Get Investment Mandate And Risk Profile Form For Offshore Bonds

You can assign segments of the bond to beneficiaries without incurring any immediate tax liability. If you survive for seven years it is considered outside of the estate, and is not subject to inheritance tax (IHT).

No, Premium Bonds are not free from Inheritance Tax. If the capital tied up in them forms part of the deceased's Estate, their value may be subject to Inheritance Taxation when they are passed on.

Offshore bonds grow in a virtually tax-free environment which is known as gross roll-up. Individuals can offset their gain against any unused personal allowance, the starting rate of 0% and the personal savings rate if applicable. Individuals may be able to make use of top slicing to reduce the tax payable on the gain.

Surrender the bond This will be a chargeable event and any gain will be treated as estate income and subject to basic rate tax. Onshore bonds - the 20% non-reclaimable tax credit will satisfy the LPRs tax liability. Offshore bonds - the LPRs will have to pay 20% tax on the full gain.

Offshore bonds are tax wrappers, within which you can invest in a wide range of funds covering different types of assets such as equities, fixed interest securities, property and cash deposits.

On the death of the last surviving policyholder, the bond can be inherited by a beneficiary of the policyholder's estate. There won't be any income tax to pay until the bond is surrendered or the last life assured dies but its value could be chargeable to inheritance tax.

With an offshore bond, gains are charged at basic rate in the hands of the personal representatives. When the proceeds are later distributed to the beneficiary, the chargeable event gain will be taxable on the beneficiary who will be treated as having paid tax on the gain at 20% basic rate.

With an Offshore Bond, you can invest a lump sum or regular payments. Investing your money means it could potentially grow tax efficiently over time because you won't normally pay tax on investment growth, which could give you more savings for the future.