BEGINNERS GUIDE
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Taper relief
Taper relief has been lauded by some as one of the government’s most successful enterprises for encouraging entrepreneurs.
Absolute returns
Since derivatives have become permitted holdings in some unit trusts and other funds such as open-ended investment companies (Oeics), a number of investment houses have sought to attract investors by using these tools within their funds.
Property gains
The chancellor’s generous tax exemption for anyone selling their main home is a relief given the huge rise in property prices in recent years. But for those who have bought more than one property, selling up could incur a significant tax bill
Save As You Earn
Each year, millions of employees take part in workplace schemes which allow them to buy equity in their company, often at a discounted price. These Save As You Earn (SAYE) schemes are the most popular employee share plan in the UK and can be an excellent low risk way to build up a stake in your employer.
Enterprise Investment Schemes
With less than three weeks to go until the tax year ends on April 5, the annual rush to make tax-efficient investments is in full swing. This year, financial advisers are reporting particularly strong interest in the Enterprise Investment Scheme (EIS).
Inherited estates
Two of the UK’s largest life offices have announced that they are looking into unlocking millions of pounds lying dormant in “inherited estates” for with-profits policyholders. But hopes of large windfalls for policyholders should be kept in check.
Traded endowment policies
Where once the annual bonus season for with-profits policies was a heady time of year, it raises little more than a flicker of interest now. The decline of annual bonuses has encouraged many policyholders to think twice about holding on to their policies until maturity.
Private equity
Private equity is in vogue. J Sainsbury, the supermarket, is being stalked by a group of the world’s most established private equity houses. The possible takeover underlines the power of the buyout industry.
Fund evaluation
The first factor to consider when evaluating an investment fund’s record is the investment performance, measured in returns as a percentage of assets. This is the most widely quoted statistic for the majority of funds.
Covered Call Funds
Growing numbers of investors can put their money into covered call funds which use derivatives on top of traditional equities to generate above-average income yields.
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