The Stellar AiM ISA Inheritance Tax (IHT) Service is discretionary managed, with the goal of supporting advisers to protect their clients’ legacies from the financial burden of inheritance tax.
Provided that the portfolio is held for a minimum of two years and at the time of death, our Stellar AiM ISA IHT Service ensures a simple way of retaining income tax and capital gains relief – while simultaneously navigating the often complex landscape of inheritance tax planning.
As part of this service, capital is invested in a diversified portfolio of approximately 40 companies that are quoted on the Alternative Investment Market (AiM) of the London Stock Exchange. The government offers generous tax breaks to encourage investors to save, and one of the most popular ways is through an Individual Savings Account (‘ISA’) – with the goal of providing investors with a blend of capital preservation and growth.
Investing in Inheritance Tax Services carries risks and is not suitable for everyone,
click here for more information on the Risks of Investing.
Key Benefits
ISAs are a great planning tool, and careful investment management means that clients can accumulate substantial tax-free capital within their portfolio.
Unfortunately, ISAs themselves are not exempt from inheritance tax – potentially leaving clients legacies at risks. However, the good news is that there are certain types of investment that can be held in an ISA, which provide full relief from inheritance tax – as well as complete freedom on capital gains and income tax across all capital growth.
Since 2013, AiM listed companies have also qualified to be included in Individual Savings Accounts (ISAs) – providing shelter from Inheritance Tax, as well as income tax and capital gains tax, to effectively encourage longer term investment.
Investing in our Inheritance Tax Services carries risks and is not suitable for everyone. Tax reliefs are subject to change and dependant upon personal circumstance. There is no guarantee that an investor will receive a full return. Please find further details of the risks here.
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Introduction to AiM
Watch our video below for a brief explanation of the Alternative Investment Market (AiM).
Click on the following links to access our useful resources and wrap platforms.
Reasons to Choose Stellar AiM ISA IHT Service
Tax efficiency
Relief from IHT after two years – without income or capital gains tax.
Diversified
The portfolio typically comprises 40 AiM listed companies.
Control
Retain ownership of investments, for full control.
Heritage
Long term track record.
Transparent fees
Our fees are competitive and completely transparent.
Choice
Available within GIA or ISA accounts and via wrap platforms.
Reducing exposure
No more than 5% exposure to each individual company.
Our Investment Strategy
- The Stellar AiM ISA IHT Service works by either transferring existing ISAs or investing capital directly.
- Transferring existing ISA investments is an easy and simple way to improve tax efficiency, as clients can retain income and capital tax relief – while also benefitting from IHT relief.
- AiM shares, when held in an ISA, benefit from inheritance tax after 2 years – plus the income tax and capital gains tax benefits from the ISA wrapper.
- Any capital growth is not subjected to capital gains tax – although the value of investments and cash held in ISAs are usually counted as part of a taxable estate. This means that should the investor die with intent to pass on the ISA assets to their family, this investment may be subject to inheritance tax at 40%.
- Including approximately 40 AiM quoted companies – all of which qualify for Business Relief – the Stellar AiM ISA IHT Service aims to provide a blend of capital preservation and growth. To learn more about AiM and investing in our Stellar AiM Inheritance Tax Service, click here.
Key Attributes of the Portfolio
Important Information
Risks
There are never any guarantees in the world of investment, so it’s essential that advisers make their clients aware of the risks. Our Inheritance Tax Services are not suitable for everyone, so here’s a summary of what an investor needs to know before getting involved – alternatively, click here for more information.
- The value of a portfolio, or any income derived from it, can fluctuate.
There is no guarantee that the full value of an investment will be returned, or that sufficient investments in qualifying business activities will be made within the expected timetable, or at all. - Qualifying business activities are not certain.
