1. Specialist Tax Portfolio Service
Welcome to Rathbones
Specialist Tax Portfolio Service
Presented by Ivan Teare, Investment Director
18 August 2017

2. Today’s session will Today’s session isn’t designed to
Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
Today’s session will
give basic inheritance tax facts and figures
introduce business relief as a planning strategy
Today’s session isn’t designed to
provide tax advice
provide financial advice

3. Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
Before we start

4. What is inheritance tax worth
Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
What is inheritance tax worth
Total receipts according to national statistics
2009/10 £2.396 billion
2016/17 £4.84 billion

5. Anticipated receipts from IHT?
Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
Anticipated receipts from IHT?
in the Chancellor’s spring budget forecast receipts from inheritance tax are set to reach £6.2 billion in 2021/22

6. What is driving the increase in values?
Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
What is driving the increase in values?
Source: Factset
The value of investments and the income from them may go down as well as up and you may not get back your original investment. Past performance should not be seen as an indication of future performance. Changes in rates of exchange between currencies may cause the value of investments to decrease or increase.

7. The nil rate band there is a threshold of £325,000
Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
The nil rate band
there is a threshold of £325,000
any unused threshold may be transferred to a surviving spouse or civil partner, increasing combined threshold up to £650,000
has been held at £325,000 since April 2009

8. The main residence nil rate band
Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
The main residence nil rate band
from 2017/18, an additional, transferable nil rate band of £100,000
this increases £25,000 per annum until 2020/21
then rises by CPI each year from 2020/21
this is complex and there are catches

9. What are exempted gifts?
Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
What are exempted gifts?
Each tax year, you can give away £3,000 worth of gifts known as your ‘annual exemption’ and can carry forward unused annual exemption for one year only.
In addition to the annual exemption other exempt gifts include:
wedding or civil ceremony gifts of up to £5,000 for a child, up to £2,500 for grandchild or great grandchild or up to £1,000 for a friend or another relative
normal gifts from surplus income
payments to help with another person’s living costs, such as an elderly relative or a child under 18
gifts to charities and political parties

10. Potentially exempt transfers
Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
Potentially exempt transfers
Gifting assets is a complex area and some gifts may be liable to inheritance tax
Years between gift and death
Tax paid
Less than 3     
40%
3 to 4
32%
4 to 5
24%
5 to 6
16%
6 to 7 8%
7 or more 0%
Source: HMRC

11. Allowances aside what options are available?
Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
Allowances aside what options are available?

12. Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
Business relief
business property relief was introduced as part of the 1976 Finance Act, enabling shares in family businesses to be transferred free of inheritance tax

13. The link to inheritance tax planning
Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
The link to inheritance tax planning
business property relief qualifying assets are exempt from inheritance tax where they have been held for a period of at least two years upon the death of the shareholder

14. Limited to business owners?
Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
Limited to business owners?
not necessarily
shareholdings in certain unquoted and Alternative Investment Market (AIM) quoted companies
not all trades qualify; mainly dealing in land or buildings or making or holding investments
a complex area requiring expertise

15. What is AIM? the alternative investment market launched in 1995
Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
What is AIM?
the alternative investment market
launched in 1995
at the end of July 2017, 964 constituents
Source: London Stock Exchange

16. Features of AIM investments
Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
Features of AIM investments
speed – qualifying assets can be removed from the estate for IHT purposes after two years
control – the investor retains ownership and access to their assets
simplicity – no complicated tax structures, age limitations, health checks or life cover
ISAs – from August 2013, AIM shares became ISA eligible
replacement relief – allows proceeds from qualifying investments to be reinvested into other qualifying investments without restarting the two year holding requirement
liquidity – being quoted on AIM generally means assets can be realised upon request, subject to market conditions

17. Increased risks of AIM investing
Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
Increased risks of AIM investing
Investment risk
heightened through smaller company investment
Diversification risk
up to 100% AIM quoted direct equities
Opportunity risk
can only invest when suitable opportunities arise
Liquidity risk
can be less liquid than blue chip stocks and companies can subsequently de-list from AIM
Qualifying risk
the company may cease to qualify and the tax reliefs granted may be revoked
Tax relief risk
those available may change or be removed entirely
Investor risk
personal circumstances may change the benefits received or the requirement for the invested funds
Holding period risk
if investments are not held for the relevant period tax relief may be revoked or not achieved

