Managing your finances is not an easy task, and many people worry whether they\’ll have enough money to last them through retirement. Most people are likely to need a helping hand from a financial adviser, and a new move from the government will help make receiving this advice easier than ever before.
It\’s no secret that the Assurance Vie (AV) is by far and away the most popular investment vehicle in France……….and for good reason! Most of you will already be familiar with these investments, or at the very least, have heard of them, but it doesn\’t harm to be reminded now and again as to why they are so popular.
What are they? – An AV is simply a life assurance wrapper that holds financial assets, often with a wide choice of investments, and there is no limit on the amount that can be invested.
What\’s so good about them?…..quite simply, their huge tax advantages, such as:
- Tax-free growth – funds remaining within an AV grow free of French Income and Capital Gains tax.
- Simplified tax return reporting – considerable savings in terms of time and tax adviser fees.
- Favourable tax treatment on withdrawals – only the gain element of any amount that you withdraw is liable to tax. There is an additional benefit after eight years in the form of an annual Income tax allowance of €4,600 for an individual and €9,200 for a married couple.
- Succession tax benefits – AV policies fall outside of your estate for Succession tax and the proceeds can be left directly to any number of beneficiaries of your choice (not just the ones Napoleon thought you should leave them to!). There are very generous allowances available to beneficiaries of contracts taken out before the age of 70.
Why invest in an International Assurance Vie?
There are a number of insurance companies that have designed French compliant international AV products, aimed specifically at the expatriate market in France. These companies are typically situated in highly regulated financial centres, such as Dublin and Luxembourg. Some of the advantages of the international AV contracts are:
- The possibility to invest in multiple currencies, including Sterling and Euros.
- A large range of investment possibilities available.
- The majority of international AV policies are portable, which means that should you return to the UK, it will not be necessary to surrender the bond.
- The documentation for international bonds is available in English.
At Spectrum, we only recommend products of financially strong institutions and domiciled in highly regulated jurisdictions. If you would like to know more about these extremely tax efficient investments, or would like to have a confidential review of your financial situation, please feel free to contact me.
The Spectrum IFA Group advisers do not charge any fees directly to clients for their time or for advice given, as can be seen from our Client Charter at www.spectrum-ifa.com/spectrum-ifa-client-charter