Sanlam UK is launching an inheritance tax (IHT) service, which seeks to enable clients to mitigate IHT liabilities and generate long-term growth by investing in smaller companies.
By investing in a diversified portfolio of shares listed on the Alternative Investment Market (AIM), the service will provide exemption from IHT through Business Property Relief (BPR).
The diversified portfolio will be made up of 25 to 45 shares across a range of industries and “with solid earnings growth potential”. Investors will be able to hold the shares in an ISA or SIPP, and can add or withdraw money at any time. Each stock will go through an extensive screening process to try to ensure qualification for BPR.
Part of the London Stock Exchange and designed for smaller companies seeking expansion, the AIM has had over 3,000 firms listed since its inception in 1995 and raised over £60 billion. Whilst investing in smaller companies can offer attractive valuations, diversification and the potential for higher returns, it is often perceived as higher risk, said Sanlam.
The service bears an initial charge of 1.5 percent, plus an annual management fee of two percent plus VAT is levied on the portfolio.
“With the launch of this new service, Sanlam UK reinforces its commitment to providing the best wealth and inheritance management strategies and solutions possible to our clients,” said Charlie Parker, head of portfolio management at Sanlam UK.
“A forward-looking approach is vital when it comes to protecting and planning your family’s wealth for future generations. This IHT service offers clients a straightforward, effective and flexible way to accrue and pass on wealth.”
Sanlam UK, part of the South African based financial service group Sanlam Ltd, provides a range of services to over 10 million clients globally, including insurance, financial planning and investments, and controls over £13 billion in client assets.