Qualifying business activities may subsequently cease to qualify for Business Relief. In such cases, Business Relief could be lost or delayed. - Tax reliefs are not guaranteed
The rate of tax, tax benefits and tax allowances are subject to change and are also dependant on personal circumstance. Plus, any changes to what constitutes a qualifying business activity may have a material adverse effect on the value of the business, or Stellar’s potential to achieve the objectives of the service. - Conflicts of interest
The interests of one group of investors may not coincide with another, or an interest of Stellar. In the event of a conflict, Stellar’s investment committee will work to ensure it is resolved fairly and in lie with our conflict policy. - Investments are long-term and high risk.
Interests in the AiM companies are not liquid so although an investor can request a withdrawal from their portfolio, there may be a delay. This means that they may be unable to sell immediately, or will potentially fail to receive the best price. AiM companies are also significantly more volatile than larger companies on LSE. - Past performance is no indicator of future success.
Fees and Charges
| Initial Subscription Fee | Nil |
| Dealing Fee | 0.25% |
| Management Fee | 1% (plus VAT) per annum |
| Administration Fee | 0.225% (plus VAT) per annum |
Next Steps
To gain a full insight into our Stellar AiM ISA IHT Service, explore the following resources and wrap platforms:
- Document Downloads – featuring brochures, application forms and more
- Platform Services
For more information, complete the form for further insight into our Stellar AiM ISA IHT Service.
Investing in Inheritance Tax Services carries risks and is not suitable for everyone, read more.
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Frequently Asked Questions on Stellar AiM ISA IHT Service
Can you invest into AiM on Platforms?
Yes, there is a limited number of AIM Inheritance Tax portfolio providers available on Platform. Both the Stellar AiM IHT Service and the Stellar AiM ISA IHT Service is, for example, available on the abrdn, M&G Wealth and Transact platforms.
Advisers can potentially access the investment returns of investing in AiM, together with considerable IHT benefits – if accessed through a client’s general investment account or through an ISA.
What are the benefits of investing on AiM?
There are a number of benefits to clients when investing on the Alternative Investment Market (AiM). Firstly, shares on AiM qualify for Business Relief (BR), which offers 100% relief from Inheritance Tax after just two years – as opposed to seven years when placed in gifts and trusts.
Secondly, there are fewer regulatory requirements than listing on other exchanges. There is more red tape associated with other exchanges, which the Alternative Investment Market just simply doesn’t require. There are also no restrictions on market capitalisation, and financial reporting is more flexible – with no liquid asset tests and or a requirement for extensive trading history.
Thirdly, in 2013, AiM listed companies were allowed to be included in Individual Savings Accounts (ISAs). This thereby encouraged longer term investment by providing shelter from Inheritance Tax – as well as income tax and capital gains tax.
What is Business Relief (BR)?
Business Relief (BR), formerly known as Business Property Relief (BPR), was introduced in 1976 to allow a business owner to pass on their business to family members, without incurring inheritance tax. Our Inheritance Tax Services seek to operate within this robust legislation.
BR is becoming increasingly popular to more traditional inheritance tax planning strategies. In many cases, it takes seven years before the assets that your clients pass on are entirely exempt from inheritance tax, and this usually involves a transfer of those assets during their lifetime.
For more information, read our guide to Business Relief.
Platform Services
The Stellar AiM ISA IHT Service is available directly or via the following major wrap platforms – providing an alternate way to invest.
Take a look at our wide range of services
Stellar AiM IHT Service
A discretionary managed portfolio that mitigates risk through a diversified selection of 40 AiM stocks. This service is available for advised clients, on many of the UK’s largest wrap platforms.
Stellar Bespoke IHT Service
Designed for sophisticated investors who prefer a tailored discretionary investment approach to improve tax-efficiency.
Stellar Business IHT Service
A discretionary managed service which provides numerous succession planning and tax efficiency options for business owners – either following the sale of a company, or to invest excess company capital to maintain tax efficiency.
Stellar Growth IHT Service
This discretionary managed service involves the creation of a privately owned limited company for each investor, to access a portfolio of asset-backed Investment Sectors – targeting 5% growth per annum.
Stellar ITS
A discretionary managed service designed for investors who wish to leave a legacy that is free from inheritance tax.