Foresight Group LLP (Foresight), one of the UK’s most experienced managers of tax-efficient investments, has launched a brand new inheritance tax (IHT) solution called The Foresight Accelerated Inheritance Tax Solution (Foresight Accelerated ITS). It combines Business Property Relief (BPR) with a group insurance policy to offer investors a solution that provides immediate protection from IHT for beneficiaries while maintaining access and control over their invested assets.
- Combining Business Property Relief with a two year insurance policy, the product offers a swift and simple solution to IHT
- Investors maintain complete control over their estate – control which is often forfeited when gifting or holding assets in Trust
- Inheritance tax receipts for 2015/16 were the biggest ever recorded at £4.6bn with the figure set to continue rising in coming years
To view or print this announcement from a pdf click here
Typically, it takes two years for shares to qualify for BPR. During this period, if the shareholder dies, their estate would continue to be liable for IHT on the value of the investment. However, the Foresight Accelerated ITS is specifically designed for those who want their assets to have immediate protection from IHT and the peace of mind that comes with this. The product automatically includes an insurance policy with a Lloyds of London syndicate which covers the two-year gap between the purchase of a qualifying investment and the availability of BPR.
If an investor dies during the first two years, with Foresight Accelerated ITS, the proceeds of the insurance policy will pay out 40% of the investment to the named beneficiary or beneficiaries, which can be used to offset their IHT liability. After the two year qualifying period has elapsed, the shares should qualify for BPR, at which point no IHT would be due on their value, subject to the investor continuing to hold the shares at death. Therefore, once this initial two-year period is over, the insurance cover will automatically cease.
The launch comes as more people are becoming liable to inheritance tax. In 2015/16, HMRC receipts for IHT were the highest ever recorded; generating £4.6bn in revenues, with the consensus being that this amount will grow still bigger in following years.
Hugi Clarke, Director at Foresight said: "Inheritance Tax is widely seen as the most unfair tax of all – it can be galling to think that after a lifetime of paying tax building up your estate, your beneficiaries may have to pay another raft of tax when you pass it on. And the products that are already available to mitigate IHT often come with a sting in the tail. For example gifts and trusts can take several years to be fully effective and can mean giving up access to, and control of, assets.
"This combination of insurance cover and BPR provided by the Foresight Accelerated ITS gives peace of mind for investors, offering an immediate solution to their IHT problem as soon as shares are purchased. Anyone with a single estate valued at £325,000, or a joint estate of £650,000 really should be looking to mitigate their IHT risks, as should all of those who are in real danger of house-price increases and inflation pushing them into these brackets in coming years. The Treasury is taking more and more from IHT – people need to plan in advance to protect the assets they have worked so hard to build during their lifetime.”
Foresight is an experienced infrastructure and private equity investment manager, managing tax efficient investments for more than 15,000 private investors. The company launched its original IHT solution (Foresight ITS) in 2012 and already has in excess of £100 million of BPR assets under management helping hundreds of investors with their estate planning.
Foresight Accelerated ITS, like its sister fund, Foresight ITS, will target infrastructure assets and asset-backed investments, which are ideally suited to deliver the capital preservation that investors want.
Citigate Dewe Rogerson
DD: +44 20 7282 2806
Notes to Editors
About Business Property Relief (BPR)
BPR was introduced in 1976 and is a tax relief provided by the UK Government as an incentive for investing in certain types of trading businesses. It is available on businesses, on an interest in a business or a partnership, on unquoted shares and on land, buildings, plant and machinery when utilised in a qualifying trading business.
About Foresight Group LLP ("Foresight”)
Foresight Group is a leading independent infrastructure and private equity investment manager which has been managing investment funds on behalf of institutions and retail clients for more than 30 years.
Foresight has some £1.9 billion of assets under management across a number of funds, including Listed Vehicles, Limited Partnerships, Business Property Relief (BPR), Enterprise Investment Schemes (EISs) and Venture Capital Trusts (VCTs).