Investments in AIM-listed companies that qualify for Business Property IHT Relief (BPR) can be modelled by entering the shares using the investment Type “Unwrapped Investment”.
To enter AIM Shares:
Click on the + button
1. Go to the Savings & Investments screen.
2. Select Investments
Select the investment Type “Unwrapped Investment”.
3. The investment will automatically default to the Primary person in the plan so you need to check this and change this by using the drop down box if this is not the case.
4. To designate holdings within an Unwrapped Investment as AIM-listed company shares, you will need to use the drop down box on Qualifies for IHT Relief (BPR/APR) and select 'Yes'. This will provide you with further boxes to complete that are relevant to this investment.
Select the Year qualifying for IHT Exemption for the ISA.
This box only applies to Existing Investments. This field is not relevant to Transfers and New/Regular contributions.
For transfers/new investments, IHT relief occurs 2 years after the transfer/contribution made into the investment. The 'Year Qualifying for IHT Exemption' field will be left blank in this instance and the software will determine the correct year in which the IHT relief will apply.
If you are entering multiple transfers into a new investment, these would be best entered as separate investments to allow the software to start the 2 year clock after each investment.
This means that for an investment set up by a transfer in 2024, IHT relief will apply from the end of 2026 (2 years) i.e. showing on the software at the start of 2027. We would expect to see the BPR relief from 2027 onwards.
'Percent Exempt', this is the amount that the relief will be given on i.e. if the whole investment is qualifying you would enter 100% in this field.
Select whether the Gains Qualify for Entrepreneur's Relief
5. In the Contribution field, enter the annual contribution amount, if future contributions are planned. When you have entered a contribution amount £ or %, the software will prompt you to update the timing of the contribution/s.
6. Click on the Update Timing prompt or you can navigate to the Timing option on the Investment menu.
From here, if you have set up an existing event for the contributions to start you could use that event to set the timing of the contributions by dragging and dropping these events into the appropriate boxes.
Click Done
Or alternatively, you can click on the grey panels within the Timing box to create an Event for the contributions to start and stop. Set these as your Start/End events. Click Done
You can check this is working by looking at Year View>Investments
This will also show on the Overview>Legacy screen
Further reading:
Please note that it is now possible to model an AIM using Investment Type "Stock Market ISA/Junior ISA".