligent Partnership’s EIS Industry Report examines the landscape after the rule changes to EIS. This includes how investment managers have reacted in terms of the investee companies they are focusing on; how the appetite for EIS has changed among advisers and investors; and a deep dive into the investee companies that the government wants investors to focus on.
At a time when the Treasury’s IHT take is higher than ever, we feel it is an apt time to give professionals, who may meet clients on a weekly or daily basis, with estate planning needs, a greater insight into the options available as well as the opportunities for their business in this area. Regulators and clients now expect a proactive and holistic approach to legal and financial challenges and there is plenty of overlap in synergies when it comes to trusts, cash flow modelling, investment advice and later life issues such as equity release or long-term care planning between lawyers, accountants and financial advisers. With their combined knowledge bases, but separate expertise, it makes sense for them to work together to identify and fulfil all of the complimentary needs of each other’s clients.
This Guide is designed a practical resource that will help professionals become more knowledgeable and confident about estate planning.
Peer to peer lending is a dynamic market that is much more mature than many give it credit for. It is fully regulated, home to significant institutional investment and provides excellent inflation-beating, fixed income diversification opportunities. But, it is a relatively new asset class with a range of platforms and operating models, not to mention regulations.
This guide is intended to help financial advisers and planners to get to grips with how P2P can fit into their service offering and what it can do for their clients.
With IHT receipts approaching the £5bn mark in 2016/17, estate planning tools have become a hot topic. Business Relief (BR) is one of the lesser known estate planning solutions, but its use is on the rise. In 2014, over £2bn was claimed in BR exemptions via BR.
Our latest BR report looks at the environment that surrounds this tax efficient vehicle, including how it is providing much needed patient capital to UK businesses, the significance of BR against the backdrop of an ageing population, the significance of the AIM market in BR, as well as the latest compliance considerations that advisers should be aware of.
EIS was one of the main targets of the 2017 Autumn budget. The resultant changes, and the responses to the government’s Patient Capital Review have solidified government support for the scheme, whilst making sure that EIS is focused on investment in legitimate risk capital.
HM Treasury has referred to the IFISA as a way to, “provide ISA holders with greater choice over how to invest and will support the crowdfunding sector to continue to grow as a source of alternative finance for businesses.” The inclusion of additional consumer protections which must be present in the P2P and debt based securities investments that are IFISA eligible can only be reassuring for potential investors. But there are a number of other considerations as well as the everyday practicalities. Our goal with this guide is to give advisers an understanding of these so that they build the confidence to make the best use of the opportunities that the IFISA presents for their clients.
Intelligent Partnership have published the second industry report focused on the AIM market. Part of their award winning Alternative Investment Report (AiR) series, the 88 page, CPD accredited report takes an in-depth look at AIM from advisers and financial planners’ point of view, with a particular focus on tax efficient investments.