Deepbridge IHT Service | Investing in renewables

Summary: Deepbridge IHT Service

An opportunity for subscribers to obtain relief from Inheritance Tax after only two years, the Deepbridge IHT Service deploys into Business Relief qualifying companies that trade in renewable energy generation assets, offering Inheritance Tax exemption after just two years.

If you are interested in finding out more, please contact us here.

Drimlee hydropower site

Investment Strategy

The Deepbridge IHT Service is designed to deliver a portfolio of Business Relief qualifying renewable energy companies that look to have a high degree of asset-backing, and a business model based on the UK Government subsidies for the generation of renewable energy. The Deepbridge IHT Service has a target priority return of 6% per annum.

Attractive subsidies: The UK Government offers subsidies to the renewable energy sector, including Renewable Obligation Certificates, Feed In-Tariffs and contracts for differences.

Seeks to avoid planning risk: Investments will be made in projects with all the necessary permissions in place, providing a known cost base for the investment.

Proven technology: The use of proven renewable energy technologies that allow levels of energy production to be forecast with a good level of accuracy.

INHERITANCE TAX (IHT)

Inheritance tax (IHT) is potentially payable on any money or assets that an individual leaves behind on death or gifts made in the years before death. The assets and money held by an individual on death is known as their estate. After death, an individuals’ estate is usually distributed in accordance with instructions within their will or in accordance with the law if no will is in place. Inheritance tax is charged by the Government on this inheritance. Increasing numbers of people are facing the prospect of having their estate taxed at 40%, over the IHT threshold of £325,000, on their death, depriving their family or beneficiaries of this wealth. If the estate is valued below this threshold it falls within the nil rate band (NRB) and no IHT is payable.

Investments in unquoted companies carry high risks and investors could lose all funds invested. Investors should not invest if capital is required in the near term. No established market exists for the trading of shares in private companies, making it difficult to sell shares. The value of tax reliefs depend on personal circumstances and may be subject to change in the future. The availability of tax reliefs depends on the companies invested in maintaining their qualifying status. Please note that HMRC will only assess whether your investment is Business Relief qualifying, and therefore eligible for 100% Inheritance Tax exemption, upon death and not at the time that the investment is made. Therefore, legislation at the time of death will be the basis for assessment for Business Relief eligibility. Past performance is not a guide to the future performance of an investment, and investors are encouraged to take independent legal and financial advice before considering an investment.

Business Relief

Introduced by the UK government in 1976, Business Relief (formerly known as Business Property Relief) is designed to incentivise individuals to acquire shares in qualifying UK trading businesses. Through Business Relief, an appropriate subscription can benefit from 100% relief from inheritance tax after death if the investment is held for a minimum of 2 years and still held on death. Business Relief is considered by HM Revenue & Customs (HMRC) on a case-by-case basis on death.

Business Relief

Applies after initial holding period of 2 years has expired
Qualifying shares are deemed exempt from Inheritance Tax
Assets must be held at date of death.

Replacement Relief

Applies where Business Relief-qualifying shares are sold and then reinvested in a Business Relief qualifying investment within 3 years
IHT exemption qualification period is based on both holding periods.

Which companies qualify for business relief?

Smaller companies that are not listed on the main London Stock Exchange
Some companies that are listed on the Alternative Investment Market (AIM) or Plus stock exchanges
Businesses considered to be ‘actively trading’, and are therefore not just investment companies.

It is worth noting that some businesses, including those that deal in stocks and shares, land or buildings and some specific industries (including resources, mining companies and not-for-profit organisations) do not qualify for Business Relief.

DEEPBRIDGE CHARGES

There are no management charges levied on the subscriber, resulting in 100% allocation of subscription. This ensures 100% tax efﬁciency for subscribers. Deepbridge fees are paid by the trading companies and are disclosed in the Information Memorandum.

Please see the Information Memorandum for full details.

Please note that the Deepbridge IHT Service accepts subscriptions via financial advisers only and does not accept subscriptions from direct clients.

PLEASE NOTE THAT WE ARE CURRENTLY UPDATING PRODUCT DOCUMENTS - THESE WILL BE ADDED TO THIS PAGE SHORTLY. IN THE MEANTIME PLEASE CALL 01244 746000 IF INTERESTED IN THE DEEPBRIDGE IHT SERVICE.