Consolidating investments – Colin and Kate


Colin and Kate had a portfolio of investment bonds held in a sole name that were providing their income in retirement.

The bonds were performing well and had provided growth as well as income. Unfortunately, this growth was leading to a potentially significant tax charge arising in the future, in region of £70,000 and growing, either upon the policy holder’s death or when the bonds matured.

What did we do?

We assigned the bonds to be jointly owned, in order to lower the chance of death causing a tax charge to be triggered. This would also allow Colin and Kate to withdraw money more tax-efficiently.

We then carefully surrendered the bonds in segments over a number of years, in order to avoid a tax charge arising.

We also made full use of the clients’ ISA and pension contributions over this time, as well as fully utilising their capital gains tax allowances to maximise their tax efficiency.

The results

Colin and Kate no longer have to worry about future tax charges building up. They also have a more tax-efficient portfolio and easier access to it.

The portfolio is now evenly split between them; should something happen to one of them, the other will have access to money until the estate has been sorted.

In addition, by finding a provider that allows families to link their investments together, we were able to bring their daughters’ investments into the same charging structure thereby securing very competitive charges for them all.

Please note

The value of your investment can go down as well as up and you may not get back the full amount you invested.

Levels, bases of and reliefs from taxation may be subject to change and their value depends on the individual circumstances of the investor.

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