19 September 2014
Skandia International, part of Old Mutual Wealth, has enhanced the adviser charging options available on its range of offshore bonds. The enhancement means the advice fee no longer needs to be deducted from the annual 5% tax-free withdrawal allowance, leaving more of the allowance for the customer. This is great news for UK advisers and customers who want to use the 5% withdrawal allowance on offshore bonds because customers can benefit from greater tax-free income.
The enhancement follows HMRC’s recent confirmation that, provided certain conditions are met, all advice relating to investments linked to the offshore bond can be considered as advice to the life company and not to the adviser. This means that the advice fee is deemed to be part of the product, and does not impact the annual 5% tax-free withdrawal allowance.
This only applies where the advice relates specifically to investment advice. Skandia International previously used this model on its Discretionary Asset Management service and is now able to roll it out to all advisers offering investment advice.
Rachael Griffin, head of technical marketing at Skandia, comments:
“This enhancement is fantastic news for customers. It means they have more of the annual 5% tax-free allowance to take as withdrawals. We’ve had a great response from advisers to this development as they see this as a real tangible benefit to their customers, and are keen to set up their new offshore bond business in this way.”
For more information contact:
Old Mutual Wealth
02380 916 99807824 145 076