Investment bonds lost popularity with some financial advisers after the Retail Distribution Review as they could no longer receive commission on them.Â
But for some advisers they have remained a popular way to conduct financial planning, especially when trying to pass wealth down the generations.
They are also tax efficient – there is no tax deducted on dividends from equities held in the wrappers and capital gains are taxed at 20 per cent, making bonds very appealing for those who plan to invest for the long term.
Both onshore and offshore bonds allow investors to withdraw up to 5 per cent of contributions each year without being liable for tax, and both types can generate income. They can also be held in trust.
This guide looks at the various dimensions of bonds and how they can be used in family wealth planning. It is worth 60 minutes of CPD.
