With Capital Gains Tax being 28% on the sale of an investment property, and Inheritance Tax (IHT) a whopping 40% on death, how can you protect your invested portfolio and maximise the inheritance that you leave behind? The ability to transfer UK-situs investment assets into a QNUPS trust without IHT and CGT liabilities is an attractive prospect that many savvy investors are taking advantage of, so what?s stopping you? Guide to QNUPS Benefits As long as you continue to be in employment, you can keep on contributing to a QNUPS Trust, whatever your age.
A QNUPS allows a much more extensive range of assets to be contributed, which cannot be said for standard UK pensions.
Whether you have cash, UK-situs investment assets such as property, or stock options, you can invest them into the trust.
Unlike standard UK pensions, where the Government drastically limit the amount you can invest, there is a relatively HIGH investment limit for your QNUPS.
As well as the ability to withdraw a lump sum from your QNUPS of up to 30% without being dependent on your retirement.
Loans of up to 25% of the value of the trust can be made at any time, and you won?t be liable for income tax on the loan amount.
A QNUPS doesn?t have tax relief limits, unlike a UK personal pension where the annual and lifetime tax free amounts are set to reduce this April to £40,000 and £1.
Any non-UK source investment income that you invest into a QNUPS isn?t liable for UK Income Tax.
QNUPS investment assets, such as equity portfolios and investment properties, will roll up Gross, meaning that tax is only payable on them when they are ultimately 'Remitted' back into the UK.
HMRC view a QNUPS in the same way as a pension trust; which means that they cannot be taken into account during bankruptcy proceedings and divorce proceedings.
As QNUPS do not have to be registered with HMRC, there are also no requirements for reporting any payments or income to HMRC.
On death, any remaining QNUPS investment assets that haven't been drawn down by you for your retirement proceeds, will pass directly to your named beneficiaries, without attracting IHT, and therefore make best use of the additional value of your QNUPS inheritance.
Although you should understand that there is no tax relief on QNUPS investment assets, the other tax benefits that relate to IHT and CGT mean that for those who are contributing more than the annual limit in place for tax relief in the UK, the benefits of QNUPS are palpable.
So with the benefits of a QNUPS including enhanced flexibility when it comes to the structure of your retirement assets, and little or no IHT and CGT liabilities, you owe it to yourself to look into the investment opportunities a QNUPS can offer you.
With the right advice, you can use the investment flexibility and utilization of the various investor benefits to shrewdly make the most of your retirement plan investments.