An AIM Inheritance Portfolio gives investors a transparent and efficient method of reducing inheritance tax with growth potential. If you hold shares on the Alternative Investment Market (AIM) then you will qualify for Business Relief, which means that, if your shares are held for two years or more before your death, your estate will be immune to inheritance tax (IHT). This exemption means AIM shares are a potent planning vehicle for IHT, offering both tax savings and capital appreciation. But investors should remember that, from 6 April 2026, only 50% IHT relief will apply to AIM shares, so the sooner you do this, the better. Also, AIM shares are flexible because they can be sold at any time, which makes them an excellent investment to help you save wealth for your children.
Shares in AIM companies are treated as unquoted for tax purposes, meaning that investors can benefit from Business Relief and obtain 100% relief from IHT provided that the shares have been held for a total period of no less than two years at the date of death. The service is a relatively simple, cost-effective and quick means of reducing IHT whilst providing growth potential and access to capital.
From 6 April 2026, AIM Shares will only benefit from 50% relief as opposed to 100% relief currently. This means AIM shares will be taxed at an effective 20% Inheritance Tax rate from 6th April 2026.
From 6 April 2027 most unused pension funds and death benefits will be included within the value of a person’s estate for Inheritance Tax purposes.
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Changes to Business Relief for AIM shares in the Budget 2024 and the treatment of unused pension funds for IHT purposes make the IHT Portfolio an interesting estate planning tool as pensions brought into the estate for an inheritance tax perspective will grow those number of people likely to pay tax.
Risks of the AIM Inheritance Portfolio
- AIM shares are likely to be high-risk and volatile. Their value and the income arising from them may go down as well as up, and there is the possibility that investors could lose their entire investment.
- Individual client returns will differ from the Composite depending upon the timing of the investment and the individual stocks selected.
- The value of investments can go down as well as up, so investors may not receive their full amount invested. An investment in smaller companies is likely to be higher risk than many other investments.
Fees
Initial Fee
None
Ongoing Fee
1% per annum
Dealing fee
None
Suitable investors
- You are looking for flexibility: An advantage of our service is that you retain ownership of the assets so if circumstances change you can, subject to liquidity, sell your holdings.
- You are looking for simplicity: With an IHT portfolio service there is no need to set up a trust or engage with complex legal structures.
- You are looking for speedy IHT solution: Unlike other IHT mitigation schemes, you do not have to wait seven years for the tax relief to take effect.
- Diversify other estate planning: An AIM portfolio can serve as a valuable part of a broader IHT strategy, allowing investors to diversify beyond traditional assets like property or cash while still working towards tax efficiency.