4 Box

We call it the 4-Box approach….

  • Tax relief on contributions
  • Tax free growth
  • 25% tax free lump sum from retirement age
  • Balance provides a taxable income
  • Funds accessible from age 55
  • No minimum age to establish a pension
  • Fund can be passed to beneficiary(ies) on death without liability to Inheritance Tax (IHT)
  • Annual Allowance limits the contribution level
  • Lifetime Allowance (LTA) caps the tax efficient fund size
  • Contributions/subscriptions paid from net pay (i.e. no tax relief)
  • Tax free growth
  • Fund can be accessed to provide an income without liability to tax
  • Transferrable to spouse on death. If no spouse then they form part of the estate and are subject to IHT
  • Subscription limited by the annual allowance
  • ISA variations are now available for:
    1. Children: ‘Junior ISA’
    2. Home Purchase where tax incentive available: ‘Lifetime ISA’
  • No limit on investment amount or fund value
  • No tax relief on investments
  • Growth subject to tax on income (dividend/yield) and capital gains (CGT) but personal allowances available to mitigate CGT and dividend tax
  • Funds accessible any time (but could be subject to tax charges)
  • No limit on investment amount
  • No tax relief on investment
  • Up to 5% per annum of original investment can be withdrawn each year for 20 years (when 100% of original investment would have been returned)
  • 5% withdrawals not taken in any year can be rolled forward
  • Fund grows without liability to income or capital gains tax
  • Tax is ‘deferred’ and any deemed growth on capital after 20 years can be subject to income tax (if UK resident)
  • Growth can be ‘top sliced’ or plan can be assigned to a lower rate tax payer to reduce tax liability

What Clients Say:

Expert planning and wealth structuring.