88. Access – retain right and flexibility over future income stream
89. Tax Savings – Immediate IHT saving, Tax-free growth, further IHT after 7 years and No Income Tax on death
90.
91. Year 1 £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ £ Investors Estate Year 2 Year 3 Year 4 £ Year 5 Year 8 Year 6 Year 7 In any year some, all or none of a reversion can be taken £ £ £ £ £ £ Year 9 Year 10 Year 11 Year 12 Chargeable gain assessable at Settlor’s marginal rate of income Tax No Income Tax on death £ £ £ £ £ Year 14 Year 13 Year 16 Year 15 Postponement does trigger Tax events
93. Business Property Relief (BPR) Qualification can be complex BPR available on “Relevant Business Property which has been owned for 2 Years at the rate of 100%” (Inheritance Tax Act 1984 Sections 105 and 106) Relevant Business Property includes:- The shares of an unquoted company which is undertaking permitted business activities. Permitted business activities includes trading but not investment
99. Fund Structure:Limited Liability Partnership Subscriber 1 £50,000 Other Subscribers £9,850,000 Subscriber 2 £100,000 XXX Fund Management LP (Manager) XXX IHT Fund Limited Liability Partnership £10m XXX Corporate Finance Limited (Sponsor & Operator) Experienced operators (Business Managers) Care Home £2m Health Club £1.5m Property Development £1.5m Pub £1m Two Hotels £4m Care Home Operator Health Club Operator Property Developer Pub Operator Hotel Operator
100.
101.
102. Purchased property for £1.6m in May 2010 with a £900k (16-week) extensive redevelopment programme which commenced in June 2010
103. Re-opening in October 2010 as an exclusive boutique B&B with a stylish and contemporary steakhouse bar and grill on the ground floor
104. Property purchased as a joint venture with Urban and Country Leisure, who own and operate a number of similar venues in central and southern of England
105. Purchase of property and all refurbishment works funded 80% by the Downing IHT Funds, 20% by Management
106.
107. 90 Days £100 £103 £97 Investor Company 180 Days 0 Days CAPITAL PROTECTION EXAMPLE TRADE CREDIT INSURANCE SUPPLIER RETAILER CAPITAL PROTECTION For illustrative purposes only
125. Adviser value is in discussing, creating and reviewing a comprehensive and robust overall strategy, not simply selecting a product
126. Question Time Robin Stevenson Duncan Orr robins@swindellsandgentry.co.ukduncano@swindellsandgentry.co.uk 01825 763366 01323 894202
Editor's Notes
Since the investment has been made, 4 of the apartments have subsequently been sold and 5 are tenanted on a ‘rent-to-buy’ basis (24months) which gives an option of placing the rent as deposit to buy. The sales & r-t-b gives a clear exit route for the funds. The market for selling property id very tough in Armley, and the sale prices of £100,000 are now considered too high by agents and so the prices are to be reduced to sell the remaining three flats. The IHT fund capital is still well covered.
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