Scottish Life International launches discounted gift trust
Friday, 20 April 2007
Scottish Life International has added a 'discounted gift trust' to its range of draft trusts for use in inheritance tax planning strategies.
The Scottish Life International Discounted Gift Plan combines a sophisticated draft trust with a life assurance bond issued by Scottish Life International.
The Scottish Life International Discounted Gift Plan is designed for individuals who wish to make inheritance tax-effective gifts of capital, but need a substitute for the income previously generated from that capital. In return for the investment, the investor receives a pre-planned stream of payments for life.
The individual who establishes the Scottish Life International Discounted Gift Plan is the settlor and they can set up the trust with either cash or an existing Scottish Life International bond. The terms of the trust are such that on dates specified in advance by the settlor, payment of a specified amount is made by the trustees to the settlor.
The Scottish Life International Discounted Gift Plan is structured so that the 'notorious' inheritance tax 'gift with reservation' provisions do not apply.
Alan Blackburne, Scottish Life International's Head of UK Sales commented:
"The Scottish Life International Discounted Gift Plan is a valuable tool for IFAs who wish to develop inheritance tax planning strategies with clients.
"Although transfers to the trust trigger an inheritance tax chargeable lifetime transfer, the value of the transfer is not the amount invested but a discounted amount reflecting the value of the future stream of payments from the trustees to the investor. The basis on which the discount is calculated has been agreed with HM Revenue & Customs – a fact which should give confidence to users of the plan."
– ENDS –
for further information please contact:
pressoffice@sli.co.im / 0131 456 6031 or
Scottish Life International
Alan Blackburne
Head of UK Sales
Tel: 01296 660 980
Mobile: 07919 171 604
alan.blackburne@sli.co.im
Gerry Brown
Technical Manager
Tel: 0131 456 6024
Mobile: 07919 171 587
gerry.brown@sli.co.im
editors notes:
Scottish Life International was launched in 1996 and is now part of the Royal London Group. The company has grown rapidly in size and now has funds under management in excess of £730 million from investors in the UK and around the world (as at 31 December 2006). Scottish Life International is based in the Isle of Man, where it is supervised by the Isle of Man Government Insurance and Pensions Authority.
Scottish Life International is a member of the Association of International Life Offices (AILO) and sponsors IFA Promotion (IFAP), which supports the need for independent financial advice.
Holders of policies issued by Scottish Life International Insurance Company Limited, based in the Isle of Man, will not be protected by the UK Financial Services Compensation Scheme if the company becomes unable to meet its liabilities to them. Policyholders will however be protected by the Isle of Man Life Assurance (Compensation of Policyholders) Regulations 1991.
Royal London Group is a specialist financial service provider. Its businesses focus
on those sectors of the market which value premium propositions, operating through
a number of brands:
• Scottish Life - UK pensions market
• Bright Grey - UK protection market
• Scottish Life International - offshore investment markets
• RLAM - fund management
• RLAS - life and pensions administration
Royal London is one of the stronger life and pension companies in the UK, and has a particularly strong track record for with profits performance.
Royal London is the largest mutual life and pensions company in the UK with Group funds under management of £30.8 billion. Group businesses serve over three million customers and employ 2, 640 people. (Figures quoted are as at 31 December 2006.)
The draft deed is available as a specimen only. Details are based on Scottish Life
International's current interpretation of UK taxation law and practice which may be
affected by future changes in UK legislation. Specialist tax and legal advice should be taken before any tax strategy is implemented.
Issued by Scottish Life International Investment Group Limited, a Royal London company which is authorised and regulated by the Financial Services Authority. Registered in Scotland number 166387. Registered office: 19 St Andrew Square, Edinburgh EH2 1YE.
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