Standard Life helps individuals protect investments from IHT

Standard Life has widened its estate planning proposition by increasing the investment options available within its Gift Plan.

For the first time, it is now possible to put mutual fund investments into the trust wrappers held within Standard Life's Gift Plan.

Until now the majority of life office trusts, including Standard Life's, only permitted onshore and offshore bonds to be held in a trust wrapper. The expansion of the Gift Plan will enable individuals to save monthly or on a one-off basis into a unit trust or OEIC and benefit from any growth in the value of the funds being outside the individual's estate for IHT purposes. The capital value of the gift falls outside the individual's estate after 7 years.

Customers can take full advantage of multi-investment wrapper and multi-trust planning when looking to:

make use of their annual IHT exemptions;
earmark and set aside funds for the next generations;
make regular investments (mutual funds) and / or lump sum increments (bonds).

Commenting on the launch, Julie Hutchison, Head of Estate Planning at Standard Life said: "Life offices are moving away from the old model of "trust + bond" as the single flavour offering and Standard Life's estate planning proposition is helping to drive this development. This launch marks a big step forward from the traditional life office approach of only linking an investment bond with trust planning. The expansion of the investment choice within our Gift Plan into collectives will offer much greater flexibility to individuals than ever before."

The Gift Plan now allows an individual to choose from a comprehensive range of trusts (absolute, discretionary and flexible) as well as take advantage of the varying investment options offered through the onshore bond, offshore bond and mutual funds. The mutual fund option is likely to appeal to the high net worth end of the market. It should be noted that being an income-producing asset, it will generate the need for a tax return to be submitted to HM Revenue & Customs.