The European Collective Investment Bond (ECIB) is a portfolio bond specifically designed to be tax efficient, predominantly for UK and Ireland expatriate investors, whilst taking significant advantage of offshore tax benefits. It gives your clients freedom to build on their wealth by investing in a wide range of funds to create a positive financial future.
All the investments available through the ECIB 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 moves back to the UK, meaning any UK tax will be reduced proportionately for time spent as non-UK resident.
For more information, see our Techcellence video that covers time apportionment and top slicing.
Clarifying the status of the ECIB available through Old Mutual International Ireland
The European Collective Investment Bond (ECIB/E05A) is available in Cyprus, Belgium, Luxembourg, Malta, Gibraltar and the UK (for brokers passporting into the UK). As this product is designed to be acceptable in a number of jurisdictions there are various legal and regulatory regimes that apply. As such, this product is not designed to accept either Alternative Investment Schemes (AIS) or Unregulated Collective Investment Schemes (UCIS). If these asset types are required then they continue to be acceptable assets through the European Executive Investment Bond (EEIB/E04A) only if available in the relevant territory.
Choice and flexibility
The ECIB offers your clients a selection of UK tax-compliant investments, allowing them to spread their capital across a wide range of assets, giving excellent potential for growth. It provides great flexibility by enabling investors to:
- invest in a wide range of funds from 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
- 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. Watch our Techcellence video for more information.
- view performance, access valuations and reports quickly and conveniently through one website saving time, effort and costs
- appoint third party fund managers for additional oversight and control
- adapt and move their investment as circumstances change, although there may be restrictions in certain countries so financial advice is crucial to maintain tax efficiencies.
- pay in, withdraw and invest in multiple major currencies (subject to our acceptance)
- use a trust (where acceptable) to help safeguard their investment. Visit our Trustabilty hub for more information on how you can use a trust as a financial planning tool
- postpone taxable events by managing the timing of withdrawals as in most countries the gains are not taxed until realised
- make regular or one off withdrawals free of charge, subject to minimum withdrawal amounts and a minimum surrender value
- benefit from significant savings on initial fund charges, thanks to our negotiating strength
Looking for a more personalised portfolio?
For clients with a higher amount to invest who are looking for an even wider investment choice, the European Executive Investment Bond (EEIB) can provide the opportunity for a more personalised portfolio. However the EEIB, classed as a highly personalised bond for taxation, isn’t as tax efficient if your client is considering moving back to the UK. Watch our Techcellence video to understand the taxation of personal portfolio bonds.
Tax efficiency and stability
Under current Irish legislation, Old Mutual International Ireland dac enjoys tax exemption in respect of the bondholder’s funds. Investments within the bond can therefore grow virtually free of Income Tax and Capital Gains Tax (CGT), although there may be an amount of withholding tax on income which cannot be reclaimed.
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 Old Mutual International portfolio 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 all other 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 European Collective Investment Bond.
Contact your Old Mutual International Sales Consultant or e-mail firstname.lastname@example.org to discuss how this could be the right product for your clients.