Bond Investment Advice

As explained in our investment advice section we have access to a wide range of solutions to help you achieve financial freedom.

Whilst you may well have heard of pensions and ISAs you may not be as familiar with investment bonds.

When we talk about investment bonds, we are referring to life assurance bonds. This can be complex but very useful for financial planning depending on your tax position they can help make best use of your available tax allowances and are extremely useful for inter-generational inheritance tax planning as essentially part of the plan can be assigned to other people at any point during the life of the plan. This flexibility makes them attractive in some situations as the tax treatment of your bond will depend on your individual circumstances, which will of course change, and tax rules which may of course change in the future.

So briefly what are bonds? Very technically they are single premium life assurance products. This means that your investments fall under insurance tax regulations which makes them very flexible. Much like a pension or ISA you pay an amount into your bond which is invested so the value can go up and down with movements in the market, you can add or withdraw money in a tax efficient way with careful planning.

Some benefits of using bonds are:

  • 5% of the original investment can be withdrawn from without an immediate tax liability (for 20 years cumulatively)
  • There is something called “top slicing”, which can help mitigate the impact of tax charges if a gain pushes you into a higher income tax bracket
  • Funds within the bond can be easily switched with no Capital Gains Tax
  • Bond “segments” can be assigned, which is not possible with other investments such as pensions and assets, which can help with tax planning for families

For investment advice on bonds you can contact us to arrange a free initial consultation with one of our expert independent advisers.

Meet Mark Evans, our expert in Investment Advice.

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