Talbot and Muir

Investment Choice

HMRC regulations allow registered pension schemes to invest in a wide range of assets including:

• Securities listed on any stock exchange, including the Alternative Investment Market
• Fixed interest securities
• Unlisted securities
• Loan notes
• UK Government Treasury gilts
• Bank deposit accounts
• Offshore deposit accounts
• Investment Trust shares listed on any stock exchange
• Exchange Traded Funds (ETFs)
• Authorised unit trusts
• Open Ended Investment Companies (OEICs)
• Real Estate Investment Trusts (REITs)
• Trustee Investment Plans (TIPs)
• Insurance company funds
• Commercial property
• Overseas commercial property
• Warrants
• Futures, options and derivatives
• Contracts For Difference (CFDs)
• Venture Capital Trusts (VCTs)
• Enterprise Investment Schemes (EIS)
• National Savings & Investments (NS&I) products
• Loans to unconnected third parties
• Intellectual property

It should be noted this list is not exhaustive, and if requested we can provide further guidance on whether a specific investment is allowable.

When assessing investment opportunities, it is important that you are mindful of the taxable property provisions, and whether the investment you are seeking to make will result in the scheme having a direct or indirect holding in such property. The consequences of making such an investment are severe not only for the member but also for the administrator. Therefore, we would strongly advise you to contact us when considering what could be deemed a more esoteric investment.

The taxable property provisions and subsequent charges have resulted in many providers applying their own restrictions on what HMRC consider to be permitted investments. In many cases, such restrictions could be considered onerous, effectively negating the increased investment scope offered by the pensions legislation, and ultimately restricting individuals from achieving their investment objectives. Our approach is to look at each investment within the broad context of the pensions legislation. If the investment can be undertaken without detriment to the scheme member and us as co-trustee, we will do our utmost to accommodate it. However, we will at no point enter into an investment where we feel that the client will incur a tax charge.