18. Rathbones Specialist Tax Portfolio Service
Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
Rathbones Specialist Tax Portfolio Service
all clients must be introduced by Financial Advisers
a diverse portfolio of AIM quoted smaller companies
an external firm of tax advisers are engaged for their opinion on qualifying status of investments
investment philosophy of good quality, established smaller companies
an experienced management team

19. Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
An AIM company example
Churchill China plc is a leading supplier of table top products to the worldwide hospitality and retail markets. Established in 1795, Churchill China plc is listed by the London Stock Exchange on the Alternative Investment Market (AIM)
Employing more than 400 staff in Stoke on Trent, Churchill manufactures high quality ceramic tableware for the hospitality industry. Working with many well known brands and designers Churchill supplies the mid market retailers with an extensive range of tableware and gifts.
Committed to manufacturing and service excellence Churchill continues to invest in its people, technology and systems.

20. Summary there are a range of IHT mitigation options
Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
Summary
there are a range of IHT mitigation options
an AIM portfolio is one
this is a complex planning area that requires specialist professional advice

21. Important information
Welcome to Rathbones | Specialist Tax Portfolio Service
18 August 2017
Appendix
Important information
The value of investments and the income from them may go down as well as up and you may not get back your original investment. Past performance should not be seen as an indication of future performance. Changes in rates of exchange between currencies may cause the value of investments to decrease or increase.
Information valid at date of presentation.
Tax regimes, bases and reliefs may change in the future.
Rathbone Brothers Plc is independently owned, is the sole shareholder in each of its subsidiary businesses and is listed on the London Stock Exchange.
Issued and approved by Rathbone Investment Management Limited, which is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered office: Port of Liverpool Building, Pier Head, Liverpool L3 1NW, Registered in England No
Rathbones is the trading name of Rathbone Investment Management Limited.
Rathbone Unit Trust Management Limited is authorised and regulated by the Financial Conduct Authority. Registered office: 8 Finsbury Circus, London EC2M 7AZ, Registered in England No
Trust, tax and company administration services are supplied by trust companies in the Rathbone Group. Provision of legal services is provided by Rathbone Trust Legal Services Limited (‘RTLS’), a wholly owned subsidiary of Rathbone Trust Company Limited (‘RTC’). RTLS is authorised and regulated by the Solicitors Regulation Authority under no The registered office of both RTC and RTLS is 8 Finsbury Circus, London EC2M 7AZ. RTC and RTLS are registered in England under company nos and respectively.
Rathbone Investment Management International Limited is the registered business name of Rathbone Investment Management International Limited which is regulated by the Jersey Financial Services Commission. Registered Office: 26 Esplanade, St Helier, Jersey JE1 2RB. Company Registration No
Rathbone Investment Management International Limited is not authorised or regulated by the Financial Conduct Authority or the Prudential Regulation Authority in the UK. Rathbone Investment Management International Limited is not subject to the provisions of the UK Financial Services and Markets Act 2000 and the Financial Services Act 2012; and, investors entering into investment agreements with Rathbone Investment Management International Limited will not have the protections afforded by that Act or the rules and regulations made under it, including the UK Financial Services Compensation Scheme. This document is not intended as an offer or solicitation for the purpose or sale of any financial instrument by Rathbone Investment Management International Limited.
No part of this document may be reproduced in any manner without prior permission.
© 2017 Rathbone Brothers Plc. All rights reserved.

22. Specialist Tax Portfolio Service
Ivan Teare BA (Hons)
Investment Director at Rathbones
Began investment career in 1996
Joined Rathbones in 2005
Responsible for Rathbones’ Specialist Tax portfolios.
I’d like to introduce to you Ivan Teare, Investment Director at Rathbones. Ivan began is investment career in 1996 & joined Rathbones in Ivan is responsible for Rathbones’ Specialist tax portfolios which incorporate AIM quoted Inheritance Tax & Enterprise Invesment Scheme strategies.

23. Disclaimer The opinions expressed herein are those of Rathbones
and are subject to change. This presentation has been developed with their current
understanding of the industry and it’s regulation.
The content of this presentation should not be considered to be advise and independent
financial advice should be sought before taking any action.
Prosperity Financial Advisors & Stockbrokers is a trading name of Prosperity Independent
Financial Advisors & Stockbrokers Ltd. Prosperity Independent Financial Advisors &
Stockbrokers Ltd are authorised and regulated by the Financial Conduct Authority (507580).