The Collective Bond is a portfolio bond specifically designed to be tax efficient for clients living abroad, giving them freedom to invest in external collective investment funds, unit trusts or bank deposits. It enables your clients to build on their wealth with a wide range of funds to help them reach their financial goals.
All the investments available through the Collective Bond are within the ‘personal portfolio bond’ (PPB) legislation and are compliant with UK income tax legislation, meaning it could be the right solution for clients who may return to the UK in future. And time apportionment relief can be applied if the client does move back to the UK, meaning any UK tax will be reduced proportionately for time spent as non-UK resident. See our Techcellence video on time apportionment and top slicing for more information.
This product is not available in all EU jurisdictions; please contact your Old Mutual International sales consultant for more information.
Choice and flexibility
The Collective Bond offers a wide range of UK tax-compliant investments, allowing your clients to spread their capital across a selection of assets, giving excellent potential for growth. It enables investors to:
- invest in a wide range of funds across major asset classes by wrapping their existing portfolio, or building a new one, within a bond
- start the bond with an initial investment of only €37,500 (or currency equivalent) and add extra amounts of a minimum of €1,825 (or currency equivalent) whenever they choose
- pay in, withdraw and invest in multiple major currencies (subject to our acceptance)
- transfer in or consolidate existing investments (where acceptable) so they are all held in one easy to manage portfolio
- allocate segments of the bond, tax efficiently, to other parties who may have a lower tax band, such as their children, who can then cash it in or use it as part of their own investment portfolio
- utilise top slicing relief if applicable to help further reduce tax liability.
- view performance, access valuations and reports quickly and conveniently through our online service, Wealth Interactive, which can save time, effort and costs
- appoint third party fund managers for additional oversight and control
- adapt and move their investment with them as circumstances change, although there may be restrictions in certain countries so financial advice is crucial to help maintain tax efficiencies
- use a trust (where appropriate) to help safeguard their investment. Visit our Trustability hub for more information on how you can use a trust as a financial planning tool
- flexibly access their capital free of charge, subject to minimum withdrawal amounts and a minimum surrender value
- postpone taxable events by timing withdrawals as in most countries the gains are not taxed until they are realised
- benefit from significant savings on initial fund charges, thanks to our negotiating strength.
Life and redemption options
The Collective Investment Bond (CIB) is a whole of life policy available on a single, joint or multiple lives assured last death basis. Old Mutual International will pay a death benefit of 101% of the surrender value of the bond once we are notified of the death of the last life assured. The bond will then end.
The Collective Redemption Bond (CRB) is a capital redemption contract with a 99-year fixed term. This means the investment will continue to the end of the term (the maturity date), unless it is fully cashed in beforehand. It is designed with multiple policies, giving investors easy and flexible access to their funds when required, complying with UK Income Tax legislation, making the CIB tax efficient for clients looking to move back to the UK in the future.
Tax-efficiency and stability
As the bond is held in the politically stable and tax-efficient jurisdiction of the Isle of Man, your clients’ investments, while held in the bond are not currently liable to any form of income or capital gains tax. For most EU member states, your clients should consider using our Dublin based products to ensure they meet local EU regulations and are tax compliant.
Manage your Old Mutual International business online
With our award-winning online service, Wealth Interactive, it’s fast, easy and convenient for you to do business with Old Mutual International, and for investors to monitor their Old Mutual International investment products. As well as submitting business online, you can also manage the whole of your Old Mutual International portfolio bond business with us through the service.
Clients who take out a new bond will be able to set up their online service account on Wealth Interactive and keep track of their investment straight away.
Supporting your recommendation
Watch our Techcellence videos to help your decision-making and provide key facts about important subjects including the UK taxation of offshore bonds retirement options, inheritance tax and trusts.
For application forms and other documents, please refer to the literature library.
You can also email your clients a link to our consumer web page explaining the Collective Bond.
Contact your Old Mutual International Sales Consultant or e-mail email@example.com to discuss if this could be the right product for your clients.