ADVERT ISING FEATURE


The Charles Stanley Inheritance Tax Portfolio Service is designed to provide one of the quickest and easiest means of reducing a potential Inheritance Tax (IHT) liability.


Mark Henderson FCSI


Senior Investment Manager, Charles Stanley


Charles Stanley has a dedicated and experienced IHT team that has been offering this service since 2004. The team seeks to adopt a strict investment process by


60.3% 24.2% 23.5%


Portfolio and Benchmark Performance 12/07/12* to 31/12/13 Charles Stanley IHT Service FTSE All Share Index FTSE AIM Index


* Portfolio inception


his is achieved by investing in a


discretionary portfolio of qualifying companies listed on the Alternative Investment Market (AIM)


that qualify for Business Property Relief (BPR) and gain exemption from Inheritance Tax after a two- year holding period. Please note that due to its nature this service should be classified as high risk as the portfolio is invested in UK smaller companies.


focusing on proven, profitable, cash-generative businesses with long-established track records. In order to demonstrate


performance a model portfolio was established on 12 July 2012 and returns are measured on a quarterly basis against the FTSE All Share and FTSE AIM indices.


Capital-only returns are calculated at mid-prices and gross of 1.25% + VAT annual management fee and


Source: Charles Stanley and Bloomberg


1% dealing charge. The indicative yield is 1.9% (income can be paid away to your bank if required). The portfolio currently consists of 26 holdings with, on average, a trading history in excess of 60 years, market capitalisation of £200 million and pre-tax profit of more than £12 million. The dividend yield is 1.9%, two-thirds of the holdings have net cash


and one-third of the holdings were previously quoted on the Official List, highlighting the maturity of the underlying investments and conservative investment approach.


A change in the law last year means that investors are now able to purchase AIM shares via their ISA which will be free from Capital Gains Tax, Income Tax and Inheritance Tax, making AIM one of the most tax- advantageous markets in the world.


If you would like further information please contact your local Charles Stanley Stockbroker Mark Henderson FCSI by telephone on 01892 557115 or by email mark.henderson@charles-stanley.co.uk in the first instance.


Risk Warnings


Investments in certain securities, including shares in smaller companies, companies in specialist sectors, and/or in unquoted companies, will normally involve greater risk or above average price movements (volatility) than investments in larger, more established companies. The markets in such companies can suffer from partial or total illiquidity, which can make it difficult, or impossible, to dispose of an investment.


For quoted investments the difference between the Bid and the Offer price will often be greater, so that if an investor has to sell a holding immediately after purchase the proceeds may be less than the initial amount invested. AIM quoted shares tend to have market quotes in relatively small lots of shares, so selling large quantities in the market may achieve a lower price than the market quote.


Many smaller companies have a small management team and


as such the loss of any one individual may have a significant effect on their performance. In a similar vein these companies are likely to have a limited product range and tight cash constraints and tend to be vulnerable to sudden changes in market conditions.


The rules for issuers whose shares are quoted on AIM are less demanding than those for the Official List of the London Stock Exchange; as such the investment risks are higher. For unquoted companies the risks are much higher than for quoted companies; it may be difficult or impossible to sell such shares, or to assess their value or the level of risk involved.


It should be noted that the benefits of the Inheritance Tax Portfolio Service are premised on current tax rules continuing for the duration of an investor’s portfolio. The rules on tax or their interpretation, as with the rates of tax applicable,


may alter. The details and examples in this document are a simplified summary of the relevant tax rules. Potential investors are recommended to consult a professional tax adviser on all tax matters.


Past performance is not indicative of future performance. The value of investments may fall as well as rise and the income from them may fluctuate and is not guaranteed. Investors may not recover the amount invested.


Nothing in this material constitutes investment advice, nor is it a substitute for investment advice, which should be obtained from an authorised investment professional, and any investment decision the recipient makes should be based on an evaluation of that recipient’s financial circumstances, investment objectives, risk tolerance, and liquidity and other needs.


Charles Stanley & Co. Limited is registered in England No. 1903304. Registered office 25 Luke St, London, EC2A 4AR. Authorised and regulated by the Financial Conduct Authority. Member of the London Stock Exchange since 1852.


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